Liquid staking provides increased token utility for locked staked tokens. It allows users to leverage additional DeFi activities (such as securing Kintsugi vaults) using yield-bearing derivatives of staked tokens which otherwise have no utility beyond locking for staking rewards.

LIQUID STAKING 101

Users can compound their yield by utilizing the derivative token for engaging in DeFi activities, including things like trading, liquidity providing, or lending. Liquid staking provides a practical and flexible alternative to the traditional staking model by allowing users more control over their funds and greater access to additional earning opportunities.

Karura is Acala’s experimental “canary” network on Kusama. The DeFi appchain runs a suite of applications for the Kusama ecosystem, including Karura Swap, the AMM-style DEX for trustless trading and liquidity provider rewards, aUSD, an over-collateralized stablecoin, and KSM Liquid Staking (LKSM) — the unlocked, yield-bearing staking token that empowers users to stay liquid while earning their Kusama staking rewards.

Stay Liquid While Staking, and Utilize your LKSM on Kintsugi

In addition, Liquid KSM (LKSM) allows users to stake their KSM while maintaining access to its liquidity. When KSM is staked, users receive LKSM (a tokenized receipt for their stake) with the additional benefit of it being a yield-earning token.

Liquid KSM offers low staking minimums, and no unbonding period for the underlying KSM since users can unbond at any time for a fee. New to LKSM? Follow this guide to start staking your KSM on Karura for LKSM.

Sending your KSM to Kintsugi

Once you have your LKSM on Karura, the process of sending it to Kintsugi is quite simple. Just navigate to Karura’s bridge page, select Karura as the original chain and Kintsugi as the Destination chain and send it to your account on Kintsugi.

Registering a Multi-Collateral Vault on Kintsugi

A single Kintsugi Vault account can support more than one collateral asset.

After installing a vault client, you should follow this guide, which offers you different ways to register a vault. During the registration process, you will select the types of collateral you would like to use. Select LKSM as your desired option and then deposit it as a new collateral asset. Once this is done, the new collateral Vault will appear in the cards in the Vault dashboard.

ABOUT Karura Network

Acala is an appchain powering Web3 finance. Acala’s Ethereum-compatible blockchain has built-in DeFi protocols for application developers to leverage, including a trustless staking derivative (liquid DOT — LDOT), a decentralized exchange, the over-collateralized aUSD stablecoin, and the EVM+, a hybrid EVM offering fully Ethereum-compatible development environment plus full compatibility with Substrate. Karura is Acala’s sister parachain to serve the Kusama ecosystem and shares the same codebase as Acala.

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ABOUT Kintsugi

Kintsugi is Interlay’s canary network, a testnet with real economic value deployed on Kusama (Polkadot’s canary network). Kintsugi and Interlay share the same code base — with the difference that Kintsugi is 2–3 releases ahead of Interlay with more experimental features.

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