What Is an LST? Liquid Staking Tokens Explained

An LST (liquid staking token) is a token you receive when you stake a proof-of-stake coin through a liquid staking protocol, representing your staked coins plus their rewards while staying transferable and usable in DeFi. It solves the main drawback of native staking: your coins keep earning, but you are no longer stuck waiting for them.

LST definition

LST stands for liquid staking token. When you stake natively, your coins are delegated to a validator and usually locked, and getting them back means waiting through an unbonding or unstaking period. A liquid staking protocol does the delegation for you and hands you a token that represents your claim.

That token can be held, sent to another wallet, swapped on a DEX, supplied as collateral or added to a liquidity pool. Whoever holds the LST owns the underlying stake and its rewards.

LSTs come in two broad shapes. In a rebasing design, your token balance grows as rewards arrive. In a value-accruing design, your balance stays fixed but each token becomes redeemable for more of the base coin over time. For a full primer, see what liquid staking is and how it works across chains.

How an LST works

1. You deposit the base coin, for example SUI, EGLD or XRD, into the liquid staking contract.
2. The contract mints LSTs to your wallet and delegates the deposit across one or more validators.
3. Each epoch, validators earn staking rewards, which flow back into the pool.
4. The exchange rate between the LST and the base coin rises (or your balance rebases) to reflect those rewards.
5. To exit, you either sell the LST on a DEX for an instant but market-priced exit, or redeem it through the protocol and wait for the chain's unbonding period.

Some chains have liquid staking built in. Radix, for instance, issues Liquid Stake Units (LSUs) natively when you stake to a validator, and its own guide describes a standard unstake period of 2,016 epochs, or about 7 days (Radix staking guide, checked October 2026).

LST example

Say you deposit 1,000 SUI into a value-accruing LST when the rate is 1 LST = 1.000 SUI, so you receive 1,000 LST. Assume, hypothetically, that the staked SUI earns 3% over a year after fees. A year later the rate is about 1 LST = 1.030 SUI. You still hold 1,000 LST, but they now redeem for roughly 1,030 SUI.

Now say the LST trades at 0.99 of its redemption value on a DEX. Selling 1,000 LST gives you about 1,020 SUI right away, while redeeming gives you 1,030 SUI after the unbonding wait. That gap is the price of instant liquidity.

Why LSTs matter

LSTs let staked capital do two jobs at once, which is why they underpin much of DeFi on proof-of-stake chains. They also stack risks on top of ordinary staking:

• Smart contract risk. A bug in the LST contract can affect every holder.
• Depeg risk. The market price can fall below redemption value when many holders sell at once or DEX liquidity is thin.
• Validator risk. If a chosen validator underperforms or is penalised, the backing shrinks.
• Leverage risk. Using an LST as collateral to borrow more of the base coin magnifies gains and losses.

Our guide to Sui liquid staking options compared shows how these trade-offs differ between providers.

LSTs on JewelSwap

JewelSwap issues JWLSUI on Sui, JWLEGLD on MultiversX and JWLXRD on Radix using a dual-token model. You mint the base LST against the native coin, which the docs describe as 1:1 backed, and you can stake it for SJWLSUI, SJWLEGLD or SJWLXRD, which appreciate against the base token as rewards arrive. Redeeming JWLEGLD through the protocol goes through a 10-epoch unbonding period (usually about 10 days) and issues a transferable claim NFT; the DEX price can differ from redemption value in the meantime. See JWLEGLD explained and JWLXRD on Radix.

Related terms

• Slashing — a protocol penalty on validators that misbehave, which can reduce staked funds.
• Epoch — the fixed period after which a chain settles staking rewards and validator changes.
• Auto-compounding — reinvesting rewards automatically so they earn too.
• Governance token — a token that carries voting power over protocol decisions.
• APY vs APR — compounded versus simple annual yield.

Learn more on the JewelSwap blog

• What is liquid staking? JewelSwap across Sui, MultiversX and Radix — the full mechanics of liquid staking and the dual-token model.
• Sui liquid staking compared (2026) — how Sui LSTs differ on design, liquidity and risk.
• JWLEGLD explained — minting, staking and unbonding EGLD on MultiversX.
• JWLXRD liquid staking on Radix — how JWLXRD and SJWLXRD work with XRD.

Frequently asked questions

What does LST stand for in crypto?

LST stands for liquid staking token. It is a transferable token that represents coins staked through a liquid staking protocol, including the rewards they earn.

LST vs native staking: which is better?

Native staking avoids an extra smart contract layer but locks your coins and makes you wait to exit. An LST keeps you liquid and usable in DeFi but adds contract and depeg risk. Which suits you depends on whether you need liquidity.

Can an LST lose its peg?

Yes. Its market price can trade below the value it redeems for, especially when many holders sell at once or DEX liquidity is thin. Redeeming through the protocol usually returns full value, but only after the unbonding wait.

JewelSwap Crypto Glossary · educational, not financial advice. Updated 2 October 2026. Browse the full glossary.