Liquidity staking allows users to earn rewards by participating in a blockchain’s staking process while still retaining access to their assets. When users stake their tokens to support network operations, they typically lock them up for a certain period, losing the ability to use or trade them.With liquidity staking, users can receive a tokenized representation of the staked assets, often referred to as a “liquid token.” This liquid token can be traded or utilized in other DeFi applications, effectively creating liquidity despite the original assets being staked.The key advantage is that it combines the benefits of staking—like earning rewards for supporting the network—with the flexibility of liquidity. Users can still engage in trading or other financial activities while their assets contribute to securing the network. As DeFi continues to evolve, liquidity staking has become an appealing option for those looking to maximize their returns without sacrificing access to their assets.