Solana liquid staking protocol Marinade unveils 'auction marketplace' to optimize yields

Solana non-custodial liquid and native staking protocol Marinade has unveiled its Stake Auction Marketplace (SAM), enabling validators to bid for staked SOL.

Marinade argues that stakers in the Solana ecosystem currently navigate a “confusing and inefficient” process, manually monitoring validator performance to try and avoid irreversible reward losses due to validator underperformance or a change in node operator commissions.

Marinade’s SAM, as part of its V2 upgrade, aims to make staking easier, safer and more widely accessible, enabling users to capture all staking rewards while increasing yields, according to a statement shared with The Block.

“This is a major milestone for Marinade and Solana, as V2 constructs a seamless staking experience that fuels greater ecosystem participation,” Marinade core contributor Michael Repetny said. “The introduction of SAM will ultimately rebalance optimizing staking rewards for our users and support network decentralization simultaneously.”

How it works

The SAM allows Marinade users to automatically delegate their stake to an open market of bidding validators, designed to make staking on Solana more stable and censorship-resistant. 

Marinade claims this will boost yields beyond the current 9% APY available from staking with a 0% commission validator, offering the “best staking yield on the market.”

A marketplace simulation will be available for testing at the end of June, with live auctions set to begin in August and bid distributions occurring in Q4, according to the Marinade team.

“Marinade is setting a new standard for Solana staking by eliminating smart contract risks through an automated delegation strategy,” Repetny added.

Marinade’s V2 upgrade

The SAM is the latest development in Marinade’s V2 upgrade following the launch of Marinade Native and its Protected Staking Rewards program.

Marinade Finance began as a liquid staking protocol, primarily focusing on providing liquidity for staked Solana through its liquid staking derivative, mSOL. This allowed users to stake their SOL and receive mSOL tokens in return, which can be used across various decentralized finance applications on the Solana network, boosting liquidity while still earning staking rewards.

Marinade Native launched in July 2023 to support traditional staking directly through the Solana network, allowing users to stake SOL directly without the need for mSOL. Marinade's Protected Staking Rewards program followed in February this year, designed to lower staking risks by guaranteeing 100% of staker rewards, the team said.

Marinade has a total value locked of $1.1 billion, according to DeFiLlama data — $751.7 million via liquid staking and $371.1 million from native staking. Marinade is the second-largest protocol on Solana by TVL behind liquid staking and MEV infrastructure project Jito's $1.6 billion.