pSTAKE: LAST ON THE LIST, BUT NEVER THE LEAST.
pSTAKE is the last product to be discussed in this series, but from the title of this article, it is clearly not the least of Persistence’s products. On the contrary, pSTAKE is one of the miracles of Persistence and it is currently LIVE. That being said, lets talk about it………
pSTAKE is a Persistence protocol liquid staking solution that establishes liquid staked positions by issuing 1:1 pegged representation against the staked assets of its users. These staked representation tokens can then be utilized to produce further yield in a variety of DeFi applications.
pSTAKE has been rigorously built to overcome the issues faced by PoS stakeholders and improve the end-user experience in order to encourage mainstream adoption.
pSTAKE uses a dual token paradigm to precisely match the workings of the underlying blockchain network, unlike most liquid staking alternatives now available.
This dual token framework enables stkTOKENs to be used in all major DeFi apps (stkTOKENs are representations of staked tokens on the underlying supported PoS network). We will not go any farther into this subject because it is outside the scope of this paper.
The pBridge and pSTAKE smart contracts are the two main components of pSTAKE.
pBridge is a PoS network that supports Ethereum and pSTAKE. pBridge can be used to generate 1:1 pegged ERC-20 wrapped unstaked PoS tokens and stake the PoS tokens that are locked on the bridge. pBridge is a multi-party computation-based bridge that is secured by some of the Proof of Stake ecosystem’s top validators.
The main purpose of pSTAKE is not only to issue staked representative tokens, but also to push adoption of these assets to the point where they are accepted on numerous DeFi protocols, broadening the scope of yield-generating opportunities for pSTAKE users. One of our design goals was to release assets on DeFi mature chains in order to realize this aim. Ethereum was an obvious choice for the production of representative tokens because it is the most commonly used and DeFi mature network.
With pSTAKE, the long-term goal is to create a multi-chain product that allows assets to be issued on various liquidity-rich and mature chains. This includes asset issuance directly on the Persistence blockchain.
pSTAKE Smart Contracts: On the Ethereum blockchain, pSTAKE smart contracts are in charge of minting and issuing wrapped tokens (pTOKENs) and staked representative tokens (stkTOKENs).
Fungibility
The stkTOKENs that have been issued are fungible. Assets staked on the PoS network are delegated over a whitelisted set of validators in a specified proportion to accomplish this fungibility. This stake distribution fraction will be chosen by the pSTAKE team at first, and thereafter managed by the pSTAKE governance token holders.
All stkTOKEN holders are affected by the ecosystem’s shrinking dangers. The hazards of cutting are addressed to a significant extent by distributing delegation over different validators.
Over time, pSTAKE will establish an insurance fund, which will be funded by pSTAKE profits, to cover a fraction or all of stakers’ cutting costs in the occasion of a slashing event.
The underlying PoS network’s security
The protection of PoS networks is strongly based on the network’s decentralisation in considerations of stake distribution. Most PoS networks strive for more than a third of the network’s stake to be spread across as many validators as possible.
The objective of pSTAKE, on the other hand, is to strengthen the security of the underlying PoS network by whitelisting not just the largest stakeholder validators, but also lesser validators with a proven history of consistent performance and uptime, to obtain delegations via pSTAKE and further decentralize the network.
Composability
As previously mentioned, pSTAKE’s dual token feature enables its stkTOKENs to be used in a variety of DeFi protocols, such as DEXs, borrowing/lending platforms, yield maximization protocols, and so on.
Governance
When it comes to PoS networks, governance is the most crucial component. pSTAKE is managed by all of its stakeholders, who decide on things like fees, adding support for other chains, validator whitelists for delegation, and pBridge validators, among other things.
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