Reported by The Defiant, Rocket Pool's rETH is dominating trading volume among liquid staking tokens. Data from IntoTheBlock shows rETH accounting for more than half of the liquid staking sector's volume over the past three weeks. The token drove $28.8M worth of trades compared to stETH's $6.7M.
The data also shows increasing activity surrounding Frax's FrxETH and sFraxETH.
The surge in rETH activity could be attributed to the launch of Prisma Finance's LST-backed stablecoin, mkUSD, alongside adoption incentives in the form of its native PRISMA token, according to research by IntoTheBlock.
“We looked into it on-chain, and it appears that the spike in rETH volumes the past few weeks is linked to the launch of PRISMA,” said Lucas Outumuro, Head of Research at IntoTheBlock. “They increased the supply caps on Nov. 2 and launched their token as incentives for people to mint mkUSD through the protocol.
"This appears to have increased demand for rETH, with deposits into Prisma spiking that day.”
Outumouro added that the jump in rETH demand from Prisma users drove up the token’s price, opening up arbitrage strategies for opportunistic traders.
“There was a lot of volume since rETH was bought on the market, driving its price to a premium relative to its ETH holdings, and then more volume to arbitrage the price back down,” he said.
Liquid Staking Derivatives (LSD)