gVaults are live on Monad.

gVaults are the first validator-specific liquid staking outside of Lido V3, designed from first principles around how the Monad ecosystem is expected to evolve. gVaults introduce validator-specific delegation without fragmenting liquidity. Users can stake directly to a chosen validator while receiving the same fungible $gMON token used across Magma’s integrations.

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Validator-level staking without breaking the liquidity layer

Magma is enabling the first-ever institutional-grade staking infrastructure on Monad. Validators who join now are establishing a footprint before the network scales.

Most liquid staking systems aggregate deposits into a shared pool where attribution to individual validators fades into the background. That model is operationally clean, but it also removes visibility and flexibility for both stakers and operators.

With gVaults, deposits made through a validator vault are delegated directly to that validator while still minting the same $gMON token as the rest of the protocol. In practice this means a staker can know where their stake sits without stepping outside the broader liquidity environment.

Institutional access without basket ambiguity

In our many conversations with validators and institutional allocators, we noticed a recurring theme that kept on surfacing: pooled delegation can complicate underwriting decisions when counterparty visibility and infrastructure control matter. In traditional pooled staking models, capital is spread across a basket of validators, which then makes it harder for allocators to assess where operational risk actually sits.

For institutions that perform internal due diligence on infrastructure providers, that abstraction becomes problematic. Investment committees need to understand exactly which validator is responsible for securing the stake, what their operational track record looks like, and how risk is distributed across counterparties to be able to make a decision on how to proceed with capital allocation.

gVaults’ structure maps more naturally to those requirements as it allows institutions to delegate to a validator they previously vetted while receiving $gMON and maintaining full liquidity within the broader ecosystem. As a result, validator-specific exposure and liquid staking, can coexist within the same system.

This structure also improves operational clarity. As risk attribution becomes easier to model, reporting becomes simpler, and allocations can be aligned more closely with internal mandates or counterparty limits. At the same time, capital remains inside Magma’s liquidity layer, allowing institutions to retain the flexibility that liquid staking provides.

Practically this change is relatively small but for allocators who treat validator infrastructure as a real counterparty risk, it removes a surprising amount of ambiguity.

Designed for Monad

Staking vault models introduce a set of constraints that become obvious once you model them seriously. Concentrated exposure to a single validator increases slashing impact. Multiple liquidity flows can diverge during stress events and correlated behavior can emerge across vaults when market conditions tighten. Our developers have identified that these are not edge cases but design realities and so our approach was designed specifically to mitigate these risks.

Validator participation in gVaults is gated through a whitelisting framework based on performance history and operational standards. Relative deposit caps, based on relative stake to total protocol TVL, limit concentration while leaving room for growth where demand is demonstrated. Deposit caps and validator screening are designed to limit the impact of any single validator while preserving token fungibility and system stability.

If a validator underperforms or falls below thresholds, they can be removed from the set and whilst that mechanism is not particularly novel, it is an important presence in our current approach.

Capital efficiency without additional overhead

Traditional vault implementations address risk through over‑collateralization, effectively asking participants to lock more capital than is actively staked as a protective buffer. The trade‑off here is additional safety margin at the cost of efficiency.

gVaults instead rely on validator screening, exposure limits, and system safeguards to manage similar constraints without introducing additional idle capital requirements.

Ease of use for max efficiency

For validators, the experience is intentionally light-touch. Each operator receives a customized deposit portal inside Magma’s interface that can be shared directly with their network. Deposits made through that portal are delegated fully to the associated validator while still minting $gMON at the same rate as deposits made into the Core Vault, ensuring parity across the system. There is no contract deployment, no additional integration work, and no parallel infrastructure stack to maintain — the vault becomes part of the system rather than something separate.

Participation in gVaults sits within a structured validator framework with strict participation parameters and operational standards that are under continuous review by our team.

Redeemability as a baseline expectation

Maintaining predictable redemption pathways remains a core constraint for any liquid staking design. Under extreme liquidity fragmentation, the protocol may perform controlled rebalancing between gVaults and the Core Vault to preserve fungibility and orderly redemption. This mechanism is designed as an infrequent safeguard rather than a routine operation.

Participants retain their $gMON position, with system adjustments occurring only where necessary to maintain protocol‑level redeemability.

Security review and simplification

When we announced that we were building gVaults, the architecture had already undergone independent security reviews by Cantina, Halborn, Zellic, and Zenith, as part of our complete project audit. In the months since we have submitted all our gVaults contract for a second round of reviews, complementing internal simplification work that preceded final audit cycles.

That simplification step was arguably as important as the audits themselves; removing complexity often reduces risk more effectively than layering additional mechanisms. As security is one of the values that we hold dear the most, this was a non-negotiable to satisfy our high level of standards.

Positioning within Monad’s trajectory

As the Monad ecosystem matures, validator differentiation, institutional participation, and liquidity composability are likely to become increasingly intertwined. Through that lens, gVaults are best understood as just one component of a broader staking infrastructure direction, instead of a just singular solution.

Validators now have a path to potentially 10x revenue on delegated stake without compromising liquidity. By enabling validator-level staking without sacrificing liquidity cohesion, gVaults aim to support that direction early rather than retroactively adapting to it.

Our first validator cohort will consist of DTEAM, Pathrock Network, ITRocket, Forest Staking, Provalidator, Rhinostake, Polkachu, Moonlet, Node Monster, Stakely, NodeInfra, Crouton, Stakecito, Enigma, Stakeme, Cosmos Spaces, Spectrum Staking, Flipside, Nodes Guru, Lavender Five, Staking4All, Coinage X DAIC, Chainlayer, Blockscape, SimplyStaking, DSRV, Chorus One, Everstake, P2P.org, P-OPS, Go2Pro, LakeStake, Stakeus, Cassini Living, Stake Shark, Lux8, Stakin, Allnodes, Stakecraft. This group reflects the performance standards and operational rigor required to participate in gVaults.

With gVaults now live, staking vaults will become part of the network’s day-to-day infrastructure: imperfect, evolving, and now observable in practice.

Today, we introduce Season 1 of our long-awaited Points Program. You can earn points while powering DeFi across Monad. Let’s dig in.

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What Are Magma Points?

Magma Points are earned through staking $MON for $gMON, holding Magma NFTs (ROARRRs and SCALEs), maintaining Magma Discord roles, and actively engaging with partnered projects across the Monad ecosystem using your $gMON. Points are not just rewards ,they represent your long-term commitment, loyalty, and contribution to Magma and our ecosystem.

• You can start tracking them right here: https://www.magmastaking.xyz/points

• You can view all the DeFi opportunities that we are incentivizing and other opportunities on our DeFi page: https://www.magmastaking.xyz/defi

• Note- some markets might not be available immediately, so keep up to date on our DeFi page

Our points program is built on the following elements which we will explain in detail.

• Staking Power: The biggest driver of Magma Points is your gMON staking position. The more you stake and the longer you stay staked, the more points you accumulate.

• Time Commitment Matters: Consistency is rewarded. Frequent unstaking reduces points momentum, while long-term staking increases accumulation.

• Ecosystem Multipliers: Ecosystem partners such as NFT projects, DeFi protocols, and Web3 games are assigned multiplier tiers. Users holding or interacting with these projects receive enhanced point multipliers

• NFT Ecosystem: Holders of mainnet ROARRRs and SCALEs NFTs, launched with Magic Eden, receive a top tier multiplier.

How Points are Earned

Magma Points are automatically earned and calculated based on your gMON on-chain activity, NFT alignment and community roles.

1. Stake gMON

Earn base points simply by staking $MON for $gMON. The longer you remain staked, the higher your point momentum becomes.

Multiplier: 1x

You can start staking here 👉 : https://www.magmastaking.xyz/

2. Hold gMON

Holding gMON in your wallet continues to earn you points, even when not actively used.
Multiplier: 1x

3. Provide Liquidity

• Supply gMON/USDC liquidity on the following DEX’s (4x Multiplier)

  • PancakeSwap

    Multiplier: 4x

• Supply gMON/MON liquidity on the following decentralized exchanges:

  • Kuru, Uniswap, Monday Trade, PancakeSwap, Curve, Atlantis DEX, Bean
    Multiplier: 3x

4. Lending

• Lend your gMON on the following money market

  • Curvance

    Multiplier: 3.5x

• Lend your gMON on any of the following money markets

  • Morpho, Curvance, Euler, Neverland, Folks Finance, Townsquare,
    Multiplier: 3x

5. Staking Vault

Stake gMON into various vaults : Enjoyoors, Atlantis DEX, Covenant
Multiplier: 1x

6. Collateral

Use gMON as collateral to mint stablecoins: Monata
Multiplier: 2x

NFT Collaborations and Magma Points

Holding certain NFTs while you hold gMON earns you the following multipliers. Only your highest NFT multiplier applies.

• Some NFTs might not be available on Mainnet yet, but once they become available, the following boosts will be offered

• NFT Multipliers do NOT stack. If multiple NFTs are held, only the highest multiplier is applied.

Magma Points are designed to go beyond simple reward mechanics. They represent your true Proof of Community, your status, your commitment, and your future-proofed value within the Monad ecosystem.

Seasons-Based Points Evolution

Magma Points operate in seasons.

• Season 1 has already launched as of Monday, November 24 for any markets that are live
  

• After each season, all partner projects, multipliers, and indexes will be reevaluated, ensuring that emerging, high-quality projects can ascend tiers keeping Magma aligned with the most impactful builders.
  

• Upon mainnet launch, community members will receive an initial points allocation based on their Discord roles. With this allocation we recognize early supporters, contributors, and high-value community members.

The Magma Points Program is a system built to reward meaningful and long term contribution.

🌋 Stake MON. Get $gMON. Earn Yield. Earn Points.

👉 Start staking on Magma NOW

Follow us on X for more information or join our Discord and be part of the eruption!

Disclaimer:

Magma does not provide financial advice. All information shared, including details about Magma Points and $gMON, is for general educational purposes only and should not be considered a guarantee of future rewards or outcomes. Users are solely responsible for verifying the authenticity and security of any platform or smart contract they choose to interact with, including confirming that they are using the correct domain before connecting their wallet. Participation is entirely at your own risk.

🔥 Magma is officially live on Monad Mainnet🔥

Dragonads, the time has finally arrived. After more than 24 months of building, testing, and community collaboration, the wait is over. Magma allows users to stake their $MON, generate yield and earn points while powering DeFi across Monad with $gMON. Let’s dig in.

Stake your $MON HERE for $gMON to start earning staking yield AND points

Token: $gMON
Contract Address: 0x8498312A6B3CbD158bf0c93AbdCF29E6e4F55081
Decimals: 18

Check out the step-for-step tutorial below:

Step 1: Set Up Your Wallet

If you don’t have a wallet, create one with MetaMask, Phantom or another listed provider.

Follow this setup guide if you need help.

Step 2: Connect to Monad

Open the Magma portal: https://www.magmastaking.xyz

Click “CONNECT WALLET” and select MetaMask.

If prompted with “WRONG NETWORK,” select “Switch to Monad” in the dropdown menu.

Step 3: Stake Your $MON

To stake, first go to the stake dashboard and select the amount of $MON you want to stake. To see how much you have, check your wallet or check the dashboard. It will show you the total amount of $MON currently in your wallet that is available for staking.

After clicking stake, wait until the process wheel stops spinning and you will receive a confirmation on your screen informing you that the transaction was successful and $gMON was deposited in your wallet.

Click “here” to add $gMON to your wallet so it is visible upon opening your wallet right away.

Congratulations DragoNad, you have successfully supercharged Monad and received the Magma LST $gMON. You are currently earning yield and points. Sit back and enjoy.

Step 4: Unstake Your $MON

On the dashboard, click “Unstake.”

You’ll see the amount of $gMON available for unstaking, either in your wallet or directly on the dashboard. Enter the amount of $gMON you’d like to unstake and click “Unstake.”

Wait until the progress wheel finishes and a confirmation message appears. Once confirmed, your $MON (plus any yield) will be returned to your wallet. You can choose to hold it, restake it, or use it elsewhere.

What Is Magma?

Magma was one of the first native projects to start building on Monad, pioneering liquid staking from day one. Our mission is simple but powerful:

• Empower users with liquidity and yield.

• Strengthen Monad with decentralized, community-driven staking.

• Scale $gMON everywhere, making it the core building block of Monad DeFi.

Yield and Points

With Mainnet live, Magma will unlock the full potential of staking on Monad:

✅ Live Yield Accrual: Your $gMON accrues staking rewards directly from our high quality validator set.

⚡ MEV Optimization: Magma is going to leverage the fastest block engine in crypto, ensuring fair, efficient, and optimized yield capture. Our MEV will be activated shortly after mainnet.

🎯 Magma Points: Users are already earning Magma points for certain actions with our partners. Putting your $gMON to work by simply staking or using it in DeFi will earn you points. Points recognize early adopters and active contributors, creating long-term alignment between Magma and its users. More on this very soon!

You can track your points here: https://www.magmastaking.xyz/points

🌍 $gMON Everywhere: Magma is committed to driving adoption. Expect to see $gMON integrated across Monad DeFi, making it the foundation of liquidity, lending, trading and so much more.

How will our MEV work?

Our MEV north star is to reduce the number of intermediaries in the MEV process and get as close as possible to having direct communication between searchers and validators. Typical MEV flows can consist of 2-3 intermediary steps between a searcher submitting a transaction and a transaction being included in a block. Reducing the number of steps has practical benefits: with one-second block times, each additional intermediary step in the MEV process increases network latency.

We aim to leverage the latest technologies to create an MEV architecture where searchers can send their transactions directly to validators. In our journey toward this goal, we strive to reduce intermediaries and associated latency in the MEV flow. This approach offers several benefits: it provides searchers with more time to submit their transactions, thereby opening up the MEV space to less sophisticated players for whom speed is not the most critical factor. Additionally, it enhances privacy and reduces the risk of censorship by eliminating intermediaries, thus establishing a direct marketplace between searchers and validators. Lastly, our pillars of MEV design prioritizes users by focusing on privacy, protection from bad MEV, and minimizing latency.

All of this will be powered by the fastest block engine in Web3. We will deploy our MEV dashboard on Mainnet once MEV is live; we are committed to transparency and sharing information for the benefit of improvement.

Security

Magma has completed 4 audits with leading auditors: Halborn, Zellic, Cantina and Zenith. View our audit reports on our GitBook

Why Join Magma?

Staking is no longer about locking away your tokens and waiting. With Magma you can:

Stay Liquid: Your $MON works for you while $gMON flows through DeFi.

Earn Points: Earn native Magma points.

Staking Yield: Capture leading staking yield

MEV Yield (coming soon): MEV-optimized performance designed to boost returns

Build Status: Proof of Community points give recognition and future rewards to the most active Nads.

Lead the Movement: As Monad expands, $gMON adoption is set to define the ecosystem with Dragonads at the forefront.

TL;DR on Magma’s Mainnet arc

1. Connect your wallet: Go to magmastaking.xyz and connect MetaMask or any other supported wallet.

2. Stake MON: Deposit MON into Magma.

3. Receive $gMON: Instantly liquid, instantly usable.

4. Earn Yield: Watch your staking rewards grow in real time.

5. Earn Points: Every move you make with Magma will count toward Proof of Community.

6. MEV coming soon: We will bring you boosted yield when our MEV goes live shortly after mainnet.

For the DragoNads

From the very first Discord message, to the earliest testnet wallets, to the feedback, bug reports, and community energy, you’ve made this possible. Mainnet is OUR victory.

Being part of a community, a DragoNad, means more than using $gMON; it means proving, once again, that DragoNads are Nads. This one is for you, the people of Magma..

The Future Is HOT Like Magma

Magma Mainnet is here. The future is liquid, fast, and community-driven. Together, we’ll take $gMON to every corner of the Monad Universe

🌋 Deposit MON. Get $gMON. Earn Yield. Earn Points.

👉 Start staking NOW

Magma’s v2 contract release incorporates gVaults, a Staking Vaults innovation that expands the frontier of staking infrastructure on Monad. With gVaults, users can choose to stake with one specific validator. This means they will only be exposed to the slashing risk of their selected validator. This feature allows validators to refer their existing customers to enjoy the benefits of liquid staking while retaining stake on their validator. Institutional clients are able to access validator setups with compliance requirements while providing the operational control they need to underwrite participation.

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gVaults are the onramp for institutional staking on Monad.

The breakthrough of gVaults lies in retaining fungibility among vaults. Some protocols on other chains have designed systems where each validator effectively releases its own LST. However, this non-fungibility lowers the utility of the LST and increases liquidity fragmentation. gVaults mints the same fungible gMON LST for each depositor. This allows depositors to benefit from all of the many DeFi integrations that are powered by gMON.

Validator Selection

To mitigate against validator underperformance, only gVault whitelisted validators may be delegated towards. There are relative total deposit caps on the amount of MON that may be staked to a particular validator with the default being 0.25% of the total assets of Magma. Validators can apply to have this cap raised in certain conditions where there is demonstrated demand. The cap ensures that if one gVault whitelisted validator is slashed, the slashing loss can be safely socialized across the protocol without significantly lowering the total assets.

We are partnering with a cohort of world class validators including: Chorus One, P2P, Everstake, Simply Staking, Chainlayer, Dteam, Pathrock, Stakely, Blockvision, Node Infra, Blockscape Lab and Forest Staking to launch gVaults. Our selection process is unwaveringly stringent, and we only support validators with a track record and pledge to uphold certain performance metrics. Validators that fail to uphold minimum performance metrics will be removed from the whitelisted set.

With these measures, Magma again commits to their vision of providing Liquid Staking on Monad that is secure, decentralized and stable.

Custom Deposit Portals for Validators

Each validator will receive a customized deposit UI on the Magma site that they share with their clients. The custom deposit UI will be branded for the validator and 100% of MON staked through the UI will be delegated to the validator. Users can manage positions for their gVault deposits and redeem at any time.

Institutions are here

In our conversations with leading validators and institutional funds over the past years, we’ve consistently heard requests for a customizable feature like this. We listened to their feedback, and today we are live on Monad testnet with our production-ready staking vaults platform, which is the third of its kind in all of crypto as of writing this article.

At Magma, we’ve always had an ambitious tech roadmap. Whether it’s our unbeatable low latency performance on MEV, our R&D program towards DVT, or our exceptional decentralized governance roadmap, we remain committed to continue pioneering real innovation on Monad.

We’re thrilled to announce that the Searcher API (stage 1) and Block Engine (stage 2) of Magma MEV have been successfully deployed on Monad testnet. Alongside this milestone, we are releasing our dashboard which simulates and visualizes the MEV process live on testnet.

This announcement marks significant progress towards our first MEV north star goal: Removing PBS (Proposer-Builder Separation) and the associated latency between relayers and proposers. Our performance metrics on testnet have been outstanding, and we can now say that we are running the most competitive block engine in crypto. In summary, the successful completion of stage 1 and stage 2 MEV development means that Magma MEV will allow searchers optimal timing to find arbitrage opportunities, generating optimal yield for validators and stakers.

Magma MEV Dashboard

Our MEV dashboard simulates and visualizes the flow of MEV bundles on Monad testnet. A cohort of example searcher bots are programmed to submit bundles for arbitrage opportunities every 100 blocks on Monad testnet. These arbitrage opportunities allow the searcher to profit from DEX mispricings of an example token on Pancakeswap. For now, the transactions are posted to Moand testnet through a normal broadcast. The next step of the process will be to implement the MEV sidecar, similar to MEV-boost on ethereum, that will allow searchers to send these transactions as bundles through the block engine.

View dashboard→

MEV Overview

Magma MEV consists of three stages. The first is the searcher API, where searchers submit bundles to the Block Engine. The second stage is the block engine, where bundles are processed and simulated to provide revert protection. The third is the validator sidecar, where bundles are received from the block engine and included in blocks produced by the validator. As of today, stage 1 and stage 2 are live on mainnet. Stage 3 is pending final development.

Transaction simulation and revert protection

One of the key benefits that we are able to offer with Magma MEV is transaction simulation and revert protection. This is done by the block engine. The benefits of these features are significant for preventing failed transactions, optimizing block space, and selecting maximally profitable bundles. These benefits ultimately transfer both to validators and gMON stakers. Our block engine is rust-based and highly performant, able to simulate blocks on Monad testnet in single digit millisecond times.

Importance of low-latency in MEV process

Our MEV north star is reducing latency and intermediary steps in the MEV process. On a high throughput chain such as Monad, this is crucial as searchers have a very limited time to submit bundles (less than half a second). Every extra millisecond we can give to searchers to submit their bundles allows them to find and profit from more arbitrage strategies. Our MEV process contains significantly fewer intermediaries than the Ethereum MEV process and is closer in design to Jito on Solana. Magma MEV is posed to redefine low-latency MEV processing, bringing us closer to empowering searchers, validators, and stakers with optimal arbitrage and yield opportunities.

Ready to turn your $gMON into glory? Magma just turned up the heat with Nad or No Nad, the high-stakes game where bold decisions and a sprinkle of luck could multiply your $gMON stash.

Inspired by the thrill of “Deal or No Deal,” this isn’t just another click-and-win. It’s a nerve-wracking game of choices, suspense, and rewards—powered by Pyth Entropy for verifiable randomness and crafted entirely in-house by the Magma team.

🎮 Play Now: nad.magmastaking.xyz

How It Works

• Get things started- Step 1: Place your bet using $gMON. Wager 1 $gMON, 10 $gMON, or 100 $gMON to enter the game.
  

• Open the vaults- Step 2: Open the chest and reveal the amounts inside each vault with a potential $gMON prize inside. As you open them, those values are eliminated from the prize pool, narrowing down your possible final outcome.
  

• Face the Banker’s Offer- Step 3: At key moments, the mysterious “Banker” will tempt you with a deal to cash out early. Accept with “Deal” to lock in the offer, or say “No Deal” to keep opening vaults and chase a bigger prize.

  • You can take the deal and secure your prize

  • Turn the deal down, and keep opening vaults to chase a bigger prize
    

• Claim your reward- Step 4: No matter what, you’ll walk away with a $gMON prize. If you reject all the Banker’s offers, you’ll take home the final vault’s value.

Fair Play, Magma Style

We know what you’re thinking: Is this legit? Absolutely. Nad or No Nad uses Pyth Entropy (a Verifiable Random Function) to ensure that every outcome is transparent, random, and fair. Your win isn’t left to shady algorithms, just pure blockchain fundamentals and trust at work.

Why You’ll Love It

✔ Massive Multipliers: Bet small, win big.
✔ Pure Magma Heat: Designed in-house to keep the fire alive.
✔ No Waiting Around: Instant excitement, instant results.

🔥 Show Off Your Nads!

Win big? Take that screenshot and flex it on X, tag @MagmaStaking and show the world how hot your $gMON streak is. The boldest wins will get a QT —and if absolutely epic, we might throw in something even better.

The lava is flowing, the treasure chests are glowing, and the question burning in your mind is:

Will you Nad… or No Nad?

🎮 Play now: nad.magmastaking.xyz
⚡ Follow us for updates: X (Twitter) | Discord

Magma has been aligning ourselves directly with our community on Monad since day one. We’ve also been focused on innovation, not afraid to push the frontier on what’s been done before in the LST space. Magma is a project full of firsts - the first high-throughput DV, novel approaches to MEV, our Proof of Community among many other innovations. Today we are excited to unveil a protocol feature that is both radical and fully aligned with our community. Magma is the first LST in crypto to offer a 100% buyback-and-burn from all staking fees.

The Success of Buybacks

Buybacks have been successfully employed by a number of leading protocols, including Binance, MakerDAO, Aave, Ether.fi, and OKX among many others. Buybacks reduce circulating supply, leading to more sustainable economics. For instance, in early March 2025, the lending platform Aave (AAVE) introduced an updated version of its Aavenomics. The new model involves repurchasing tokens to decrease supply while transitioning from staking rewards to a more sustainable liquidity approach. As part of this shift, Aave committed to weekly token buybacks totaling $1 million over a six-month period, financed through protocol-generated fees. If fully executed, the plan could amount to $100 million in buybacks—approximately 3% of AAVE's circulating supply.

Another project that has utilized buybacks extensively is Hyperliquid. Hyperliquid became a community favorite in part due to their buyback and burn program, which earned them the trust of the community. One recent analysis of HYPE’s economic model showed that HYPE currently converts 54% of the platform’s gross profit and 100% of its net profit into buybacks or token burns for HYPE.

Power of the Burn

In the past, some have suggested that projects shouldn’t burn, and rather should use buybacks to “build”. Today this position is barely tenable. Forcing stakeholders to trust centralized teams to make correct decisions with large stockpiles of funds creates misaligned incentives. Historically, crypto protocols that have accumulated large treasuries have often struggled to deploy those funds in ways that demonstrably advance long-term protocol development. Empirical observations suggest that such treasuries frequently lead to inefficiencies, organizational bloat, or speculative financial strategies rather than focused investment in core infrastructure or user growth. There are plenty of case studies to support this conclusion such as EOS and Tezos, both of which accumulated large treasuries under control of a centralized team whose interests and actions did not align with the community.

For projects with real decentralized governance, there is limited practical ability to direct these revenue stockpiles back towards uses that will actually create long term sustainable value add for the protocol. Governance funding has been systemically inefficient, as we have seen with DAOs such as Aragon, Optimism and Arbitrum that had well publicized problems effectively deploying capital towards useful development.

We believe that buybacks alone are not enough. Burning introduces a certainty in the process otherwise lacking. If a protocol gathers a large stockpile of buybacks, but does not burn, it creates new questions and uncertainties about what will happen with those buybacks. We’ve seen governance expenditures throughout crypto fail to deliver lasting value for protocols. Community members should be skeptical, after all, one of the favorite motto’s in crypto is “don’t trust, verify”.

Trend Towards Sound Economics in DeFi

The new meta in crypto is sound economics. We’ve seen from protocols like Katana designed completely around this. At the core of sound economics is ensuring that all stakeholders in a team are balanced and aligned. This takes shape in many ways, from offering retail participants equal opportunities as offered to insiders, to designing a protocol with a sustainable business model, and finally to designing an economic policy such as buyback-and-burn that can create a sustainable flywheel for growth.

Too many projects today have a principal-agent problem between their own team and communities. Too many projects choose predatory token economics or TGE launch strategies such as low-float-high-FDV. Too many projects become bloated and inefficient, and fail to support their community members and earliest supporters. At Magma we are committed to stand firmly in the camp of sound economics.

Protocol Fees

Magma is committed to a 100% buyback-and-burn of all net staking fees generated. When users stake with Magma, there is no fee charged on their principal MON deposits. Magma takes a standard fee on fees accrued from staking rewards, part of which is split with validators and the rest retained by the protocol (the remainder of the split being the net total staking fees).

Community Alignment

A 100% buyback and burn program means that Magma is fully aligned with the community in a way that no other staking project has been before. When teams take protocol fees and keep them, without utilizing them to sustain the protocol economics, there is an economic misalignment between stakeholders. We’re choosing a different path: a commitment to align fully with our community, as has been our mission from day one. Following the success of Hyperliquid and the new generation of community-first protocols, we’re excited to take this leap towards sustainability and sound economics.

Disclaimer

The information in this blog post is provided strictly for general, educational, and exploratory purposes. It may contain forward-looking statements, projections, or expectations that are inherently subject to change without notice and may differ materially from actual results. Nothing herein should be construed as:

1. Financial, investment, legal, tax, or accounting advice. Always consult a qualified professional before making any decision based on this content.

2. An offer, solicitation, or recommendation to buy, sell, or hold any security, cryptocurrency, or other financial instrument.

3. A guarantee of accuracy, completeness, or timeliness. While we strive to ensure reliability, all information is provided “as-is” and may be updated, revised, or withdrawn at any time.

4. A contractual promise or agreement between the author(s) and the reader. No fiduciary or advisory relationship is created through your access to or use of this material.

5. Assurance of future performance. Past performance or historical trends are not indicative of future outcomes.

By reading this post, you acknowledge and agree that you bear full responsibility for your own research and decisions, and you release the author(s) and publisher from any and all liability arising from the use of or reliance on this information. Digital Assets may carry risks including, but not limited to: smart contract vulnerabilities, protocol changes, slashing penalties, price volatility, market liquidity constraints, and potential loss of principal. Participation in staking, governance activities, or the use of liquid staking derivatives involves financial risk and may not be suitable for all participants. Furthermore, the regulatory status of digital assets remains uncertain or evolving in many jurisdictions. It is the responsibility of each user to ensure compliance with all applicable laws and regulations in their country of residence or operation. This information is provided “as is” without warranties of any kind. Magma Staking disclaims all liability for any direct, indirect, or consequential loss arising from the use of or reliance on this content.

With Magma being one of the most popular dApps on Monad, we believe it is time to bring to you our POC - Proof of Community program.

Proudly introducing Magma ROARRR, a limited NFT series where staking testnet MON tokens isn't just staking — it’s your ticket to mainnet hype. Whether you snag a ROARRR or on of the elite SCALEs, our community gets a shot at stacking points for a future that is going to be hotter than ever.

Let’s get you the basics first:

Collection Details

• Total NFT Supply: 3,000 ROARRRs and 300 SCALES

• ROARRRs: 3,000 NFTs @ 10 testnet MON each on July 8th 2025

• SCALES (VIP): 300 NFTs @ 100 testnet MON each. TBD

• Platform: Magic Eden (Monad Testnet)

• Transferable: Yes — buy, stake, and grow your Dragon

• Mint Style: FCFS (First Come, First Served)

WL Bonuses:

Komodo Dragons: 1 free ROARRR to be minted.

Are you excited yet?

We are for sure. These NFTs are your POC - Proof of Community and will work with your MON staked to earn points for you. The more MON you stake for gMON, the more points you earn.

In order to be absolutely transparent with you, we have set up the following tiers so you understand EXACTLY how this will work.

Each ROARRR or SCALE generates base points and then your staked MON supercharges them:

Tiers

Testnet MON Staked

Tier 1 1-2 MON

Tier 2 3-10 MON

Tier 3 11-100 MON

Tier 4 101-500 MON

Tier 5 500 - 2,500 MON

Tier 6 2,500+ MON

Please note: You will be awarded points based on your Tier when each snapshot is taken.

This means that the tiers do NOT stack!

But that is not all. Duration of Staking MON will be factored into your point calculation because Proof of Community is not just about chasing points, it is about supporting each other for the long term.

Your Community Points matter so make sure you STAY active and keep earning them, both in testnet as well on mainnet.

🧮 Continuous Snapshots

To ensure your eligibility we will be taking continuous snapshots throughout the duration of testnet and mainnet. Proof of Community is here for a long time and a good time so make sure to hold on to your ROARRRs, your gMON and be a DragoNad.

So let’s do a quick sum up of the rules:

• Hold your NFT and stake MON FROM the same wallet. You have to STAKE MON yourself. Buying gMON won’t count.

• Snapshots will cross-reference your tier and NFT ownership. Once the snapshots are finalized, you can only gain rewards if you remain in your tier and hold on to your NFT.

• You HAVE to maintain your rank in Discord (Looking straight at you Gecko Guys and Komodo Dragons)

As per usual, there will be questions. The most important ones we already asked and answered for you:

• 🎯 Can I mint more than one? Nope. Mona Lizza loves to play fair, so one NFT per wallet.

• 🔁 Switch NFTs? No problem — snapshot locks rewards for the NFT you hold at the time, but make sure you hold on to your most valuable NFT because your Rarest NFT will count for the snapshot and will NOT stack.

• What will you do with the test MON gathered from the sale? All value goes to the community, so we will stake 100% of MON gathered during testnet.

• Will I only be eligible for the points program with an NFT? While we encourage you to acquire one as it will push you upwards like a spout of Magma, Proof of Community CAN potentially be achieved by being a loyal and active community member who regularly participates in the protocol.

There is only one thing left to do now DragoNads.

Get your wallets ready. Get your testnet MON stacked and get ready to Stake.

This summer, Magma ROARRRs. 🦖🔥

Introduction

Monad’s promise to solve the blockchain trilemma is an untapped opportunity to reach mass adoption within crypto. Its key practical improvements include 10,000 transactions per second on a fully L1 EVM and Ethereum RPC API compatible. The full EVM bytecode compatibility allows for the seamless onboarding of developers from the ETH ecosystem, the biggest community of crypto developers yet. The RPC compatibility permits all ETH + L2 users to adopt Monad without challenges or obstacles, such as migrating to a new wallet.

Monad brings the following 4 key improvements1:

• MonadBFT is a consensus mechanism that enhances security and efficiency through Byzantine Fault Tolerance. It ensures single-slot finality, enabling the blockchain to achieve rapid consensus and remain secure despite malicious actors or network disruptions.

• Deferred Execution: This novel approach optimizes transaction processing by decoupling execution from consensus.

• Parallel Execution: Monad uses optimistic execution to process multiple transactions simultaneously, Monad achieves 10,000 transactions per second.

• MonadDb implements a Patricia Trie data structure vs Ethereum Merkle Patricia Trie. This approach plus other improvements make MonadDb a great solution based on speed and scalability.

Given Monad’s potential to address the blockchain trilemma, it is pretty clear that MEV will be a crucial component of the Monad supply chain. Magma is partnering with the top-tier validators to develop an MEV solution that pushes the APY rewards of our Liquid Staking Token.

What is MEV?

MEV stands for Maximal Extractable Value. MEV is the additional value that can be obtained from block production beyond the typical block rewards and transaction fees. This is achieved by altering the inclusion, exclusion, or order of transactions within a block.2

MEV Controversies

MEV has always been a controversial topic due to its consequences. It can be categorized into three for network participants: good, neutral, and bad MEV3.

Bad MEV is probably the one all of us know and are afraid of. The well-known Paradigm blog post “Ethereum is a Dark Forest4 went viral after explaining the concept of frontrunning. Frontrunning can happen since arbitrage bots can look at the public mempool and run the transaction you were submitting to the blockchain before you, therefore frontrunning you and obtaining the result you were expecting with your transaction. On Ethereum, there is a new block every 12 seconds which gives more than enough time for arbitrage bots to scan the public mempool, validate, and submit your transaction to a block-builder so that it is ordered before yours.

Another type of negative MEV is sandwich attacks, which consist of placing a buy and a sell transaction in between your buy transaction, therefore, making a small profit with your transaction based on the price change. This and frontrunning are the most known types of MEV and they are negative for the health of a blockchain due to its unfairness with no positive externalities, it consists of a zero-sum game where you lose vs a specialized actor.

On the other hand, good MEV is less known and contributes to blockchain and DeFi's overall health. Examples of good MEV are liquidations and DEX arbitrage. Liquidations ensure that undercollateralized loans on DeFi platforms are properly liquidated, these liquidations are essential to prevent “bad debt” on lending protocols, which occurs when debt is not fully backed by collateral. Without this kind of MEV and incentives for anyone building an MEV bot to liquidate for a small profit, healthy DeFi would not exist. Furthermore, DEX arbitrage consists of benefiting from DEXes price discrepancies by arbitraging and leading to an equal price across all DEXes, this again contributes to the overall health of the ecosystem participants.

Lastly, you have backrunning which does not affect anybody and it is just a strategy to place a transaction after a known profitable transaction to benefit from the price change. This is known as neutral MEV.

MEV on Ethereum

Par excellence, MEV's biggest field is Ethereum. Apart from Ethereum being the largest player regarding smart contracts, it has characteristics that make MEV quite fruitful here. The fact that there is a new block every 12 seconds, allows network participants to have enough time to reorder and validate the transactions of a block before submitting it to the validators. It is the ideal time space for sophisticated actors to implement algorithms in their favor to save on gas and prevent any reverts on their transactions in a deterministic manner.

Regarding the MEV supply chain on Ethereum. In theory, MEV is earned by validators. In practice, however, there is a long MEV infrastructure in which searchers compete to have their transaction placed first by validators. In this sense, validators benefit since the only way for searchers to guarantee transaction inclusion in the block is by paying high gas fees. These searchers are getting more sophisticated, they apply different gas optimizations and algorithms in their smart contracts to reduce the gas needed for their arbitrage opportunities, this practice is known as “gas golfing”.

If we look at the history of MEV, the 2021 crisis resulted in searchers spamming the network competing to include their transactions first. These gas spikes and on-chain congestion prompted the implementation of EIP-15595 on the Ethereum mainnet on August 5, 20216, as part of the London hard fork. This EIP aimed to stabilize transaction fees and improve the user experience by introducing a base fee mechanism. This change helped mitigate the volatility in gas prices by burning a portion of the transaction fees, thus reducing the incentive for excessive bidding wars. Additionally, EIP-1559 provided a more predictable fee structure, allowing users to estimate transaction costs better and reducing the likelihood of network congestion caused by MEV activities. Thanks to this EIP, searchers still compete for gas but only on the priority fee.

In early 2022, Flashbots introduced the Proposer-Builder Separation (PBS) architecture. In PBS, block builders create block proposals by selecting and ordering transactions, often incorporating MEV bundles submitted by searchers. These block proposals are then sent to relayers, which aggregate proposals from multiple builders and choose the one with the highest fees. Block proposers, most commonly known as validators, use MEV-Boost instead of the default execution client to propose the most profitable block received from relayers to the Ethereum network. Validators can connect to multiple relayers, with MEV-Boost serving as an intermediary between the marketplace of block builders and the marketplace of validators7.

To explore further, let us examine Ethereum’s order flow landscape8.

This flow reveals significant challenges in decentralizing the block builder role, as the top five actors build 80% of the blocks. Currently, the two largest block builders are https://beaverbuild.org/ and https://www.titanbuilder.xyz/. The block builder centralization threat comes with the following risks:

• Censorship: These 5 block builders can see the transaction they are including in a block, and therefore can agree on specific block-building behavior as well as on which transactions to include or not in the block.

• Exclusive order flow: If a block builder builder can access inputs for their blocks other builders do not have9, it can create a dangerous flywheel10 where this builder becomes the main player on the market. A particular block builder might have a private deal-flow for two reasons: offering users an RPC that respects their privacy and share part of the MEV with original users. These economies of scale go against Ethereum's main principles to maintain decentralization, and that is low barriers of entry.

• Cross-domain MEV11: this can also lead to economies of scale, contributing to the centralization of the block building within the Ethereum supply chain.

To take on these centralization challenges, Flashbots is developing the new SUAVE12 (Single Unifying Auction for Value Expression) architecture to decentralize the block builder. The new architecture needs to comply with the following premises:

• Neutralize the pressure from exclusive order flow by giving users rights to participate in the MEV they create. Furthermore, all the transactions the users submit should be private and available to all block builders.

• Block builders from different chains have to integrate with each other in a permissionless manner to mitigate cross-domain MEV.

Lastly, the system that solves these two challenges, should as well be decentralized.

The SUAVE proposition looks to build a plug-and-play mempool and decentralized block builder for all blockchains.

The advantages of this approach are the following:

• Builders limited to a single domain are increasingly disadvantaged due to cross-domain MEV.

• Users gain efficiency by aggregating and clearing preferences within the same auction, enhancing SUAVE's advantage over centralized builders.

• SUAVE gains an information edge due to all the parties involved vs centralized builders' information access.

• Reaching a decentralized sequencer is a hard problem worth the cost of developing SUAVE for all chains.

• A decentralized system can provide the necessary security and credible neutrality due to the fundamental role of sequencing in the blockchain stack.

SUAVE’s solution resides in building a new specialized EVM-compatible chain that is based on three main points.

1. Universal Preference Environment. A specialized chain and mempool for users and searchers to express their preferences regarding the execution of the transactions they submit, maintaining existing properties of bundles such as pre-confirmation privacy and determinism in the form of no reverts. This can lead to specialization to meet market needs. Examples could be sponsoring gas or batching similar transactions as demanded by users and searchers.

2. Optimal Execution Market. SUAVE proposes an auction model where if there is MEV on a transaction, executors compete to capture it and give as much as possible of the MEV profits to the original user. The Execution Market acknowledges the economic significance of order flow and aims to be a decentralized platform where users, wallets, and other sources of order flow can maximize their earnings from transactions.

3. Decentralized Block Building. The decentralized block-building market optimizes MEV for both builders and validators, while also enabling the builder to operate in a decentralized manner.

To accomplish the aforementioned objectives, Flashbots will lean on SGX technology13 to achieve an SGX-based order flow auction and an SGX-based decentralized block-building network.

MEV on Solana

Solana's low transaction costs create a perfect storm for network spam coming from arbitrage and MEV activities. Although determinism is challenging due to Solana’s 400ms block times14, the low transaction cost makes it easy for MEV bots to send as many transactions as possible. In 2022, 25% of block space accounted for MEV, and in some blocks up to 50%15. This made it difficult for normal users to land transactions on the Solana network. 60% of block computing was used by arbitrage transactions, with more than 98% of arbitrage transactions failing. Solana validators wasted 58% of their time processing failed arbitrages16. Even today, Solana's failed transactions account for 40% of total transaction due to network spamming17.

Solana's architecture is unique due to its use of the Proof of History (PoH) consensus algorithm18. Validators are organized into clusters19. Within each cluster, when a validator receives a transaction, it forwards it to the current leader and the next two leaders, resulting in an absence of mempool. The leader is responsible for appending transactions to the ledger during a designated time period known as a slot. Typically, a leader includes transactions based on FIFO (First In, First Out) and priority fees20.

A leader schedule21 determines which validator will act as the leader for each slot. Nonetheless, this schedule causes a network “jitter” when validators share the shred22 (partial blocks) they are building with other nodes, this time deviation gives room for transaction reordering and MEV. Note that there is no global ordering of transactions queued for execution, there is just a local ordering in each thread’s queue. It is important to notice that Solana architecture allows for continuous block production, meaning the Solana protocol does not wait for consensus from all validators on a newly produced block before proceeding to the next one.

One can think that something like EIP-1559 could be introduced in Solana to prevent network spamming. However, the actual problem is that base fees in Solana do not depend on compute units used, the base Solana fee is fixed at 5,000 lamports per signature independently of compute units. Regarding the priority fee, it is based on compute units requested, not on real compute units used, since the used compute units are not known until a transaction is executed. Lastly, for both the base fee and priority fee, 50% is kept by the leader as an incentive to include transactions in blocks and 50% is burned23.

All these factors shape how MEV is extracted in Solana, resulting in less sophisticated MEV compared to Ethereum. There are mainly three types of MEV within Solana24. First, we can find atomic arbitrages that extract MEV when two DEXs have different prices for the same trading pair; secondly, liquidations also produce MEV on Solana. Lastly, NFT mints for popular collections represent a riskier form of MEV, since one has to sell the acquired NFTs after the mint.

The specialty within Solana is that searchers have different techniques to land their MEV transactions compared to Ethereum where Flashbots architecture dominates the chain. These strategies are the following:

1. Spam. It makes sense to searchers if the expected profit from MEV exceeds the cost of a failed transaction (0.000005 SOL). This is why 60% of block computing is used by MEV transactions, with more than 98% of arbitrage transactions failing.

2. Optimistic transactions. On Solana, searchers can send transactions optimistically. In this scenario, the searching logic lives on-chain to read the state at execution time; additionally, it exposes a searching method to be called when certain off-chain logic presumes there is an arbitrage opportunity. This reduces the need for pre-transaction state checks, decreasing trade latency. This technique is useful on Solana due to its high read speed requirements and the low cost of failed transactions.

3. Priority fees. This is the least effective method for landing transactions. A high priority fee doesn’t guarantee the inclusion of the transaction first, due to Solana mechanics, where a faster searcher could get their transaction first even with a lower priority fee.

4. High-stake validators. Shreds are first propagated from the leader to a set of validators chosen by a stake-weighted shuffle, this is why a search may decide to send their transaction through a high-stake validator or be a high-stake validator themselves.

5. Leader slots. A validator who is also a searcher, could order the blockspace they are building in their favor when being the leader.

6. JITO bundles. JITO decided to launch a forked Solana validator client in October 202225. This client auctions block space off-chain by introducing a 200ms time frame where validators accept transaction bundles while also offering revert and MEV protection26. When using the JITO client validators will earn more fees than running a Solana client, where 50% of fees are burned and not captured by validators. Furthermore, searchers compete now for block space price instead of speed. This results in more determinism for searchers, who can adjust their transactions deterministically to compete for block space auction prices, which will turn more MEV into validators as a result of the bidding competition. JITO’s proposition has resulted in their validator client gaining 90% market share27.

Application-Specific Sequencing

Application-specific sequencing offers decentralized applications control over how transactions impacting their state are sequenced. ASS allows applications to regain sovereignty over its execution and contract state. In the past, if an app wanted to be sovereign it would have to build its app chain and face some challenging UX and liquidity requirements. On the other hand, ASS offers greater composability than an app chain. It enables applications to retain the value that will flow to validators through MEV in other cases, this approach leaves the opportunity for the applications to share this value capture with their stakeholders. Lastly, it is important to note that this is the first approach that addresses MEV from an application level instead of a protocol level28.

Comparing this architecture with PBS, we can see ASS has the following properties:

• Restricted Sequencing Rights: This limitation ensures that only authorized validators can interact with the application's contract.

• App-Specific Mempools: Instead of sending transactions to a public mempool, users submit signed intents to an app-specific mempool.

• Order-Agnostic Outcomes: To uphold the sequencing rule and provide optimal economic benefits to the intended users, ASS transactions must be independent of the builders' transaction order for the rest of the block. This is accomplished by combining ASS orders into a single bundle, which is sent to builders for inclusion. Since this bundle does not conflict with the state accessed by other applications, its position within the block is irrelevant.

ASS benefits and challenges

Application-specific sequencing benefits for users and applications over validators are clear. The ability to retain MEV value capture and distribute it within the stakeholders of an application makes sense from a traditional market perspective. These users and applications want to transact without leaking any value and in the most efficient manner possible. However, it is also true that these applications are running on a blockchain that has a decentralized nature, with many more parties and infrastructure involved for these whole processes to work in a trustless manner.

Furthermore, application-specific sequencing benefits over implementing an app chain are quite clear:

1. Execution of the transactions stays in the original blockchain. ASS only delegates sequencing order, however, the execution of the transaction stays in the original L1 or L2.

2. User experience. Since the users do not need to bridge to a new chain, ASS does not come with additional UX compromises.

3. Access to liquidity. Applications can directly leverage the order flow and liquidity of the chain.

4. Assets reside in the native execution environment. Since all the assets are not bridged, there is no risk of depegs, chain halt, or security bridge hacks between others.

Application-specific sequencing challenges that need to be addressed:

1. Censorship. If we look at the perp and spot DEX Vertex, we can see that they run ASS through an off-chain sequencer to minimize MEV. This is a great approach, however, since the sequencer controls which transactions are included, this central entity could decide to censor specific users or transactions29.

2. Permissioned transaction validation. As we stated before only authorized validators can include transactions, this goes against the permissionless principles of any blockchain.

3. Liveness assumption. In the event of a liveness breach, such as a network partition, users may be unable to interact with parts of the application until a valid consensus is restored.

4. Trust assumption. As we stated, whether ASS introduces one or more sequencers, there is an inevitable trust in external sequencers that could be broken if one of them decides to act maliciously.

5. The composability dilemma. Applications that require high composability with other applications may sacrifice some control over transaction sequencing, making them more susceptible to MEV. On the other hand, applications that limit interactions with others gain more control over transaction ordering, allowing them to better protect against MEV exploitation and capture more value. However, this can reduce interoperability and potentially affect user experience30. Depending on the application’s composability needs ASS can be a great product or not.

6. Validators misalignment. ASS will probably be adopted sequentially by different applications, this will probably cause inefficiencies in the validators ecosystem. Validators are going to find themselves in a weird position to compete in the market, either they follow the status quo and continue with PBS being more competitive, or they adopt ASS at the cost of losing some revenue at least in the short term. It is important to take into account that MEV will always exist as some applications may choose not to do ASS for different reasons.

7. ASS bundle reversion. A single invalid non-ASS transaction, when composed with an app-specific one, can have the second-order effect of reverting the entire bundle.

8. Frontrun and backrun opportunities. Theoretically, searches could compete to place an order before or after a specific ASS bundle.

9. Resources overhead. Many applications might find that ASS represents a big effort for low results, following Pareto’s law, applications which do not rely on ASS as their main selling point might skip implementing ASS due to the resources needed to implement these solutions. For example, Fastlane’s flagship product Atlas requires modifying the frontend and backend, integrating with an operations relay, and developing a custom DAppControl module31.

It is important to remember that there are different players in the market like Sorella Labs, FastLane, Vertex Protocol, and Semantic Layer which are trying to solve the aforementioned challenges in different ways. ASS is still a nascent technology with a promising future and only time can tell if ASS will pass these challenges and get widely adopted.

MEV on Monad

Monad’s continuous block production presents challenges for MEV participants due to its deferred execution, which introduces indeterminism. Consensus happens first, where the order of transactions is settled between nodes, then, on the next block these transactions are executed in the consensualized order.

In the default Monad client, leaders use a priority gas auction to determine the transaction sequence. The Monad protocol does not enforce a specific transaction order as valid, and gas costs per opcode are identical to those in Ethereum32. It is important to note that indeterminism refers to execution, since absolute determinism exists regarding the order in which transactions will be executed, in other words, there is state determinism: “execution is required to unveil the truth, but the truth is already determined”33. Hence, validators agree on the order of these transactions through consensus, even though these transactions will execute on the next block.

Looking at Ethereum and Solana, we can conclude that searchers are looking for revert protection, hence, thereby avoiding the need to spam the network to secure inclusion. On this matter, it is not clear if simulating a transaction is going to be possible due to the parallel and deferred execution, even if possible, only part of the block transactions can be validated within a second due to Monad’s block speed. At Magma, we are researching a method in which a partial bundle of transactions can be auctioned off-chain offering guaranteed revert protection. This approach draws inspiration from Jito’s architecture, where due to network speed constraints, Jito's client does some partial block-building auctions where they offer revert protection.

Lastly, another area of research to align searchers and validators involves developing a fast and efficient method for searchers to land their transactions, offering MEV protection and multiple transactions being processed sequentially and atomically. This is an important area of research for Magma in conjunction with revert protection. This playbook has been successful in the past, addressing the needs of searchers and validators. Monad’s new architecture raises some questions, but a client offering these features could be a highly sought- after product in the ecosystem. Additionally, our objective is to reduce intermediaries and steps in the whole MEV architecture, enabling searchers to land their transactions faster while minimizing MEV capture by intermediaries.

Our MEV North Star

A north star is an ideal goal towards which we strive. For example, Solana’s North Star is for the blockchain to propagate transactions in real-time from one side of the world to the other, without latency. Having a clear north star helps ensure alignment in our direction. Achieving this goal is a step-by-step process, always evolving and subject to continuous improvement.

Our MEV north star is to reduce the number of intermediaries in the MEV process and get as close as possible to having direct communication between searchers and validators. As we have shown above, typical MEV flows can consist of 2-3 intermediary steps between a searcher submitting a transaction and a transaction being included in a block. Reducing the number of steps has practical benefits: with one-second block times, each additional intermediary step in the MEV process increases network latency.

It is important to remember that while reaching our north star, we have to make sure that every network participant is aligned. This is why we are researching three different areas to provide an equitable MEV architecture for the whole ecosystem with the least intermediaries and with users at its forefront.

After analyzing the Proposer-Builder Separation (PBS) model, we concluded that some components need to be removed if we want to follow a similar path on Monad. This makes sense given the similarities between Monad and Ethereum. Monad is starting with a priority gas auction model, which could result in a similar architecture to PBS if MEV evolves within Monad. Reviewing the different components of PBS, we are researching the possibility of extracting the relayer from the architecture to make it more optimal. This would allow for at least some partial block building where searchers submit their MEV bundles.

Looking at the typical PBS MEV flow, it is clear that the first step would be to remove relayers, creating a marketplace from block builders to validators.

There are significant performance benefits achieved by removing the relayer. Monad is designed for continuous block production and high throughput; the extraction of the relayer could streamline the MEV process significantly. This improvement could extend the operational time window under which searchers need to operate to submit their MEV bundles, hence, less sophisticated searchers would be allowed to operate on Monad favoring MEV infrastructure decentralization.

In this model, the way that builders communicate with validators about the sequence of transactions that should be included in the consensus block is crucial. This adds increased complexity in managing transaction prioritization and block construction without a centralized relayer. Additionally, some constraints have to be met such as avoidance of centralization by block builders, and lack of incentives for transaction reordering either by builders or validators. Another interesting concern is to avoid increasing the workload of the validators' nodes, given the current strain they will experience with one-second block times. This upgrade requires careful consideration of the technical and operational challenges to ensure that the validators remain robust, secure, and capable of handling high transaction volumes.

From another perspective, Trusted Execution Environments (TEEs) have immense potential, and we are researching their application at the client level. More concretely, Intel SGX is a specific implementation of a TEE, designed to provide a secure area within a processor for executing sensitive computations. SGX achieves this by creating secure enclaves, which are protected regions of memory that ensure the confidentiality and integrity of the data and code they contain. These enclaves allow for secure execution by isolating the processing of sensitive data from the main operating system and other applications. This isolation ensures that even if the rest of the system is compromised, the data within the enclave remains secure.

By running a client within an SGX enclave, transaction details can be kept confidential, even from the node operator. This setup ensures that transaction data is not exposed to unauthorized parties, providing a high level of privacy and security. The concept of a private mempool using SGX is particularly appealing. Through this approach architectures such as PBS would be reduced to users, searchers, and validators, removing all the intermediaries while giving privacy and MEV protection to users.

The benefits of using SGX for a private mempool are significant, particularly in terms of enhanced privacy and trust minimization. By ensuring that transaction details remain private, SGX protects them from potential leaks or unauthorized access, which is crucial in reducing the risk of front-running. Furthermore, TEEs and SGX open the MEV space to more participants who can become validators; it is important to remember that TEEs can provide integrity and privacy even in the presence of a malicious operator. Regarding the challenges, performance is one of our main areas of research, if we take a look at Flashbot’s experimentation with SGX34 we can see that running an SGX client is demanding from a time and resource perspective.

Another area of active research is Fully Homomorphic Encryption (FHE) and its applications within the MEV space. FHE is a form of encryption that allows computations to be performed on encrypted data without needing to decrypt it first. This means that you can perform operations on the data while it remains secure and private, and the results of these operations, when decrypted, will match the results of operations performed on the plaintext data.

These bring numerous benefits, especially when you think that users could submit encrypted transactions to searchers that would be private. The searchers could take advantage and blindly backrun these encrypted transactions without affecting the initial users. Furthermore, this approach would bring us to our north star of having only users, searchers, and validators. Additionally, it is important to note that FHE is more efficient than secret-sharing-based MPC protocols. However, several challenges remain. First, if we look at the high hardware requirements of past experiments with FHE35, we can see that centralization might be a problem due to computation needs, which could limit the number of searchers. Secondly, it is not clear yet how we might limit what blind operations the searcher can backrun on the user. Lastly, within FHE, there are still many optimizations to be done regarding arithmetic operations and its different cryptographic operations.

Conclusion

In conclusion, we aim to leverage the latest technologies to create an MEV architecture where searchers can send their transactions directly to validators. In our journey toward this goal, we strive to reduce intermediaries and associated latency in the MEV flow. This approach offers several benefits: it provides searchers with more time to submit their transactions, thereby opening up the MEV space to less sophisticated players for whom speed is not the most critical factor. Additionally, it enhances privacy and reduces the risk of censorship by eliminating intermediaries, thus establishing a direct marketplace between searchers and validators. Lastly, our pillars of MEV design prioritizes users by focusing on privacy, protection from bad MEV, and minimizing latency.

Today, the Magma team proudly launches its public testnet on Monad! 🎉

After 20+ months of dedication and anticipation of Monad’s testnet infrastructure, we’ve reached a major milestone in redefining decentralized finance. We're excited to welcome our community to this pivotal phase as we rigorously test Magma’s full functionality ahead of mainnet.

Get Started Here 👇

https://www.magmastaking.xyz

What is Magma?

To refresh your mind, Magma was the first native project to build out our liquid staking platform on Monad. Magma is designed to unlock liquidity and the full potential of $MON throughout the Monad DeFi ecosystem.

Here’s how it works:

• Stake your $MON to earn $gMON, a liquid staking token that retains value and will eventually accrue staking rewards once mainnet is launched.

• Use your $gMON across Monad’s growing DeFi ecosystem, from lending and borrowing, to swaps, liquidity provisioning, and more.

Magma is built to empower users with liquidity, yield, and opportunities—all while reinforcing the core principles of Monad, a high-performance EVM-compatible Layer 1 blockchain.

Why Join Magma’s Testnet?

• Participate in liquid staking with testnet $MON.

• Receive $gMON after staking

• Provide feedback to help shape the protocol before mainnet goes live.

Now as a reminder, Monad is rolling out testnet in phases and staking is not yet live, as such, we cannot provide yield at this time. But no worries, we will let you know the second that becomes active.

This is just one more chance to show the Monad ecosystem you are a true DragoNad.

And DragoNads ARE Nads.

How to Get Started

Here’s how you can start testing Magma today:

Step 1: Set Up Your Wallet

• If you don’t have a wallet, create one with MetaMask or Phantom

• Follow this setup guide if you need help.

Step 2: Connect to Monad Testnet

1. Open the Magma Testnet portal: https://www.magmastaking.xyz

2. Click “CONNECT WALLET” and select MetaMask.

3. If prompted with "WRONG NETWORK," select "Switch to Monad Testnet" in the dropdown menu.

Step 3: Get Testnet $MON Tokens

1. Head to https://testnet.monad.xyz/

2. Enter your EVM wallet address and click “Get Testnet MON”

Step 4: Stake Your Testnet $MON

To stake, first go to the stake dashboard and select the amount of $MON you want to stake. To see how many you have, check your wallet or check the dashboard. It will show you the total amount of $MON currently in your wallet that is available for staking.

After clicking stake, wait until the process wheel stops spinning and you receive a confirmation on your screen informing you that your stake was successful and $gMON was deposited in your wallet.

Click “here” to add $gMON to your wallet so it is visible upon opening your wallet right away.

Congratulations DragoNad, you have successfully supercharged Monad and received the Magma LST $gMON.

Step 4: Unstake Your Testnet $MON

Now let’s continue our testing by unstaking your $gMON.

On the dashboard, select “Unstake”. You will be able to see the amount of $gMON available for unstaking in your wallet or on the Dashboard itself. Type the total amount of $gMON you would like to unstake and click “Unstake”.

After clicking unstake, wait until the process wheel stops spinning and you receive a confirmation on your screen informing you that your unstake was successful. Your $MON and its yield is back in your wallet, ready to be staked again.

What’s Next? Using $gMON

Once you have your $gMON, explore its potential by:

• Engaging with DeFi protocols across Monad by putting your $gMON to work

• Watching it accrue staking yield over time once activated

• Show it off to all Nads as being part of the first Monad project

Why Your Feedback Matters

This is a defining moment for Magma and Monad. Your experience and input will help us refine the platform for a seamless mainnet launch. Share your thoughts, report issues, and let us know how we can improve.

Join the DragoNads:

• Discord: https://discord.gg/magmastaking

• Twitter (X): @MagmaStaking

The Future is HOT like Magma

Magma Testnet is more than just a milestone—it’s the community’s first step towards making Monad succeed. Let’s build this future together. 🌟

🚀 Start testing NOW:https://www.magmastaking.xyz

Magma Partners with Obol to Bring Distributed Validators to Monad

The moment is here, DragoNads! We’re thrilled to unveil our partnership with the Obol Collective —a game-changing collaboration that sets the stage for deploying Distributed Validators (DVs) on the Monad blockchain. This step not only makes Monad the third Layer 1 blockchain to implement DVs after Ethereum and Gnosis, but also ignites our mission to revolutionize staking with next-level decentralization.

Why DVs Matters for Magma

When we envisioned Magma, securing a bulletproof staking experience was the foundation of our roadmap. We didn’t just aim for more staking rewards—we aimed to create staking that stands unshaken, no matter what.

That’s why DVs have always been part of our destiny: multiple operators running a single validator together for unmatched reliability. Obol’s expertise complements our goal of minimizing slashing risks while empowering our community to stake with confidence.

A Partnership That Embodies Web3 Innovation

This collaboration is more than a handshake—it’s a huge step toward our shared goal of decentralized resilience and accessibility for everyone. Here’s what’s in store:

• Operator Squad Power: Squad Staking lets multiple operators run a single validator together, enhancing both security and inclusivity.

• Boosted Network Reliability: Obol’s innovative DV middleware ensures validators are robust and capable of withstanding node failure as Obol makes all their validators fault tolerant and slashing resistant.

• A Broader Staking Ecosystem: Monad’s decentralized ecosystem will be enriched by new operators from the Obol community, expanding participation like never before.

“Integrating Obol’s DV staking stack with Monad’s cutting-edge protocol is the perfect match. Together, we’re building a validator experience that’s scalable, resilient, and aligned with the heartbeat of the Web3 ethos,” says David Mass, Co-Founder & CEO of Magma.

Strengthening the Decentralized Operator Ecosystem

This collaboration represents a significant milestone for the Obol Collective as it expands into securing Monad, providing new opportunities for their operators to earn staking rewards. It also showcases the versatility of the Obol Product Suiteacross multiple Layer 1 networks.

“This partnership with Magma is further validation of Obol’s impact as an ecosystem that empowers operators and enhances the decentralization of networks like Monad,” says Collin Myers, Co-Founder & CEO of DV Labs. “The foresight shown by Magma to prioritize Distributed Validators from the outset demonstrates their commitment to building a resilient protocol that stands the test of time.”

The Road Ahead

Magma and Obol will collaborate on researching, developing, testing, and ultimately deploying DVs on Monad. Along the way, there will be opportunities for the DragoNads of Magma and operators in the Obol ecosystem to join this epic journey.

Stay tuned for updates as we move forward in shaping the next chapter of Web3 architecture.

Please welcome the Obol Collective with a resounding ROARRR that echoes through the ages, DragoNads!

Make sure you stay in touch with us on X (Twitter) or hang out with us on Discord to follow our meme-fueled eruption into a promising, more vibrant and inclusive DeFi landscape.

Blockchain technology, underpinning cryptocurrencies, ensures transparency and traceability, crucial for supply chain management, healthcare, and real estate. Decentralized finance (DeFi) platforms democratize access to financial services like lending and borrowing, breaking barriers imposed by conventional banking systems.

Emerging markets have been leveraging cryptocurrencies to combat hyperinflation and currency instability. E.g. El Salvador's adoption of Bitcoin as legal tender exemplifies this trend, promoting financial stability and innovation.

As the crypto ecosystem expands, regulatory frameworks evolve, aiming to balance innovation with consumer protection. Governments and institutions increasingly recognize the potential of cryptocurrencies, integrating them into mainstream financial systems.

You heard it here first, crypto is reshaping the financial landscape of the world in real time. Tokenized real world assets are picking up and with Bitcoin transitioning into traditional markets, we are closer to getting full circle.

Expanding Applications and Innovations

Cryptocurrencies are also revolutionizing digital identity verification. Blockchain-based IDs offer secure and tamper-proof solutions, enhancing privacy and reducing fraud. In the gig economy, freelancers receive payments in cryptocurrencies, bypassing international transfer fees and delays. Educational institutions are issuing blockchain-based diplomas, ensuring authenticity and simplifying verification processes.

Non-fungible tokens (NFTs) have opened new avenues in art, music, and gaming, allowing creators to monetize their work directly. Virtual real estate in metaverse platforms is bought and sold using cryptocurrencies, creating new digital economies.

Environmental sustainability is gaining attention, with projects like Ethereum 2.0 and various carbon offset initiatives aiming to reduce the carbon footprint of crypto operations. Moreover, innovations like smart contracts are streamlining legal agreements, reducing the need for intermediaries, and increasing efficiency.

Cryptocurrencies also play a crucial role in humanitarian aid, providing a transparent and efficient way to distribute funds directly to those in need, bypassing bureaucratic hurdles.

Monad is adding to all of this by bringing a network that surpasses the fastest current blockchain network by almost a factor of 10. This is important because in our daily lives, we are not used to waiting for anything and thus, fast transactions are the singular most important factor on par with security.

TL;DR

Cryptocurrencies are changing the world, from international remittances and digital identity verification to decentralized financial markets. As adoption grows, they promise a more inclusive and efficient financial future.

Let’s make sure you stay in touch with us on X (Twitter) or hang out with us on Discord to follow our magma-fueled eruption into a promising, more vibrant and inclusive DeFi landscape.

Web3 in general reacts very well to this phenomenon but… why are memes so interesting?

Take a dive with us into meme culture!

What in the World Wide Web is a Meme?

What exactly is a meme? Contrary to popular belief, we're not talking about your grandma's knitting patterns (though those can be quite meme-worthy too). In the digital realm, memes are quirky, contagious, funny images, videos or texts and they're everywhere!

At their core, memes are snapshots of cultural relevance– images, videos, or even just text – that spread like wildfire across the internet, evolving with each iteration. From the iconic "Distracted Boyfriend" to the timeless "Woman Yelling at Cat," memes have taken lives of their own, rising above language barriers and uniting the globe in laughter, confusion, and sometimes even sadness.

The Rise of Memeology

The roots of meme culture run are a lot older than you might think. We need to do a TBT all the way to King Tut. We are talking about a journey from ancient hieroglyphs of Egypt to the dank depths of 4chan where people have been regaling each other with fun pictures.

It wasn't until social media however, that memes truly took off and became global expressions of emotions. Reddit, Twitter, IG and others became the breeding grounds for dank meme masters, providing a virtual playground to remix, remaster, and re-imagine pop culture into memes we now all use.

Scholars and armchair philosophers have been investigating the mysteries of meme culture, from the intricate dynamics of virality to the profound impact of Pepe the Frog on modern politics (I wish this was a joke but Pepe is a powerful froggy).

The Great Meme Wars

No discussion of meme culture would be complete without mentioning the Great Meme Wars – epic battles fought on the front lines of Twitter feuds and subreddit skirmishes. From the legendary clash of "Team Edward vs. Team Jacob" to the “Kdot vs Drizzy beef” these digital showdowns have captured the timelines of social media users around the globe, spawning countless think pieces and think tanks dedicated to deciphering their hidden meanings or just straight up blasting the competition.

Memes have become the universal language of the internet, transcending borders, ideologies, and time. They serve as the great equalizer – reminding us all that, deep down, we're all just a bunch of goofballs scrolling through our feeds in search of the next big laugh.

Why is Web3 so Meme-y

Web3 natives currently consist of a specific group of internet denizens. We spend our time here trying to figure out the next best play, we understand the intricacies and importance of crypto currency and communicate with each other mostly through social media.

Because Memes are a digital translation of humanity, it is not a stretch to determine that Web3 denizens are fluent in memes. We are literally born here and are therefore able to break down very complex blockchain concepts into understandable language, making Web3 more accessible for non-technical users. You heard it here first: Memes are the portal to mass-adoption!

Another thing to consider is generational impact. Most Web3 founders are of the generation that was introduced to the internet at a young age. One could say that we are the first generation on the internet and thus memes are the expression of our age group, which is now being picked up by the next generations that are entering the space.

Here at MagmaDAO we celebrate our meme kings and queens. So we decided to start excursions into Mona’s cave to uncover the true Meme masters and mistresses. As a part of the Monad Ecosystem it is more then important then ever to show how fluent we are in Meme.

Make sure you stay in touch with us on X (Twitter) or hang out with us on Discord to follow our meme-fueled eruption into a promising, more vibrant and inclusive DeFi landscape.

We obviously love the topic and so do you, otherwise you would not be here. Feel free to stick around, because we are going to tell you about the magic behind Liquid Staking Tokens.

Liquid Staking Tokens… What are they exactly?

A Liquid Staking Token can be compared with an IOU that you used to give your classmates back in the day.

When a user brings their Monad Tokens to MagmaDAO, we take it, we stake it and we give them an IOU, our Liquid Staking Token. With that IOU they can come back and reclaim their Monad Tokens at any given time. What is even better, they can get it back with an extra side of Monad tokens as a result of their staking.

But that is not all they can do. Everywhere within the Monad ecosystem, a user can exchange that IOU for services or tokens for the value of that IOU in the market. Or, they can purchase IOU’s from other users who staked their Monad Tokens with us and return it, benefitting from the yield that is given on that IOU.

Why not just use Monad’s Token?

Honestly, we could. However, we considered the following points in detail.

Monad is fully decentralized and a proof-of-stake network. The network is maintained by a decentralized set of validators. Everyone can run a node, as long as they meet the requirements.

This is where we come in.

To incentivize a staking node, there is a yield reward of Monad tokens for stakers. The traditional way of staking however, locks up liquidity, making it less attractive for a large group of people who would like to keep some form of flexibility.

Liquid StakingTokens like ours, are a direct solution to this. Users on Monad can stake all their Monad tokens, directly contributing to the stability and decentralization of Monad as a whole, but because their tokens are liquid, they can enjoy the same freedom they would have without staking them.

On top of that, stakersare able to enjoy the same yield from staking that they would receive with traditional staking and compound it when they utilize their LST with any other form of DeFi yield farming, lending and trading that is available to them within the broader ecosystem.

Who can use the MagmaDAO LST? 

We are not elitists. True to the nature of crypto, our staking protocol is available to whomever wants to make use of it.

Personally, we think it should be everyone considering the huge benefits we just pointed out, but you are free to decide for yourselves that we are the ultimate LST solution.

In order to make sure, however, that we bring full value, our BD department led by Mona is working like crazy to align collaborations with all projects and developers building on Monad. Together, we will reshape the way that Web3 is viewed by the space itself AND by everyone outside of it.

TL;DR

Liquid Staking Tokens are what makes an ecosystem fluid and able to service multiple user groups with multiple angles.

Let’s make sure you stay in touch with us on X (Twitter) or hang out with us on Discord to follow our magma-fueled eruption into a promising, more vibrant and inclusive DeFi landscape.

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Liquid staking could supercharge the efficiency and flexibility of blockchain ecosystems. It’s a technological development that has had a rather large impact in both CeFi and DeFi.

Protocols like Lido and Jito have been welcomed with open arms by their respective communities. Having seen the positive effect on the ETH and SOL ecosystems, MagmaDAO is ready to step up and build a community focused Liquid Staking protocol for Monad's burgeoning ecosystem.

At its core, liquid staking allows users to earn staking rewards without locking up their assets. Literally like having your cake and eating it too - yum!

With traditional staking you have to lock your assets up whilst you are farming rewards. During that time, you cannot access them and many staking protocols have lock/unlock periods, making it a slow process to unstake assets and sell at your discretion.

Liquid staking protocols issue you a token representing your staked assets, enabling you to use your assets. This means you are able to sell without going through the process of unstaking but it also means you are able to acquire staked rewards through other DeFi applications by purchasing these liquid staking tokens that represent a portion of staked assets. While traditional staking methods involve bonding and unbonding periods that can last from days to weeks, liquid staking offers stakers greater liquidity and capital efficiency.

Simple right?

Yea, Dan, our CMO didn’t understand it when our founder explained it to him either. So to make it a bit simpler, we added an infographic.

There, now you got it.

Lido and Jito: Paving the Way

MagmaDAO has been looking at market leaders Lido and Jito who have been instrumental in popularizing liquid staking.

Lido allows users to stake their Ethereum and receive stETH in return, representing their staked ETH plus rewards. By doing this, they opened up the Ethereum blockchain to even more users, some of which might have been on the fence to stake. As such, Ethereum became more attractive for low value stakers and simultaneously more decentralized.

Jito, on the other hand, has focused on scalability and efficiency, enhancing the user experience for Solana users.

Oh and they released a juicy airdrop that gave people the Jitos

Sorry guys Dan really loves dad jokes.

CeFi Alternatives

Because of challenges in accessing DeFi, large exchanges such as Kraken, Coinbase and Binance have provided a form of liquid staking to their users.

This is important because if you’d like to run an ETH staking node solo, you would need to stake 32 ETH and have a computer with at least a CPU with 4+ cores, 16GB RAM, 1TB storage space on an SSD drive (for starters) and internet that reaches the speed of light.

As they pool their users’ assets and stake it on their behalf, they successfully tackle the requirement for minimum capital and release the users from the operational burden.

As CeFi institutions issue a liquid market for staked assets, they are effectively unlocking liquidity and allowing users to swap back from staked ETH to ETH. These services are valuable for their users, creating a big opportunity for a decentralized alternative.

MagmaDAO is looking to fulfill a similar service for Monad, but decentralized.

Our Solution

By building liquid staking for Monad, MagmaDAO is taking a formidable leap adapting large scale liquid staking models with a community focus to fit the unique needs of the Monad ecosystem. Our goal? MagmaDAO aims to offer enhanced liquidity, greater flexibility, and increased participation in governance for the Monad ecosystem. With this, we envision to bring the following benefits to the Monad ecosystem

Increased Liquidity: Users aren't forced to choose between staking and other DeFi activities. This fluidity encourages more participation and investment, boosting TVL on Monad and making it attractive for even more investors, creating a positive loop

Enhanced Security: More staking means a more robust and secure network.

Governance Participation: Liquid staking tokens often come with voting rights, fostering a more democratic ecosystem which will enhance decentralization for Monad.

MagmaDAO will establish balance honing in on the competitive nature of hunting for incentives between staking and seeking yield in DeFi. By issuing a Monad-native liquid token, MagmaDAO will allow users to stake native Monad tokens as collateral within DeFi in the same way users leverage ETH or SOL holdings.

MagmaDAO is not just implementing liquid staking, our big brain devs are looking for ways to innovate. They are working on unique features like enhanced governance models and risk mitigation strategies to ensure the safety and efficiency of staking in Monad’s ecosystem.

TL;DR

The liquid staking protocol built by MagmaDAO signifies a momentous step for Monad's ecosystem. It’s not just about staking; it's about opening new avenues of participation, security, and liquidity with an unwavering commitment to decentralization

Stay in touch with us on X (Twitter) or hang out with us on Discord to follow our eruption into a promising, more vibrant and inclusive DeFi landscape.

Just like volcanoes were there at the beginning of time, Magma was built to grow at the birth of Monad.

As a DAO-owned Liquid Staking Protocol designed for equitable token distribution via a competitive points system and the first Distributed Validator Technology (DVT) outside of Ethereum, Magma is setting the bar high. 

That was a mouth full. Let us explain a bit more in this intro article where we will dive into what we are building.

First things first…

Why Monad?

Monad is an EVM L1 chain that is the fastest, cheapest, and most censorship resistant.

Built with performance in mind, Monad blows other blockchains out of the water supporting 10,000 transactions per second. This significantly increases throughput capacity, opening the door for even more high-volume and complex applications that are looking to run in a decentralized manner.

Their vision was picked up by investors in the current builders market, resulting in an amazing $19M raise led by Dragonfly Capital. 

Hello, is it DAO I am looking for?

Magma has deliberately chosen a DAO structure. 

We believe the DAO format presents a perfect midway between total centralization and decentralization, as it allows for the development of competitive products that are needed by users without the need for full centralization and custody on an exchange, and all that comes with it.

So why is this ideal for us?

First of all, we are building for the community and the best way to do that in our experience is to build WITH the community. A DAO fosters a more socially conscious decision making process, ensuring that we are building what you need.

A DAO’s tokenomic structure makes it possible to fund protocol development and upgrades using the DAO’s token treasury, meaning that every development is paid for AND supported by the community.

The DAO also provides for several management activities by leaning on the capabilities of it’s members. This adds on to the capabilities of the team, making 1+1 =  3 a reality.

On top of that, the DAO will collect Magma’s fees, channeling them into the treasury where it can be utilized for insurance and further development based upon decisions made by the DAO. A perfect circle.

Liquid Staking FTW

All of Web3 has been in the band of the Ethereum merge, dubbed by some as an apocalyptic event that would end all of crypto. In the wake of that merge, Lido DAO provided a solution by introducing Liquid Staking. This basically means that one can stake ETH, get a stETH token in exchange, which in turn can be used to trade that staked share.

This has resulted in an increase in stakers, now broken free from old restraints, to the Ethereum ecosystem and has brought many larger players into the fold. 

Magma will allow Monad’s token holders to receive staking rewards, whilst remaining liquid by providing all users that stake in Monads DPOS consensus with liquid staked tokens as a representation of their stakes. In turn, these can then be traded, as if the staked tokens were liquid.

DVT for the Masses

Distributed Validator Technology, or DVT, is a way to increase decentralization in a decentralized network. It was pioneered on the Ethereum blockchain and has offered a wide range of benefits to users and stakers such as: Lowering the threshold to run a validator node, increasing decentralization, and thus, the effect of potential bad actors as it reduces the risks of slashing due to liveness faults or other criteria.

Sounds great, but what does it mean?

Think of it as a group of people processing your request for a driver's license at the DMV instead of one person (No offense Gary, we love you).

Through the application of DVT, validation runs through a sort of mini network that each contains a piece of the private key needed to sign the validation on a transaction. This way, even when a portion of the computers are not online due to any given reason, a transaction can still be processed if the majority of the mini network is in consensus.

DVT is important for Magma since a reduced risk of slashing makes staking safer and thus, increases the safety of our liquid staking protocol. 

The other reason DVT is so important is because the increased decentralization ensures less power for individual operators to influence the protocol.

This decentralization does not only remain with Magma, but the full Monad ecosystem that can benefit from it, making Monad even more decentralized.

Keep an Eye on that Drip

The final feature that we will be announcing today is Magma Points, a points-program that is engineered to significantly boost and support community participation for both Magma and the Monad ecosystem as a whole.

Forget everything you learned on X about community programs, we are rewriting the handbook.

We will launch the Magma Points program which will pull the ecosystem into a competition of the ages for which all projects building on Monad are automatically eligible. More details to come on that.

For 5 years, Magma will incentivize building on Monad.

Magma Points will result in Magma being engaged by Monad’s best and brightest projects, giving the entire ecosystem a good vision of the DAO.

And for a little bit more on that DAO; None of the locked tokens from any of the team members, advisors and early supporters will count towards governance, giving them less and less influence over the protocol. As time goes on, Magma’s team will hold a continuously decreasing share of protocol governance as the token distribution widens across all of Monad, like magma dripping gushing out of a volcano.

How is that for decentralization?

We are happy to welcome you all into the warmth of Magma and hope you will be a part of our continuous contribution to Monad and to the Web3 space in general.

Follow us on Twitter and take part in the discussion or check out our new Discord to participate in the discussion.