Barely four months after generating its highest-ever monthly revenue, liquid staking platform Sanctum has introduced Infinity V2, a significant upgrade to its Infinity protocol that aims to improve how users earn yield and how liquidity flows across the Solana liquid staking ecosystem. The update builds on Infinity’s role as a foundational liquidity layer for liquid staking tokens, or LSTs, and introduces new mechanisms designed to deliver more consistent returns and more efficient liquidity provisioning.
Since early 2024, Infinity has supported the rapid expansion of liquid staking on Solana. The protocol has enabled more than 1,300 LSTs to launch and has also supported major platforms such as Jupiter, Bybit, and MoonPay in launching and scaling LST products. During periods of market volatility, Infinity has functioned as a stabilizing asset, helping manage LST depegs while continuing to deliver competitive yields to $INF holders
Continuous and Stabilized Yield Distribution
Infinity V2 introduces a new model for how yield accrues and appears across the Solana liquid staking ecosystem. Traditionally, staking rewards on Solana are updated only at the end of each epoch, which lasts about two days. This structure results in periodic jumps in yield rather than a steady accrual and can distort how performance appears on DeFi platforms that report median APY instead of true averages.
The upgrade changes this dynamic by distributing yield continuously at every slot, the smallest unit of time on Solana. As a result, rewards accrue in real time, allowing INF holders to earn yield every second rather than waiting for epoch boundary updates.
Infinity V2 also introduces yield smoothing to reduce volatility in reported returns. Captured trading fees now distribute across multiple epochs instead of concentrating within a single distribution window. During past periods of intense market activity, the platform experienced a spike in APY. For example, Infinity reportedly recorded a 26% epoch return due to elevated trading fees as a result of the October 10 market crash. The new system aims to spread excess returns from such periods across a longer timeframe, creating a more stable yield profile.
Together, continuous slot level distribution, fee smoothing, and portfolio optimization aim to produce more consistent performance, bring median and average APY closer together, and reduce volatility in how yields appear across DeFi platforms.
Improved Liquidity for LST Partners
Infinity V2 also focuses on strengthening liquidity for its partner ecosystem. The protocol replaces its static fee model with a dynamic fee structure that adapts to market conditions. This change aims to improve capital efficiency while ensuring that liquidity remains available across supported LSTs.
Under the new structure, partner LSTs benefit from lower swap fees of approximately 10 basis points, while non partner LSTs face fees roughly five times higher. This design gives partner assets priority access to the liquidity held within Infinity, resulting in deeper liquidity and more favorable pricing for those tokens.
As a result, LST issuers that rely on Infinity can expect more predictable liquidity flows and improved trading conditions. These changes reinforce Infinity’s role as a central liquidity hub within the Solana staking ecosystem.
Sanctum Hits ATH of $16.28m $SOL Staked
The upgrade arrives at a time when Solana DeFi activity is reaching new highs, with total value locked denominated in $SOL climbing to all-time highs across the ecosystem. Within this broader trend, Sanctum has also recorded a new all-time high of 16.28m $SOL in TVL, reflecting growing demand for liquid staking infrastructure and aggregation layers like Infinity.
As a result of this growth, Sanctum now ranks as the third-largest protocol on Solana by total value locked. This position highlights the protocol’s expanding role as a core liquidity layer for LSTs.
Regulatory developments have also contributed to the sector’s momentum. Back in August, the SEC clarified that liquid staking activities do not constitute securities offerings, providing a clearer framework for innovation and institutional participation.
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