Recently, I've seen everyone talking about LSTs and re-staking, and it feels like many people are treating the "extra returns" as if they’re picking it up from the air. To put it simply, money either comes from inflation/subsidies, or from someone paying fees to buy security/priority rights, or alternatively, splitting the same collateral into multiple layers to sell... The small returns you get is actually a package deal that includes complexity and tail risk.

The risks are pretty straightforward: one layer is contracts/escrows/bridges—things that can be wiped out with one mistake; another layer is penalties and confiscation/relevance (when everyone pushes in the same direction); and there's also the illusion of liquidity—normally you can sell, but when things go wrong, slippage can be like a floodgate opening. Recently, Meme coins and celebrities' calls for attention cause rotations, and newcomers tend to chase the hype and catch the last wave; LSTs are more like a "slow burn," but when they explode, they do so quietly and settle directly. Anyway, I personally prefer earning less and first figuring out the exit strategy.