stXTZ Launches On Etherlink, Introducing Liquid Staking To Tezos' High-Performance Layer 2

In Brief

The integration of stXTZ into Etherlink allows users to stake assets with liquidity, earn tez rewards, and engage in DeFi applications on Tezos’ Layer 2 platform.

Team behind the Tezos-based staking platform Stacy.fi announced the integration of stXTZ, the liquid staked tez (XTZ) token, into Etherlink, an EVM-compatible Layer 2 blockchain powered by Tezos Smart Rollup technology. stXTZ enables users to stake their assets on the network while maintaining full liquidity, allowing them to earn native tez staking rewards and engage with high-performance decentralised finance (DeFi) applications on Etherlink simultaneously.

The global liquid staking market has seen significant growth, surpassing $45 billion, driven by solutions like stETH from Lido, which have become core components of DeFi ecosystems. Liquid staking tokens resolve capital inefficiencies in traditional staking, offering users the ability to earn staking rewards while keeping their assets liquid. This dual advantage has contributed to their widespread use in various DeFi applications, including lending, trading, and yield farming.

Stacy.fi operates on Acurast and was developed by key contributors at Ubinetic AG on behalf of the youves DAO. Following successful governance approval, the youves DAO, made up of all YOU token stakers, now manages the stXTZ pool, token, and manager contracts. While holders of stXTZ retain 90% of the staking rewards, 10% will be collected by a designated reward-collecting contract under the control of the youves DAO.

“stXTZ from stacy.fi allows DeFi users in the Tezos ecosystem to utilize their Tezos funds in DeFi offerings on both Tezos L1 and its rapidly emerging Layer 2 Etherlink, while also contributing to the security of the L1 and earning 90% of the potential staking rewards,” said djangobits, contributor to youves and stacy.fi, in a written statement. “With liquid staked tez, the ecosystem is ready for the next era of DeFi, not only on the L1, but also on the current and future L2s,” they added.

The integration leverages Etherlink’s secure bridging infrastructure, where stXTZ tokens are held on Tezos Layer 1, and ERC-20 compliant proxy tokens are created on Etherlink L2. A price oracle, compatible with Chainlink and powered by Acurast, provides real-time pricing data for DeFi platforms on Etherlink, derived from the stXTZ staking pool contract on Tezos Layer 1.

stXTZ Integration Enhances Layer 2 DeFi Experience, Enabling Staking Rewards And Improved Performance

“The integration of stXTZ addresses a fundamental challenge for users seeking to earn staking rewards while participating in Layer 2 DeFi,” said David Relkin, Head of DeFi at Nomadic Labs, in a written statement. “With stXTZ on Etherlink, users can maintain their Tezos staking exposure while benefiting from the enhanced performance and cost-effectiveness of our Layer 2 infrastructure,” he added.

stXTZ is now accessible within the expanding DeFi ecosystem on Etherlink, which includes platforms such as Superlend for borrowing and lending activities, Curve Finance and IguanaDex for trading the stXTZ/WXTZ pair, Hanji for experienced users and professional traders looking for an advanced trading environment, and Uniswap V3 through oku.trade, Etherlink’s automated market maker (AMM) hub focused on blue-chip assets.