Stellar Community Fund

By Chrysalis

Chrysalis

SCF #29

$49.0K

Legacy v5.0 Activation Award

Awarded

Chrysalis - turn Stellar assets into fluid opportunities, offering seamless liquidity and staking rewards on one dynamic platform.

Products & Services

Chrysalis is a liquid staking platform built on the Stellar network, designed to provide users with a seamless and efficient way to stake their XLM or ETH assets. By leveraging the power of Stellar's fast and low-cost transactions, Chrysalis enables users to convert their XLM into ETH, which is then staked on Lido, one of the most trusted staking protocols on Ethereum. This process allows users to earn passive income through staking rewards while also receiving rnETH, a representation of their staked ETH, which can be utilized within the broader DeFi ecosystem.

Chrysalis addresses several key problems:

1. Limited Staking Options on Stellar: Stellar users traditionally have fewer staking opportunities compared to other blockchain ecosystems. Chrysalis allows Stellar asset holders to convert their assets to ETH and participate in Ethereum's robust staking environment. 2. Illiquidity of Staked Assets: Staking typically locks assets, making them illiquid. Chrysalis provides rnETH tokens, which represent the staked ETH and can be traded or used in DeFi applications, ensuring users have liquidity even while their assets are staked. 3. Complexity of Cross-Chain Staking: Cross-chain interactions can be complex and costly. Chrysalis simplifies this process, offering a user-friendly interface and automated conversions, reducing the technical barriers for users wanting to stake across different blockchains.

Chrysalis is aimed at crypto enthusiasts and investors who hold XLM or ETH and are looking for ways to maximize their returns through staking. It appeals to users who value liquidity and want to leverage their assets in DeFi while still earning staking rewards. Additionally, it targets those who appreciate the efficiency and low transaction costs of the Stellar network.

Chrysalis integrates deeply with Stellar using smart contracts on Soroban, Stellar's native smart contract platform. Here’s a detailed look at the integration and architecture:

1. Asset Conversion: Users deposit XLM into the Chrysalis platform, where a smart contract automatically converts it into ETH using a decentralized exchange (DEX) integrated within the Stellar ecosystem. This conversion process leverages Stellar's fast and cost-effective transactions. 2. Staking Mechanism: Once converted, the ETH is staked on Lido via an inter-chain bridge. The staking process is handled by another set of smart contracts, ensuring secure and transparent transactions. Users receive rnETH tokens representing their staked ETH, which are issued on Stellar. 3. Liquidity and Rewards Management: rnETH tokens provide users with liquidity. These tokens can be traded on Stellar’s DEX or used in various DeFi protocols. Additionally, the staking rewards generated on Lido are periodically converted and distributed to rnETH holders through the Chrysalis platform, ensuring users benefit from their staked assets without needing to manage the complexities themselves. 4. Integration with Ecosystem Partners: Chrysalis integrates with various Stellar ecosystem partners for efficient asset conversion, secure staking, and liquidity management. Partnerships with Stellar anchors facilitate fiat on-ramps and off-ramps, enhancing the overall user experience by providing seamless entry and exit points for fiat currencies.

Chrysalis chose Stellar for several reasons:

1. Speed and Cost: Stellar’s network is known for its rapid transaction speeds and low fees, making it an ideal choice for frequent asset conversions and transfers. 2. Robust Ecosystem: Stellar’s growing ecosystem of anchors, wallets, and DEXs provides a solid foundation for building a comprehensive liquid staking platform. 3. Security and Transparency: Stellar’s commitment to security and transparency aligns with Chrysalis's mission to provide a trustworthy and reliable staking service. 4. Soroban Smart Contracts: Soroban’s powerful and flexible smart contract capabilities enable the complex logic required for Chrysalis’s cross-chain staking and liquidity management, ensuring a seamless user experience.