pSTAKE Finance: A Multi-Chain Liquid Staking Project Enters the BTC Staking Field

pSTAKE Finance is a multi-chain liquid staking project that launched its token in early 2022. The project initially focused on providing liquidity token staking services for the BSC chain and the Cosmos ecosystem, with a total locked value of (TVL) of approximately 7 million USD. Recently, pSTAKE collaborated with the BTC staking project Babylon to expand its business scope into the BTC staking field. Currently, over 90% of the project's tokens are in circulation, with a market cap of approximately 57 million USD.

Project Background and Financing History

The founders of pSTAKE have a background in Singapore and graduated from Nanyang Technological University. The project raised $10 million in angel funding in November 2021, with investments from several well-known institutions. In December of the same year, the project raised another $10 million through a public offering. In May 2022, the investment department of a well-known trading platform made a strategic investment in pSTAKE, though the specific amount and valuation were not disclosed. It is worth noting that the token price in the secondary market is now close to the seed round funding price, which is lower than the public offering price.

Token Economics

The total supply of pSTAKE tokens is 500 million, launched in February 2022. Currently, 93.6% of the tokens are in circulation. The remaining unreleased portion belongs to the team and is scheduled to be fully released by February 2025. The team tokens have an 18-month lock-up period, after which they will be released linearly over the next 18 months.

Latest Business Development

pSTAKE has recently shifted its focus to BTC re-staking and has partnered with the BTC staking protocol Babylon. This strategic adjustment closely follows current market trends and is expected to bring significant and sustained growth in TVL for the project.

Babylon is a Bitcoin staking protocol founded by Professor David Tse from Stanford University, and it has gained favor from several top crypto investment institutions. Currently, Babylon is still in the testing phase, and its mainnet launch may drive the business scale growth of related protocols.

In this new business, users can deposit BTC into pSTAKE to receive corresponding liquid staking tokens, participating in other DeFi projects to earn returns. Once the Babylon mainnet is launched, the BTC deposited into pSTAKE will be staked into the Babylon protocol, thereby earning additional rewards.

Market Performance and Valuation Analysis

Compared to other Ethereum re-staking protocols that have already launched on mainstream trading platforms, pSTAKE's valuation is relatively low. Factors affecting the project's valuation include narrative hype, business data, liquidity premium, financing valuation, and competitive advantages in the sector. Currently, pSTAKE's valuation is not much different from its previous institutional financing valuation, showing an overall undervalued state.

However, it is important to note that the current actual TVL scale of pSTAKE is relatively small, and there is still a considerable gap compared to mature Ethereum re-staking projects.

Summary

1. pSTAKE currently has a low market value and high token liquidity. Since its launch in February 2022, it has undergone a bear market baptism, and the current market price is close to the seed round private placement price, far below the public offering price.

2. The project has recently added BTC re-staking services, keeping up with market trends. The cooperation with Babylon may lead to rapid growth in business scale.

3. As a low market cap, high liquidity project with a new hot narrative and having received strategic investment from a major trading platform, pSTAKE may have the opportunity to be selected for the platform's public recruitment program for new coin listings.

4. The main risk is that the current TVL of pSTAKE is small, and its future development largely depends on the success of Babylon. At the same time, multiple protocols are collaborating with Babylon, and pSTAKE's competitive position in the BTC re-staking track is still unclear, which may lead to business growth that does not meet expectations.