LST
A liquid staking token is a token that represents staked crypto and can be used in DeFi while the original asset remains locked in staking.
LST stands for liquid staking token. It is a token you receive when you stake a cryptocurrency through a liquid staking protocol, representing your claim on the staked asset plus any staking rewards, minus fees. Instead of locking coins directly and waiting for an unstaking period, the protocol issues a transferable token that tracks the value of the staked position. On Ethereum, for example, someone who stakes ETH through a liquid staking service may receive an ETH-based LST in return.
LSTs matter because they make staked assets more usable. Holders can often trade them, provide liquidity, use them as collateral, or move them between DeFi apps while still being exposed to staking rewards. This improves capital efficiency, but it also adds risks such as smart contract bugs, price differences between the LST and the underlying asset, validator performance issues, and dependence on the staking provider. A simple comparison is a claim ticket: the original asset is doing the staking work, while the LST is the receipt that can circulate in other markets.
Other terms in DeFi
AMM
An automated market maker is a DeFi protocol that uses liquidity pools and algorithms to price and swap crypto assets without a traditional order book.
Aggregator
A DeFi service that searches multiple protocols to find better prices, routes, or yields for a user’s transaction.
DEX
A decentralized exchange is a crypto marketplace where users trade directly from their wallets using smart contracts instead of a central intermediary.
DeFi
A blockchain-based financial ecosystem that lets people lend, borrow, trade, and earn yield without traditional banks or brokers.