Following Ethereum's transition to Proof-of-Stake (PoS), a plethora of Liquid Stake Tokens (LSDs) have been introduced. These offerings provide ETH holders with the opportunity to earn yield without the complexities associated with operating a validator. This allows them to participate in the evolving ETH 2.0 ecosystem. Each LSD comes with a distinct set of advantages and disadvantages, including variations in yield rate (expressed in APR), degree of decentralization, and on-chain liquidity. This range of options empowers ETH holders to choose an LSD that aligns with their specific investment goals and risk tolerance.
xETH aims to be the best choice for getting exposure to LSTs and LRTs with four key elements:
Diversification across multiple LSTs, LRTs and ETH denominated LPs
Deep liquidity and tight slippage through xETH pools and AMOs
Higher risk adjusted yields through diversification
Overcollateralization and surplus to cover losses
Instead of running its own validators xETH integrates with the available options to provide the best aggregated product.