Recently, someone asked me again where the returns from LST+ re-staking come from. To put it simply, the main sources are still the basic staking yields plus a bunch of "subsidies/points/re-distribution," not something that grows out of thin air. When subsidies are present, it looks quite attractive, but once they stop, the interest rate curve immediately changes, and the cost of funds on the lending side rises, causing your leverage position's liquidation line to suddenly become very close.

Don't just focus on price fluctuations for risk: LST de-pegging, withdrawal queuing, the contractual/operational risks of re-staking layers, and the chain reactions when liquidity in the lending market is drained—all of these can happen together. Especially these days, with extreme funding rates, whether to reverse the trend or keep squeezing the bubble in the group chat, I prefer to raise the health level, borrow less, and accept fewer profits.

See you next time.