How Does PoSL Work?

At the heart of Bedrock’s Proof of Staking Liquidity (PoSL) lies a self-sustaining flywheel that continuously drives growth, liquidity, and value creation throughout the ecosystem. The cycle begins when users stake their assets into the protocol, earning BR tokens as rewards. This staking activity enhances liquidity within the Bedrock ecosystem, ensuring efficient capital flow and enabling deeper participation across multiple chains. As liquidity providers and stakers earn BR, they are motivated to engage more actively with the protocol, which in turn strengthens the liquidity base even further.

Holders of BR tokens have the opportunity to convert their tokens into veBR, unlocking a more powerful role in governance and rewards. This conversion reduces the circulating supply of BR, creating a natural scarcity. In exchange, veBR holders gain governance rights, allowing them to vote on important protocol decisions such as BR emissions and upgrades. This governance layer ensures decisions are made collectively and aligned with the long-term interests of the ecosystem, fostering a collaborative approach to protocol growth.

As the protocol generates revenue through its operations and cross-chain integrations, a portion of these funds is used to buy back BR tokens as determined by veBR holders. These buybacks further enhance scarcity, increasing the value of BR and applying upward pressure on its price. This drives greater demand for both BR and veBR, as participants seek to leverage the growing utility and scarcity of the tokens. With more users engaging in staking, governance, and liquidity provision, the cycle accelerates—creating a positive feedback loop that amplifies Bedrock’s growth. As demand rises, liquidity deepens, governance becomes more decentralized, and the ecosystem grows increasingly resilient, fueling the next evolution of staking.

• Dynamic Rewards Based on Liquidity Users who stake assets like uniBTC, uniETH, and uniIOTX contribute to network security and stability. But instead of static restaking rewards, PoSL introduces a dynamic rewards layer that adjusts based on liquidity conditions.

• Seamless Liquidity Integration PoSL rewards participants who provide liquidity, ensuring that yield generation remains sustainable across multiple DeFi strategies. Rather than treating liquidity provisioning as a separate function, PoSL integrates it directly into the restaking process, creating a seamless, compounding reward system.

• Incentivizing Active Participation with BR Tokens PoSL also incentivizes users who actively contribute to liquid staking ecosystems by distributing BR tokens, which act as a multi-purpose yield and governance asset.

For DeFi enthusiasts, PoSL offers a fairer, more sustainable, and dynamic liquid restaking model that incentivizes both liquidity providers and long-term ecosystem participants. It also allows users to actively shape the protocol’s future rather than just collecting passive rewards.