Cosmostation Joins MilkyWay as an Operator
Cosmostation joins the Celestia liquid staking protocol MilkWay as one of the seven trusted entities entrusted with the operation of the protocol
Rollup and L2 narrative seems to be what everyone is talking about nowadays. And Celestia is at the center of this narrative. Since the mainnet launch in October, Celestia has been getting a massive amount of attention from the crypto community regardless of their base. The EVM side is excited for Celestia’s use-case as a data availability layer, and the modular community is ready to leverage the full potential of Celestia’s rollkit, data availability layer, and tokens.
With Lido standing as the biggest defi protocol in the entire crypto space, liquid staking is undoubtedly another huge narrative that’s been getting the spotlight. And guess what? MilkyWay is the combination of the both narratives: rollup(Celestia) and liquid staking.
The Celestia Liquid Staking Protocol on Osmosis
MilkyWay is a liquid staking protocol for Celestia on Osmosis chain as a wasm smart contract. Through MilkyWay, $TIA holders can stake $TIA and receive $milkTIA as a representation of their $TIA staking position. The process of liquid staking $TIA involves many steps in order to securely and maintain the system.
The diagram above demonstrates the liquid staking process that takes place when a user liquid stakes $TIA through MilkyWay. Because Celestia does not have its own execution layer, liquid staking has to take place on another blockchain’s execution layer — Osmosis.
Here’re 5 simplified liquid staking steps taken by the protocol:
- User liquid stakes $TIA with MilkyWay
- MilkyWay’s contract on Osmosis receives $TIA and mints $milkTIA
- The user receives $milkTIA
- The contract sends the user’s $TIA to ‘Staker Multisig’ account on Celestia
- The staker multisig account stakes and accumulates $TIA rewards
In case of the withdrawal, the staker multisig account would simply unstake the corresponding amount of $TIA and sends them back to the contract on Osmosis.
The ‘Staker Multisig’
The staker multisig plays an important role in MilkyWay’s security as it holds all the $TIA deposits made by the users. That’s why the multisig is made of the 7 operators selected based on the reputation and expertise in the Cosmos and Ethereum community. Cosmostation has joined MilkyWay as one of the 7 operators securing the user funds involved in the Celestia liquid staking. The multisig is responsible for securely staking, compounding, and withdrawing user funds on Celestia.
$milkTIA
$milkTIA will initially support DEX liquidity through a dedicated TIA/milkTIA pool on Osmosis, enhancing the liquid staking experience for those who don’t want to wait for the long unbonding period. Beyond this, $milkTIA’s potential extends to various other domains:
- Lending Applications: milkTIA can serve as collateral in prominent lending protocols, including Mars Protocol and Umee, providing users with flexible financial options.
- Innovations in Staking Derivatives: It opens doors to the creation of unique staking derivatives, such as stakers’ baskets and leveraged staking positions. This innovation paves the way for more sophisticated investment strategies in the DeFi space.
- Perpetual Trading Platforms: Users can engage in perpetual trading on platforms like Levana and dYdX using $milkTIA, diversifying trading opportunities within the DeFi ecosystem.
- Utility in Celestia’s Ecosystem: $milkTIA has the potential to be used for payment of Blobspace and gas fees, thereby enhancing chain security and efficiency. If Celestia integrates milkTIA as a payment method for both these utilities, it would align interests and eliminate the need for chains to compromise staking to ensure TIA availability.
In conclusion, MilkyWay’s $milkTIA is not just another asset in the DeFi landscape; it’s a versatile tool that could reshape multiple facets of decentralized finance and blockchain utility in the Celestia ecosystem.
About Cosmostation
Cosmostation is a Celestia genesis validator and a key player in the Cosmos ecosystem, providing invaluable infrastructure legos essential for scaling and onboarding users onto blockchain networks. Through Mintscan, Cosmostation continues to drive the ethos of transparency and user-centric design, fostering a more insightful interaction with blockchain data across various networks. At Cosmostation, we bootstrap networks and onboard end-users.
Stake Celestia with MilkyWay and Cosmostation to help secure the Celestia network and get $TIA staking rewards!
