Liquid Staking

Liquid staking is a concept designed to allow individuals to stake their assets while retaining access to their tokens' liquidity. This is achieved through a process involving tokenization and the creation of on-chain representations known as liquid staking tokens (LST). These tokens essentially serve as claims to the underlying staking positions.

When you stake SUI to haSUI, it's important to understand that you're not engaging in a traditional swap between different tokens. Instead, haSUI represents your original staked position. This can be likened to wrapping a token or obtaining a "proof-of-stake token".

Indeed, staking your SUI to haSUI is functionally equivalent to staking your SUI tokens. The price of haSUI in relation to SUI is primarily influenced by staking rewards and is not subject to speculative fluctuations when transitioning from SUI to haSUI. This approach allows you to diversify your stake and distribute it among multiple validators within the Haedal stake pool, rather than locking your tokens with a single validator.