What is Liquid Staking on the Sei Network?

Overview

Liquid staking on the Sei Network enables users to stake their SEI tokens through specialized protocols and, in return, receive liquid staking tokens that represent their staked funds. These tokens can be used throughout DeFi—including for trading, borrowing, and other yield-generating activities—while still earning staking rewards. This contrasts with traditional staking, which typically locks tokens exclusively within validation and does not allow for additional liquidity or DeFi usage1 2 3.

How Liquid Staking Works on Sei

Protocols: The primary liquid staking protocols on Sei are Silo and Kryptonite, which launched in early 2024. Each protocol issues a unique liquid staking token:
- Silo: Issues iSEI
- Kryptonite: Issues stSEI
Mechanism: Users deposit SEI into these protocols, which are then delegated to validators to secure the network. In exchange, users receive liquid staking tokens (iSEI or stSEI).
Redemption & Unbonding: These liquid tokens can be redeemed for the underlying SEI after a 21-day unbonding period, typical for many PoS networks to ensure network security2 3.

Market Growth and Adoption

The total SEI tokens liquid staked grew dramatically between 2024 and 2025. By the end of Q4 2024, over 164.9 million SEI had been liquid staked, representing about 3.12% of the total staked SEI. Silo, in particular, established a near-monopoly over the sector, holding about 98.6% market share by late 2024, with Kryptonite’s share declining2 3 4.
The TVL (Total Value Locked) in SEI liquid staking protocols showed steady growth throughout 2024. According to Messari, Silo maintained its lead with 19M SEI TVL by mid-2024, while Kryptonite accounted for about 5.4M SEI5. The growth suggests robust adoption and a maturing DeFi environment on Sei Network.

Additional Protocols and Innovations

StaFi Protocol: Launched the rSEI liquid staking token on Sei V2 EVM. Users can stake SEI for rSEI, which is tradable and continues to earn rewards. Unstaking for rSEI is expected to be enabled by late 20246 7.
Cross-Chain Solutions: New projects like seiyanETH by Dinero allow cross-chain participation, letting Sei Network users access Ethereum staking yields via Sei-native LSTs like sETH and its derivatives8 9.

Key Benefits of Liquid Staking on Sei

Liquidity: Users can use their liquid staking tokens in DeFi without having to unstake their SEI.
Rewards: Continue to earn staking rewards while accessing extra liquidity.
Network Security: Staked SEI via liquid staking still supports network validation and security like traditional staking.

Ecosystem Context

Liquid staking solutions play an increasingly important role in DeFi composability and yield strategies across PoS networks, and Sei's design—with fast finality and a DeFi-centric focus—has made it a natural home for such innovations3 10. Industry trends point to continued robust development of the sector, including ETF applications for staked SEI products11.

Summary Table: Key Sei Liquid Staking Protocols (2024)

Protocol	Liquid Token	Q4 2024 TVL (SEI)	Market Share (Q4 2024)	Redemption Period	Notes
Silo	iSEI	~162.8M	~98.6%	21 days	Clear market leader
Kryptonite	stSEI	~2.1M	~1.4%	21 days	Small, declining share
StaFi	rSEI	(Early Mainnet)	N/A	Initially locked	Tradable LST; unstaking expected late 2024

2 3 5 6+1

Sources

Messari Research: State of Sei Q1-Q4 2024, Protocol News & Chart Data1 3 2 4+1
StaFi News & Release Updates12 6 13 14+1
Dinero & seiyanETH Protocol Announcements9 8

For further detail, you can visit Sei Network's and protocol developers’ official pages linked in the cited reports.

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