Staking, Lending, and MEV One Model to Rule Them All
summary
Presents a simple portfolio model where validators choose between staking, lending and liquid-staking returns and a parameter alpha controls how much MEV gets redistributed back to stakers. Shows that a large enough MEV redistribution can replace high inflation, enabling constant or even deflationary staking rewards while keeping security, and that smoothing payouts lowers return variance and stabilizes allocations. Flags concrete risks: revenue-driven stake centralization and off-chain collusion, and the need for mechanism designs to prevent them.
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chapters (9)
- 0:00Intro
- 1:50One of These is Not Like the Others
- 3:07Proof of Stake Protocols
- 3:57A Portfolio Optimization Perspective
- 4:59Staking-Lending Dynamics
- 7:29Vignette 1: Staking vs. Lending
- 10:42Vignette 2: Staking vs. Lending vs. MEV
- 12:34Distributive Properties of Redistribution
- 14:05Future Directions
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