LPoS (Leased Proof of Stake)

Leased Proof of Stake (LPoS) is a version of Proof of Stake (PoS) consensus mechanism. It allows the users to lease their assets to full node operators, who are responsible for maintaining the blockchain network and creating new blocks. In return, the node operators share a portion of the block rewards with the users who leased their assets (asset holders).

LPoS is an enhancement to the traditional PoS mechanism and aims to provide a more efficient and flexible staking process. In LPoS, asset holders can lease the staking rights for their assets to other participants (node operators), who then use these rights to validate transactions and earn rewards. In return, the node operators share a portion of the block rewards with the users who leased their assets (asset holders).

As of now, LPoS is used mainly on the Wave blockchain which does not regulate the payment for the lease in any way, meaning that users can also agree on the price without any other restrictions.

In the following picture, you can see how the LPoS works in this blockchain.


What's the difference between Leased Proof of Stake and Proof of Stake?

In Proof of Stake (PoS) consensus, validators are selected to validate blocks based on the amount of assets they stake. Asset holders can either stake their own assets or delegate (stake) them to a validator. Delegating assets is a popular option for asset holders who do not have the technical expertise or resources to run their own validator node.

LPoS allows asset holders to lease their staking power to validators (node operators). This means that asset holders can transfer the right to stake their assets to a validator without transferring the assets themselves. This makes LPoS more secure than traditional PoS, as asset holders can retain ownership of their assets in their wallets while still participating in staking.

Leasing staking power in LPoS is very flexible. Asset holders can lease their assets for any period of time, and they can cancel the lease at any time without penalty. The assets remain locked in the asset holder’s wallet until the leasing agreement is canceled. This provides users with greater control over their assets and promotes a more dynamic ecosystem compared with the PoS unlocking period.


  • More efficient staking process - LPoS allows asset holders to lease their staking rights, making the staking process more efficient
  • Flexibility - Asset holders can terminate the lease at any time, allowing for greater flexibility in managing staking rights
  • Increased participation - LPoS encourages more participation in the network by allowing asset holders to lease their staking rights to others
  • Full control - Assets from the wallet address are not transferred anywhere


  • Reduced rewards - The rewards are reduced by node operators for their validating work, leading to reduced returns for the asset holder who leased them their staking rights
  • Complexity - LPoS adds an extra layer of complexity to the staking process, which may deter some users from participating
Firstly, investors should research and understand the LPoS mechanism thoroughly to make informed investment decisions. This may involve reviewing technical documentation, whitepapers, and engaging with other members of the DeFi community.

Secondly, it is crucial to evaluate the concentration of staking rights and the level of trust in the node operators. Asset holders should consider whether the node operators are reputable and have a track record of reliability.

Thirdly, asset holders should consider the rewards and fees associated with LPoS before participating in staking activities. It is essential to weigh the potential rewards against the fees and the potential risks involved.

Finally, asset holders should monitor the LPoS mechanism's performance and be prepared to adjust their staking activities accordingly. This may involve reallocating staking rights or terminating leases if necessary.

Analyst Opinion

LPoS is an interesting technology that, from my point of view, can improve the level of efficiency and decentralization of staking. Furthermore, it provides users with the possibility to “stake”, who would otherwise not be able to stake because they do not own enough assets (e.g., a minimum of 1,000 WAVES). Using LPoS allows us to minimize the use of mining pools, use of these pools can lead to centralization - something that no DeFi user wants. On the other hand, using LPoS can be quite technical and any potential investor should conduct their own personal research before using it.

Matěj Procházka

Matěj Procházka


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