Benqi Liquid Staking

Staking

Benqi is a decentralized liquid staking protocol, allowing anyone to earn yield on their AVAX by delegating their tokens to a network of blockchain validators.

Risk Rating
Average
Protocol Code Quality
Protocol Maturity
Protocol Design
Summary
What we like
Benqi abstracts away the challenges and risks around maintaining staking infrastructure by allowing users to delegate their AVAX to professional node operators.
What we like less
Staking with Benqi assumes greater security risks as the underlying smart contracts may be exploited. Benqi also charges higher fees relative to competitive offerings.
What it means for you
Benqi's liquid staking protocol is the premier platform for you to stake your AVAX and earn rewards for securing the Avalanche network while remaining liquid.
Information
Exploit/Hacks
None
Info
Key Metrics
  • TVL: $239.3M (Rank #55)
  • TVL Ranking by Staking: #0
  • Blockchain: Avalanche
  • Chain TVL
    • Avalanche: $239.3M
Risk Assessment
Average
Protocol Code Quality
  • Code reviewed by at least one experienced auditor; Halborn audited in February 2022
  • Public team promotes accountability
  • No documented protocol hacks since launch
Protocol Maturity
  • Core protocol launched in 2021; maturity over one year minimizes technical risk as smart contracts are well battle-tested
  • Top 5% by total value locked reduces risk
  • Multisig wallet controls protocol upgrades
  • Multisig consists of at least 4 signers, which means the protocol is less susceptible to centralization risks
  • No timelock exists or no information documented, which mean a malicious actor could approve upgrades without any delay
  • Low voting power concentration reduces risk
Protocol Design
  • No death spiral concerns
  • This protocol is susceptible to risks related to staking a token to secure a network, such as slashing events
  • Benqi allows users to stake their AVAX to secure the Avalanche chain while retaining liquidity of AVAX. This is called ""liquid staking"" as the output token can be traded easily unlike staking AVAX by yourself
Things to know about Benqi Liquid Staking

How Benqi (staking) works

Benqi allows users to earn staking rewards without locking assets or maintaining staking infrastructure. Users deposit their AVAX into Benqi's smart contracts and receive sAVAX in return that represent an active balance of the user's staked AVAX along with any staking rewards accrued or penalties inflicted on validators. Users can withdraw or redeem their sAVAX back for their original AVAX at any time, but must wait the 15 day unbonding period before claiming.

How Benqi (staking) makes money

Benqi generates revenue by charging a 10% fee on the staking rewards earned by depositors. This fee includes the delegator fee paid to the underlying validators. As such, the protocol's revenue is driven by the fee charged, the amount of assets staked, and the yield earned by validators.

How you make money on Benqi (staking)

Passive AVAX holders can generate additional yield by participating in the PoS validation mechanism to earn block rewards. The unlocked liquidity with sAVAX can also be used on a number of popular DeFi protocols to generate additional yield.

Benqi Liquid Staking Pools
Benqi AVAX Staking
5.5%
Yield
$292M
TVL
Risk
B
Chain
Avalanche