Magma Launches Monad’s Flagship Liquid Staking Protocol

The Monad mainnet launch has been one of the most talked about blockchain launches over the last few years, touting its parallel execution and diehard community known as “Nads”.

However, each blockchain is only as useful as its support system, which in most decentralized blockchain ecosystems, is decentralized finance (DeFi).

One of the most popular, and typically largest by total value locked (TVL), protocol types is the liquid staking layer, where users can stake their network token, earn a small yield, and receive an equally valued receipt token that can be used elsewhere in DeFi.

Liquid staking tokens (LSTs) are often some of the first major integrations in new DeFi protocols within a network, making them versatile and easy to use, while boosting the user’s end yield and helping contribute to network security.

Magma is developing a MEV-powered liquid staking protocol for Monad, and looks poised to become a base layer of liquidity for the chain by being deeply integrated into Monad DeFi.

The protocol’s liquid staking token, gMON, looks to become a staple of Monad DeFi, while promoting efficiency, without sacrificing decentralization.

Notably, Magma will tout a 100% buyback and burn mechanism, a first for an LST.. The buyback program ensures full alignment with the Magma and Monad communities, and acts as the core of the ecosystem’s economic model.

The move not only ensures that protocol success helps fuel token success, but may set the standard for future liquid staking tokens (LSTs).

“Magma is setting a new standard for sustainable tokenomics and will be implanting the first 100% buyback and burn for an LST, cementing the importance of community ownership.” said David Mass, the co-founder of Hydrogen Labs.

MEV Power Engine

In addition to liquid staking, MEV, or maximal extractable value, serves as another key component within a blockchain ecosystem. MEV is a process where third-parties can scrape out additional value based on inefficiencies in pending blockchain transactions, by tipping miners with gas fees. By bribing these miners MEV manipulates the order of transactions in a block, and can be used to a more efficient market, or to take advantage of a counterparty.

Magma MEV can be broken down into three distinct stages, the searcher API, where bundles are submitted, the block engine, where bundle simulation and processing takes place, and finally the validator, where bundles are received and implemented into blocks.

Given Monad’s high throughput, Magma’s MEV is expected to outperform existing MEV processes from the likes of Ethereum, and focuses on reducing latency as much as possible by removing intermediary steps that take place on legacy blockchains.

The protocol also features a comprehensive MEV dashboard, displaying metrics such as MEV value over time, a livestream of blocks, as well as statistics such as total MON staked, total gas used, and number of transactions per block. Furthermore it will add a layer of gamification to the mix, with a “Searcher” dashboard that highlights the top performing addresses in terms of profit and bundles.

Community Focused

In line with Monad’s community-first approach, the Magma community, also referred to as the “DragoNads” - a spinoff of Monad’s “Nads” - are at the forefront of Magma’s development and brand strategy. The DragoNads are a key component of the Nads community by being one of the first groups to commit to building on Monad.

Over the summer, Magma also released its flagship NFT collection on Monad Testnet, a collection of 3,000 dragon NFTs known as ROARRRS. The collection minted via Magic Eden in July, and users were able to mint on a first come first serve (FCFS) basis.

In addition to the ROARRRS, there are 300 SCALEs, which represent the rarest collectibles within the Magma ecosystem. SCALEs were distributed to committed community members, top stakers, and partner projects to ensure a curated selection of holders. Together the ROARRRS and SCALEs serve as proof of community (POC) tokens.

The launch of the ROARRRS marked the first onchain gathering of the DragoNads as the community looks forward to Monad and Magma’s mainnet phase, which is expected in Q4 2025.

As mainnet approaches, Magma is continuing to use its resources to further development. The protocol raised $4.2 million in a round featuring an array of venture capitalist firms including CMS Holdings, Maelstrom, and Animoca, as well as a community round on Echo. The protocol aims to become a mainstay for the Monad ecosystem, by offering two of DeFi’s most important ecosystem functions, liquid staking and MEV.

As the DragoNads gear up for the upcoming Monad mainnet launch, investors and stakeholders are looking forward to Magma's next steps.

Theo Fields, a general partner at Bloccelerate, spoke on the upcoming mainnet launch and said “The Magma team had the early conviction to build natively on Monad before almost anyone else, meaning they were ready to serve a community with a LOT of pent up demand and interest. That conviction plus outstanding product execution led to exceptional testnet traction and Magma becoming a top protocol on testnet.”

“I’m excited for what’s next- Magma’s roadmap will continue to drive their user growth and will set them up to be the dominant long-term LST.“ Fields concluded.

Bloccelerate is an investor in the development team behind Magma, Hydrogen Labs, as well as an array of other top DeFi companies such as EigenLayer, Tally, and Hedera.