The Filecoin LSD track is about to explode, which projects are worth paying attention to?
Since the launch of FVM four months ago, the Filecoin network has been revitalized.Author: HashKing
More than 2,000 smart contracts have been deployed here, achieving 220,000 transactions, with active user growth of 184.5%. The prosperity of the ecosystem has led to a surge in demand for FIL staking, giving rise to a series of protocols focused on FIL LSD, and a competition for the FIL LSD market has quietly begun.
LSD, short for "Liquid Staking Derivatives," offers more liquidity and composability compared to traditional Staking. From both user and project perspectives, it is increasingly becoming a standard feature of public chains: it is a viable solution for users to earn passive income, an important means for node providers to reduce costs, and an effective way for networks to enhance security.
The rapid development of Ethereum LSD shows that, in the entire crypto market, LSD has almost become the only form of participation that combines stable returns and capital efficiency. Users can earn network rewards at a very low cost while freely building their yield strategies. Therefore, before the Filecoin LSD narrative fully explodes, now is the best time for users to participate.
So, which Filecoin LSD projects are worth paying attention to? The following text selects several protocols that are most worth noting and analyzes them from different dimensions to provide effective references for users' choices.
1. Those FIL LSD Projects
According to incomplete statistics from DefiLlama, nearly 10 protocols currently support Filecoin Staking. The author has selected the five most representative ones: HashKing, STFIL, Filet, SFT, and MFIL. Before diving into specific analyses, let's provide a brief introduction:
1. HashKing
HashKing is a decentralized digital asset staking service protocol characterized by data transparency, one-click staking, and flexible access. Currently, HashKing supports FIL and ETH staking, with plans to launch more digital assets in the future.
2. STFIL
The STFIL protocol is a decentralized liquid staking protocol. It helps borrowers achieve stable returns and provides low collateral loans for storage providers, allowing users to stake FIL without locking it up.
3. Filet
Filet is a decentralized Filecoin staking protocol deployed on FIL and BNB. It is currently upgrading to Filet 2.0, built on FVM.
4. SFT
The SFT protocol is based on Substrate and aims to unlock assets that have been locked up for the medium to long term. FIL users can flexibly participate, transfer, withdraw, or redeem.
5. MFIL
MFIL is a decentralized liquid staking project based on FVM, aimed at solving the liquidity issues caused by FIL staking.
On the surface, these projects may not seem very different. However, if we delve into their security mechanisms, underlying designs, and the yield models that users care about most, they will reveal their respective strengths and weaknesses. Below, we will conduct a more detailed analysis based on different dimensions.
2. Project Breakdown and Comparative Analysis
Dimension 1: Entry Barriers
The height of the entry barriers for protocols directly affects the range of user groups the project can reach. This includes minimum staking limits, staking duration, ease of operation, and user-friendly UI design, aiming to allow both veterans and newcomers to smoothly enter the DeFi world.
First, all these projects have very intuitive UI designs, allowing staking veterans to quickly get started. However, only HashKing and STFIL cater to FIL staking newcomers by providing very detailed graphic operation guides on their official websites.
Second, regarding minimum limits, HashKing, STFIL, and SFT have no minimum participation amounts, allowing entry into staking with very small amounts of capital.
Third, in terms of staking duration, except for Filet 2.0, the others support flexible deposits and withdrawals. Additionally, HashKing and MFIL have no staking duration limits, meaning that regardless of how long the staking lasts or the scale of the staked funds, users can enjoy equal returns, which is very friendly for users with small amounts of capital.
In summary, in terms of entry barriers: HashKing & STFIL > SFT > MFIL > Filet.
Dimension 2: Security Factors
The most critical part of decentralized staking protocols is their security factors, which are the foundation of all activities. There are many factors that affect security; excluding uncontrollable external factors, we have selected three key indicators to focus on:
First, the importance of blockchain code audits is self-evident. Currently, only HashKing, STFIL, and Filet display audit information on their official websites.
Second, the destination of user funds matters. Although they all act as "intermediaries" for FIL staking, the flow of funds differs. HashKing and MFIL directly stake user funds with nodes, ensuring "funds for specific purposes," which greatly safeguards user asset security. If it is a lending model, there may be risks of bad debts and liquidation.
Third, whether node information is disclosed indicates whether the flow of funds is clear and whether on-chain data is transparent. Searching these projects' official websites, only HashKing and Filet intuitively display node information, allowing users to see exactly where their funds have gone to which storage providers.
Additionally, it is worth mentioning that while projects generally choose to collaborate with capable node operators, there still exists a low probability of risk events, such as node power loss or staking coins being deducted. To reduce user staking risks and protect user rights, HashKing requires node operators to lock a portion of their funds as collateral to avoid user fund losses in these special circumstances.
In summary, in terms of security factors: HashKing > Filet > MFIL > STFIL > SFT.
Dimension 3: Yield Assessment
Now we arrive at the part most closely related to investors: yield. As intermediaries between storage providers and users, LSD protocols offer varying yield rates due to differences in fund allocation, node operator selection, and intermediary fees.
In terms of token rewards, HashKing, Filet, and SFT reward users directly in FIL, saving them the step of converting other assets into FIL. Except for Filet, which adopts a reward form on the FIL network with a certain lock-up period, other projects support the withdrawal of earnings at any time.
Regarding staking lock-up periods, Filet 2.0 does not support flexible staking, offering only 180-day and 360-day options. Clearly, for users participating in FIL staking for the first time and seeking capital efficiency, flexible deposits and withdrawals are the more suitable choice. The ranking of flexible APY is: HashKing > STFIL > MFIL > SFT.
Under equal security conditions, users will certainly lean towards options with higher yields. HashKing offers a yield level of 17.8%, which reflects both good node resources and its determination to benefit users, especially since the FIL LSD track is in its early explosive phase, making it the best time for "land grabbing."
In summary, in terms of yield assessment: HashKing > STFIL > MFIL > SFT > Filet.
Dimension 4: Additional Features
As mentioned earlier, the difference between LSD and ordinary staking lies in capital efficiency. When tokens are staked, LSD protocols convert tokens into xTokens, allowing users to earn staking rewards while participating in other areas of the DeFi world. At this point, xTokens become interest-bearing assets that can be used for purposes beyond staking, such as lending, LP farming, etc., enhancing capital efficiency and generating more passive income.
Currently, only two projects offer richer scenarios:
STFIL supports lending, allowing users to lend FIL directly to nodes (with free choice), currently achieving an APY of 18.9%; HashKing supports creating LPs with NFIL/FIL and adding them to liquidity pools to earn more FIL node rewards and transaction fee rewards, with an APY currently reaching 21.9%, which is very attractive in the current market conditions.
Additionally, both HashKing and MFIL come with a Swap feature, allowing users to trade with one click, directly converting liquidity tokens into FIL, greatly enhancing user operational convenience.
In summary, in terms of additional features: HashKing & STFIL > MFIL > SFT & Filet.
3. Conclusion
Based on all the information above, HashKing demonstrates strong overall strength.
In terms of participation barriers, it has no minimum withdrawal limit, supports small capital participation, and offers flexible deposits and withdrawals, making it very friendly for novice users; in terms of security mechanisms, the flow of user funds is intuitive and clear, with real and transparent on-chain data; in terms of yield, it offers highly competitive flexible APY and provides richer yield strategies, greatly enhancing the efficiency of users' capital and ensuring stable asset appreciation.
The emergence of FVM has shown us more possibilities for Filecoin, and the continuous launch of LSD protocols has significantly improved the network's liquidity, stability, and security, acting as a growth flywheel that continuously benefits users, projects, and the network, laying a solid foundation for building a powerful and sustainable "computing + storage" public chain.
As FVM continues to develop and optimize, it will undoubtedly attract more developers and innovators to participate in the Filecoin network, bringing richer applications to users and the entire blockchain world. Ultimately, which project will become the leader in the LSD track and even the Filecoin ecosystem? We'll let the bullets fly for a while longer.
