StaFi is a protocol that unlocks liquidity of Proof-of-Stake (PoS) assets through the concept of rTokens, which are tradeable assets that continue to earn staking rewards paid by blockchain validators.
StaFi allows users to earn staking rewards without locking assets or maintaining staking infrastructure. Users deposit their PoS assets into StaFi's smart contracts and receive rTokens in return that represent an active balance of the user's staked asset along with any staking rewards accrued or penalties inflicted on validators. Users can withdraw or redeem their rTokens back for their original PoS asset at any time, pending any unbonding period.
StaFi generates revenue by charging a 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.
Passive holders can generate additional yield by participating in the PoS validation mechanism to earn block rewards. The unlocked liquidity with rTokens can also be used across DeFi to generate additional yield.