Swirl’s Liquid Staking on IOTA: A Game-Changer for DeFi

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So, here we are. Liquid staking has finally made its way to IOTA, promising to shake up its DeFi world with some much-needed liquidity and capital efficiency. It’s like that cool breeze that hits you on a hot day — refreshing, if a little unexpected.

On Wednesday, May 7, the liquid staking solution known as Swirl launched on the IOTA mainnet. And get this, it’s the very first liquid staking solution on IOTA’s Layer 1 network. Shocking, right? After all, who would’ve thought IOTA could do anything this… well, innovative? 🎉

5.5.2025 → A new IOTA begins.
Built on nearly a decade of research.
Inspired by the best of Web3. Committed to open-source values
🔗
Smart contracts, decentralization, real-world adoption – just 2 weeks to launch🧵⤵️ 1/4

— IOTA (@iota) April 22, 2025

With Swirl, users can now earn staking yields on their IOTA tokens while keeping liquidity intact. Yeah, that’s right — no more waiting around like you’re stuck in traffic. Instead of just letting your tokens sit and gather dust, Swirl gives you stIOTA, a liquid token you can trade anytime. The rewards? They’re like a growing pile of coins — up to 10% to 15% annually, if you’re lucky. 💰

The magic happens in the background. Any rewards you get are automatically compounded, meaning you don’t have to keep checking on them like a worried parent. You can just let it do its thing and watch the rewards stack up. You can redeem stIOTA for the original staked IOTA whenever you want, trade it, or even use it as collateral for DeFi protocols. The world is your oyster, my friend. 🦪

But here’s the kicker: While staking increases the number of IOTA tokens, it doesn’t increase the supply of stIOTA. In other words, the value of stIOTA appreciates over time. So, let’s say you swap 100 IOTA for 100 stIOTA. A year later, thanks to that sweet 10% APY, you can redeem those 100 stIOTA for 110 IOTA. Not bad for a year’s worth of waiting. 😏

The IOTA Foundation’s Take on Liquid Staking

The IOTA Foundation is all in on this one. Dominik Schiener, Co-Founder and Chair of the IOTA Foundation, made it clear that the Swirl integration is a strategic move designed to boost the IOTA ecosystem. And, apparently, they’re all about DeFi now. They see it as a tool for sustainable growth and all those fancy capital strategies that really sound like something a Wall Street guy would say, but it’s cool, they mean business.

“Our partnership with Swirl enables new forms of utility through DeFi, By equipping the IOTA ecosystem with tools that users need to pursue sustainable capital growth strategies and doing so with the right partners who share in our commitment to decentralization, security, and a user experience marked by diversification, we are setting new standards for the future of decentralized finance,” Dominik Schiener, IOTA Foundation.

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2025-05-07 18:42