# Liquid staking: a transferable claim on a staking arrangement Liquid staking combines a staking arrangement with a transferable token representing an interest in it. The token’s accounting, market price and redemption path are separate properties. For example, Lido’s stETH uses share-based rebasing, while wstETH wraps those shares into a balance that does not rebase. Evidence: [Lido core contract](https://docs.lido.fi/contracts/lido/); [wstETH wrapper](https://docs.lido.fi/contracts/wsteth/) Canonical: https://degreesofsatoshi.com/encyclopedia/liquid-staking/ Published: 2026-10-02 Substantively modified: 2026-10-02 Independently verified by an automated reviewer: 2026-10-02T15:08:18.373Z AI-assisted research and drafting with a separate automated source-verification pass; no external expert or named human review is implied. ## Key facts - **stETH accounting:** Balances reflect shares of the accounted pooled ether. ([Lido core contract](https://docs.lido.fi/contracts/lido/)) - **wstETH accounting:** The token balance does not rebase; its stETH conversion can change. ([wstETH wrapper](https://docs.lido.fi/contracts/wsteth/)) - **Exit:** Protocol withdrawal requests and secondary-market sales are different paths. ([WithdrawalQueueERC721](https://docs.lido.fi/contracts/withdrawal-queue-erc721/); [Lido core contract](https://docs.lido.fi/contracts/lido/)) ## The token is a claim with its own dependencies Native ETH and a liquid-staking receipt are distinct assets. The receipt depends on the staking arrangement’s validators, contracts, accounting and operational rules. A transferable claim does not remove those dependencies. In the Lido mechanism documented when checked on 2 October 2026, stETH balances derive from a holder’s shares and the protocol’s accounted pooled ether. Rewards and penalties can affect that accounting. This describes the cited mechanism rather than a guarantee of future yield. Evidence: [Lido core contract](https://docs.lido.fi/contracts/lido/) ## Rebasing and conversion rates display growth differently A rebasing token can change a wallet’s displayed token quantity while the wallet’s share count stays fixed. A wrapper can keep its token quantity unchanged and represent growth through the amount of underlying claim redeemable per wrapper unit. For an illustrative wrapper, ten units at a conversion of 1.2 underlying units represent twelve underlying units. If conversion later becomes 1.21, the same ten represent 12.1. This arithmetic is not a live wstETH quote or a promise that the rate only rises. Evidence: [wstETH wrapper](https://docs.lido.fi/contracts/wsteth/); [Lido core contract](https://docs.lido.fi/contracts/lido/) ## Selling a receipt is different from redeeming it A secondary-market sale exchanges the receipt at an available market price. A protocol withdrawal follows its request, finalization and claim process. In Lido’s queue, submitting a request is not the same as receiving ETH. Market price can diverge from an accounting conversion rate when buyers price timing, liquidity or risk differently. Using a receipt as collateral also adds lending and liquidation rules on top of the staking arrangement. Evidence: [WithdrawalQueueERC721](https://docs.lido.fi/contracts/withdrawal-queue-erc721/); [Lido core contract](https://docs.lido.fi/contracts/lido/) ## Questions ### Does liquid mean instant redemption at a fixed price? No. Transferability permits a market sale if liquidity exists, while protocol redemption has separate timing and conditions. Neither property guarantees a fixed secondary-market price. Evidence: [WithdrawalQueueERC721](https://docs.lido.fi/contracts/withdrawal-queue-erc721/); [Lido core contract](https://docs.lido.fi/contracts/lido/) ## Claims and scope ### liquid-staking-quick-answer Liquid staking combines a staking arrangement with a transferable token representing an interest in it. The token’s accounting, market price and redemption path are separate properties. For example, Lido’s stETH uses share-based rebasing, while wstETH wraps those shares into a balance that does not rebase. Scope: {"collection":"defi","dataAsOf":null,"blockHeight":null} ### liquid-staking-fact-steth-accounting stETH accounting: Balances reflect shares of the accounted pooled ether. Scope: {"collection":"defi","dataAsOf":null,"blockHeight":null} ### liquid-staking-fact-wsteth-accounting wstETH accounting: The token balance does not rebase; its stETH conversion can change. Scope: {"collection":"defi","dataAsOf":null,"blockHeight":null} ### liquid-staking-fact-exit Exit: Protocol withdrawal requests and secondary-market sales are different paths. Scope: {"collection":"defi","dataAsOf":null,"blockHeight":null} ## Sources - [Lido core contract](https://docs.lido.fi/contracts/lido/) — Lido contributors. stETH share accounting, rebases and staking-pool dependencies. Locator: Deposit; Redeem; Rebase. Retrieved: 2026-10-02. - [wstETH wrapper](https://docs.lido.fi/contracts/wsteth/) — Lido contributors. Fixed wrapper balances with changing stETH conversion rates. Locator: What is wrapped stETH (wstETH)?; wrap; unwrap. Retrieved: 2026-10-02. - [WithdrawalQueueERC721](https://docs.lido.fi/contracts/withdrawal-queue-erc721/) — Lido contributors. Withdrawal requests, finalization and claims are separate stages. Locator: Request; Finalization; Claim. Retrieved: 2026-10-02. ## Revision history - 2026-10-02: First publication after primary-source research and independent automated verification. - 2026-10-02: Before first publication, independent review checked and revised: keyFacts, sources, prerequisites. Read current Lido core share/rebase accounting, wstETH wrapper and WithdrawalQueue request/finalization/claim. The text does not assert that current Lido consists only of the old core pool or that conversion always rises. Changed fixed token balance to does not rebase: transfers/mint/burn can still change balances. Secondary-market liquidity, protocol withdrawal and market price remain distinct. Added Ethereum staking prerequisite. ## Cite this entry Degrees of Satoshi editorial project. “Liquid staking: a transferable claim on a staking arrangement.” Published 2026-10-02; updated 2026-10-02. https://degreesofsatoshi.com/encyclopedia/liquid-staking/