In traditional finance, borrowing, lending and derivative products are often priced relative to a standard benchmark that provides a basis for comparison and evaluation. This gives market participants a degree of transparency and certainty as they pay or receive a rate that is priced above or below a known reference rate, calculated by a third party, rather than be subject to something potentially arbitrary and bespoke. As a result, service providers can compete relative to a common reference. Applied to the crypto industry, staking providers that pay yields relative to an industry benchmark promises to attract a new class of clients that require the transparency of a standardized rate.
How Staking Rates Can Drive the Crypto Economy Forward
