IOTA DeFi Ecosystem Expands as Swirl Launches Liquid Staking

• Swirl’s liquid staking on IOTA lets users earn daily rewards while keeping tokens tradable or usable in DeFi.
• Users get stIOTA instantly after staking, allowing selling, lending, or redeeming anytime without waiting for lock periods.

Swirl has launched its liquid staking platform on the mainnet of IOTA, offering a new way for holders of IOTA tokens to receive rewards while maintaining liquidity access. Revealed by a press release, Swirl is an autonomous ecosystem project on the IOTA network that permits staking of IOTA and rewards stIOTA back to the holder.

A warm welcome to @swirlstake! With the new stIOTA, you can help secure the network all while keeping your tokens active in th IOTA DeFi landscape. No lockups or unstaking periods. Check them out now https://t.co/OgxZeYDZwN

— IOTA (@iota) May 7, 2025

The stIOTA tokens ensure liquidity with the provision for users to sell them, use them as collateral for decentralized finance applications, or receive additional rewards without the need for staking periods to lapse. This aspect makes the members no longer bound by locked tokens and able to leverage their assets across DeFi options from IOTA.

Swirl’s system is based on the decentralized contract network of IOTA and uses Move-based smart contracts to control staking operations. This makes the operations transparent and viewable to anyone for auditing. In the long run, the project is supposed to move toward higher levels of decentralization as the staking mechanism of IOTA grows and matures.

Swirl Overcomes Staking Limit — Get stIOTA Immediately

In the current stage, a number of principal components, including validator governance and back-end processes, are being regulated via MultiSignature Wallets, the team said. These controls are likely to relax as the project decentralizes. Asphere, an enterprise services spinoff of Ankr, contributed to the development of Swirl and is still helping with validator node management.

Asphere’s validator network, which has aided companies like Microsoft, Binance, and Polygon, is supposed to ensure a stable and reliable staking ecosystem for the people using Swirl, the announcement added. It is made with the view to make the system more robust and ensure that the protocol runs smoothly for the participants.

The Swirl platform aims to overcome a major disadvantage of conventional staking models, where tokens get staked and are unavailable for their staking term. When using Swirl’s design, customers receive stIOTA immediately after they have staked their IOTA so that they can exchange them later for the initial IOTA along with rewards, trade them on exchanges, or utilize them within other DeFi applications.

Swirl Offers Up to 15% APR

The team highlights that users profit from accessing liquidity without giving up staking rewards. Yield farming, arbitrage options, and lending become available without compromising on staking rewards. Swirl has a function called instant unstaking as well: by destroying their stIOTA tokens, the holders may redeem their IOTA anytime they want.

Staking on Swirl has automatic rewards that come with a daily return, and it posts an annual percentage return of 10% to 15%. It allows users to capitalize on stIOTA within the DeFi ecosystem of IOTA, ranging from trading on decentralized exchanges to liquidity mining. This format allows participants to multiply their income potential using various strategies without losing liquidity.

Swirl’s launch of liquid staking has come after IOTA’s recent upgrade of the Rebased Protocol, which was implemented on 5 May. The upgrade signaled the end of the Stardust network for IOTA, as it transitioned into a Move-based object ledger. The development team termed the move as the biggest, most complicated, and most crucial upgrade ever to be done.