FIS is an Ethereum token that powers StaFi, a cross-chain protocol for trading staked assets as derivatives (also called “liquid staking”). Users can stake proof of stake assets via StaFi to receive “rTokens” (for example, staking 1 XTZ on StaFi might generate 1 rXTZ), which can be freely traded and redeemed for a corresponding amount of the locked and staked asset. FIS is used for staking and minting rTokens, and for paying transaction fees on the network.
What Is StaFi (FIS)?
StaFi (FIS) is a cross-chain staking derivative protocol. The project aims to unlock the liquidity of staked assets for users. Liquidity is the ability of a token to be easily converted into currency or other coins. Named after the combined abbreviation of Staking+Finance, StaFi seeks to generate maximized staking rewards for users within the ecosystem. This unlocking of staked assets executes with the assistance of its rTokens such as rDOT, rATOM, rBNB, etc.
According to the whitepaper, the DeFi system on the blockchain network aims to bridge the gap with the existing financial system by allowing users to earn yield through their cryptocurrency holdings. However, the current accepting staking model presents issues that stifle adoption on a large scale. Most staking protocols require users to lock their tokens for a while to maintain network security. Thus, users are unable to utilize their tokens for liquidity and unable to trade if their tokens lose value and are subject to the security risk of each token mainnet. StaFi aims to transform proof-of-stake liquidity, making it more accessible and beneficial for users.
rToken is short for redeemable token. These are the tokens issued by the protocol that is representative of a staked asset and are specially built for liquidity. For example, if a user lends 100BNB tokens to the liquidity pool, then the user is issued 100 rBNB tokens. These rToken seek to allow users to obtain staking rewards and access liquidity by trading rTokens directly. Users also have the privilege to redeem the corresponding portion of staked tokens as and when required.
To maintain the StaFi protocol, StaFi Validators (SV) and StaFi Special Validators (SSV) are essential. That is why StaFi launched FIS, its native token for the protocol. The token is utilized in the system for staking, transactions, and on-chain governance. As per the website, FIS provides security to the network by staking, paying for transaction fees on the StaFi chain, minting, and redeeming rTokens.
History of StaFi
The website mentions a part of the platform’s two-year roadmap. The launch and integration of the rToken were done in Q1, 2021, while introducing a robust system for the rToken in Q3, 2021, conducting the exploration on an open staking derivative platform in Q4, 2021, and planning the launch of StaFiHub, rDex (native decentralized exchange), and more in Q1, 2022.
