PoS (Proof of Stake) - a consensus algorithm in which the creation of a new block depends on the proportion of coins that are in the network validator's stake, relative to the total number in the network.

PoW (Proof of Work) - consensus algorithm, in which to create a new block in the blockchain, it is necessary to perform mathematical operations to solve cryptographic hashing problems. The higher the power of the equipment that deals with these tasks, the more likely it is to create a new unit.

Liquid Stake - is the process of unlocking invested capital in a PoS network.

Stake - is the process of locking tokens on a PoS chain to secure the network. In return, you are entitled to receive so-called staking rewards (which are issued in tokens of this network).

Liquid staking exposes the non-liquidity of the given synthetic derivative token production assets (ClayStack issues csTokens) that your staked capital consumes. These token’s are (in most cases) used to accumulate tokens that can be used as underlying capital in other DeFi protocols. How? Let's figure it out.

The security of any decentralized blockchain network depends on its participants. In the case of PoW consensus mechanisms, these participants solve complex computational problems using specialized (and mostly very expensive) hardware, which is chosen as the synthesizer of the next block. In return, they receive what is known as a mining reward.

However, in PoS consensus mechanisms, these "miners" or block proposers are selected based on the number of that network's tokens they have "provided". They do not need to rely on specialized hardware to be selected as a block validator. This reduces dependence on expensive resources such as mining hardware and opens up the possibility for several different users to participate in the consensus process on the network. Thus, any user with the required number of tokens can place bets and receive rewards for these actions.

However, the decisive disadvantage of betting on any network is illiquidity. On most networks (with the exception of Cardano), when you deposit your capital into the network, it “locks” it. This means that you cannot use this capital in the future to use it elsewhere.

In addition, if you want to withdraw this capital, you must wait for a certain period of time, known as the decoupling period, in order to withdraw your funds. The worst thing is that you do not receive any rewards during this unstaking period. Thus, when staking, investors face two main problems:

Capital inefficiency: You cannot use your assets while they are staked. They can only earn wagering rewards.

No rewards during disconnect periods: When you want to take your assets off the network, they get stuck in the disconnect period (which can last from a few days to several months). Your staked capital does not earn any rewards during this period.

Liquid staking opens liquidation of assets in PoS networks by issuing tradable synthetic derivatives that use the underlying supply. These derivative tokens can be used in multiple DeFi applications. Liquid staking not only improves efficiency, but also allows users to use their profitable liquid staking tokens in a variety of DeFi applications.

Given the choice of risk between higher but higher returns and lower but steady returns, any reasonable profit-seeking investor would like to allocate a portion of their portfolio to the former and a portion to the latter, depending on their risk appetite. As we have seen in the bull markets, most people ran into high risk, high return investments. But, as we have noticed, these installations are extremely unstable.

But what if users were given the opportunity to receive stable profits, as well as the opportunity to participate in highly profitable protocols? This is what liquidation staking promises. Not only can users earn market-independent, sustainable staking returns, but they can also supply their income by participating in DeFi.

ClayStack is a decentralized liquid staking protocol that runs on Proof-of-Stake. Users can stake tokens in ClayStack smart contracts that issue csToken. This token is fully secured and fully fungible. The value of these tokens increases as they earn rewards from the ClayStack network.

Users can also use these tokens to participate in other DeFi protocols. The combined income from staking rewards and participation in DeFi connections increases the income for the user over time.

csTokens are standard ERC20 network tokens that are fully collateralized by staking on the underlying tokens. The value of the csToken is constantly increasing compared to the base token, abstracting away the complexity of staking, requesting, and restaking.

Users can exchange their csTokens instead of withdrawing their stake. As a result, they avoid withdrawal fees and the need to wait for a “detachment” period before gaining access to their tokens.

The ClayStack contract offers a direct withdrawal mechanism that uses the PoS chain withdrawal system. In most cases, users will need to wait for some time before their tokens become available. Depending on the protocol, this "disconnect" period can vary from a few days to several months.

PoS (Proof of Stake) - a consensus algorithm in which the creation of a new block depends on the proportion of coins that are in the network validator's stake, relative to the total number in the network.

PoW (Proof of Work) - consensus algorithm, in which to create a new block in the blockchain, it is necessary to perform mathematical operations to solve cryptographic hashing problems. The higher the power of the equipment that deals with these tasks, the more likely it is to create a new unit.

Liquid Stake - is the process of unlocking invested capital in a PoS network.

Stake - is the process of locking tokens on a PoS chain to secure the network. In return, you are entitled to receive so-called staking rewards (which are issued in tokens of this network).

Liquid staking exposes the non-liquidity of the given synthetic derivative token production assets (ClayStack issues csTokens) that your staked capital consumes. These token’s are (in most cases) used to accumulate tokens that can be used as underlying capital in other DeFi protocols. How? Let's figure it out.

The security of any decentralized blockchain network depends on its participants. In the case of PoW consensus mechanisms, these participants solve complex computational problems using specialized (and mostly very expensive) hardware, which is chosen as the synthesizer of the next block. In return, they receive what is known as a mining reward.

However, in PoS consensus mechanisms, these "miners" or block proposers are selected based on the number of that network's tokens they have "provided". They do not need to rely on specialized hardware to be selected as a block validator. This reduces dependence on expensive resources such as mining hardware and opens up the possibility for several different users to participate in the consensus process on the network. Thus, any user with the required number of tokens can place bets and receive rewards for these actions.

However, the decisive disadvantage of betting on any network is illiquidity. On most networks (with the exception of Cardano), when you deposit your capital into the network, it “locks” it. This means that you cannot use this capital in the future to use it elsewhere.

In addition, if you want to withdraw this capital, you must wait for a certain period of time, known as the decoupling period, in order to withdraw your funds. The worst thing is that you do not receive any rewards during this unstaking period. Thus, when staking, investors face two main problems:

Capital inefficiency: You cannot use your assets while they are staked. They can only earn wagering rewards.

No rewards during disconnect periods: When you want to take your assets off the network, they get stuck in the disconnect period (which can last from a few days to several months). Your staked capital does not earn any rewards during this period.

Liquid staking opens liquidation of assets in PoS networks by issuing tradable synthetic derivatives that use the underlying supply. These derivative tokens can be used in multiple DeFi applications. Liquid staking not only improves efficiency, but also allows users to use their profitable liquid staking tokens in a variety of DeFi applications.

Given the choice of risk between higher but higher returns and lower but steady returns, any reasonable profit-seeking investor would like to allocate a portion of their portfolio to the former and a portion to the latter, depending on their risk appetite. As we have seen in the bull markets, most people ran into high risk, high return investments. But, as we have noticed, these installations are extremely unstable.

But what if users were given the opportunity to receive stable profits, as well as the opportunity to participate in highly profitable protocols? This is what liquidation staking promises. Not only can users earn market-independent, sustainable staking returns, but they can also supply their income by participating in DeFi.

ClayStack is a decentralized liquid staking protocol that runs on Proof-of-Stake. Users can stake tokens in ClayStack smart contracts that issue csToken. This token is fully secured and fully fungible. The value of these tokens increases as they earn rewards from the ClayStack network.

Users can also use these tokens to participate in other DeFi protocols. The combined income from staking rewards and participation in DeFi connections increases the income for the user over time.

csTokens are standard ERC20 network tokens that are fully collateralized by staking on the underlying tokens. The value of the csToken is constantly increasing compared to the base token, abstracting away the complexity of staking, requesting, and restaking.

Users can exchange their csTokens instead of withdrawing their stake. As a result, they avoid withdrawal fees and the need to wait for a “detachment” period before gaining access to their tokens.

The ClayStack contract offers a direct withdrawal mechanism that uses the PoS chain withdrawal system. In most cases, users will need to wait for some time before their tokens become available. Depending on the protocol, this "disconnect" period can vary from a few days to several months.