What is Picasso: The Solana Restaking Protocol

Restaking, an emerging concept on Ethereum, is set to expand to Solana through Picasso's Solana <> IBC connection. This method allows users to stake an asset, receive a receipt token, and then stake that receipt token again, enhancing potential yields and network security. Initially, SOL, mSOL, jitoSOL, and Orca LP tokens will be supported for restaking with Picasso's validators on trustless.zone. This article aims to explain Picasso and restaking concept in Solana.

A Brief Explanation of Restaking

Restaking is an innovative feature in cryptocurrency that enhances both the security and the potential earnings from staking tokens. It involves staking a native asset of a blockchain to the network's validators and receiving a receipt token in return. This receipt token can then be restaked, effectively allowing users to leverage their initial tokens for additional yield and support for proof-of-stake (PoS) validation twice over.

Read More: What is Restaking: A Complete Brief Guide on Restaking

EigenLayer is at the forefront of this movement, offering a protocol for restaking ETH on Ethereum. By enabling ETH holders to restake through its smart contracts, EigenLayer amplifies the crypto economic security across the ecosystem and addresses concerns about fragmented security. With over $275 million in total value locked, the demand for restaking is evident.

Although restaking has primarily been an Ethereum-centric development, its potential on other blockchains, like Solana, is significant. Solana, known for its extensive staking activities, sees around 370 million SOL staked, about 90% of its total circulating supply. This presents a vast opportunity for restaking, especially since Solana's receipt tokens, generated from staking, have yet to be fully utilized. The concept of restaking, therefore, stands as a promising avenue to leverage these assets further, pointing to a future where restaking could extend its benefits beyond Ethereum to other major blockchains.

Source: Solana Compass

Enter Picasso

Picasso initially launched in Kusama. It is at the forefront of enabling Inter-Blockchain Communication (IBC) to foster a dynamic ecosystem within Polkadot. Composable Cosmos was introduced to bridge these advancements to the Cosmos universe, streamlining the establishment of IBC links with Cosmos chains. Serving as an IBC hub, it integrates seamlessly with any IBC-enabled Cosmos chain, Picasso, and Ethereum, focusing on governance with the use of PICA, Picasso's native token, for validator staking and rewards.

A pivotal innovation is the introduction of restaking on Solana via the Picasso-Solana IBC connection, a leap forward in cross-chain collaboration. This feature allows for the staking and restaking of Solana’s native and receipt tokens, amplifying utility and security across the networks. With a significant portion of SOL already staked, the Solana ecosystem offers a ripe opportunity for restaking initiatives.

The collaboration between The Composable Foundation and the University of Lisbon, showcased at the Solana Breakpoint conference, unveiled the integration of Solana with the IBC Protocol. This integration opens the door to novel applications such as restaking and ensures a fluid exchange of liquidity across interconnected blockchains. To overcome technical hurdles, a guest blockchain solution on Solana enables IBC interactions with chains previously incompatible with IBC standards.

Picasso is expanding its range of staking options to include prominent tokens like SOL, mSOL, jitoSOL, and Orca LP Tokens, accessible through validators connected to the Solana-IBC bridge. This initiative is undergoing comprehensive security audits to guarantee its reliability and safety, with forthcoming results to ensure community and stakeholder confidence.

Currently, Picasso has 15,770 users and a total volume of $88 million with around 85,000 transactions.

Source: Picasso

Restaking through Picasso's Solana <> IBC Connection

Picasso is set to revolutionize the way we think about staking in the Solana ecosystem. By enabling both the staking of Solana's native SOL token and the restaking of various receipt tokens from SOL staking platforms, Picasso is expanding the horizons of asset utilization. Users will have the opportunity to engage with our Solana <> IBC validators by staking directly from trustless.zone. Here, assets deposited from digital wallets into our staking contracts are delegated to validators on a guest blockchain, supporting our IBC <> Solana bridge. This process not only upholds the principles of Proof of Stake (PoS) but significantly bolsters the security of our connection.

Staking with Picasso offers users the chance to earn rewards proportional to the amount and duration of their stake, allowing for compounded yields from both initial staking and restaking activities.

Here’s a glimpse into the assets ready for staking and restaking within Picasso’s Solana <> IBC validators ecosystem:

SOL: A substantial portion of SOL is already staked. However, a notable market remains for the unstaked SOL, which we are eager to incorporate alongside our restaking offerings.

mSOL: Marinade Finance’s mSOL introduces automated staking across Solana’s validator landscape, aiming to maximize user yields. mSOL stands as a fundamental component of Solana’s DeFi infrastructure.

jitoSOL: jitoSOL enriches Solana’s staking ecosystem by integrating MEV rewards, further enhancing staker returns. 

Orca LP Tokens: Orca's approach marries decentralized finance with philanthropy, rewarding liquidity providers while supporting climate change initiatives.

bSOL: Solblaze introduces an innovative liquid staking solution, allowing users instant liquidity and voting power through bSOL tokens. 

Conclusion

Picasso is pioneering the expansion of restaking from Ethereum to Solana, leveraging the Solana <> IBC connection to unlock new potentials in asset utilization and network security. By introducing restaking for SOL, mSOL, jitoSOL, and Orca LP tokens, Picasso not only enriches the staking landscape but also opens up novel avenues for earning and enhancing the security across blockchain ecosystems. With its innovative approach and ongoing security audits, Picasso is poised to significantly impact the DeFi space, offering users a compelling opportunity to maximize their yields and participate in a more secure, interconnected blockchain world.