The decentralized finance (DeFi) landscape is always changing, bringing new ways to get the most out of your crypto assets. At the forefront of this evolution is KernelDAO, which offers a robust restaking ecosystem. Kelp is a key part of KernelDAO, allowing you to liquid restake your Ethereum-based Liquid Staking Tokens (LSTs) and earn extra rewards.
This guide will take you through the steps to use Kelp to boost the yield on your staked ETH, all laid out in a clear way.
What is Kelp and Why Should You Use It?
Kelp is a liquid restaking protocol on Ethereum (and compatible Layer 2s) that operates within the KernelDAO ecosystem. It enables you to:
Restake your LSTs: Rather than your staked ETH just sitting there locked up, Kelp lets you deposit existing Liquid Staking Tokens (like stETH or ETHx).
Mint rsETH: When you deposit your LSTs, Kelp gives you rsETH, a liquid restaking token. This rsETH shows your restaked position while remaining liquid, so you can still use it in other DeFi protocols and keep earning restaking rewards.
Earn Dual Rewards: You’ll keep getting your original staking rewards from your LSTs and also earn extra rewards from EigenLayer services thanks to Kelp's mechanism for restaking.
Maintain Liquidity: Unlike traditional staking, with rsETH you have liquidity, which means you can engage in other DeFi activities without locking away your capital completely.
Step-by-Step Guide: How to Use Kelp
To start using Kelp, you’ll need an Ethereum-compatible wallet (like MetaMask or Rabby) and some Liquid Staking Tokens (LSTs) such as stETH, rETH, or cbETH.
Let’s dive in.
Step 1: Set Up Your Wallet and Get LSTs
Install a Web3 Wallet: If you haven’t already, download and set up a Web3 wallet such as MetaMask or Rabby as a browser extension.
Switch to Ethereum Mainnet: Make sure your wallet is connected to the Ethereum Mainnet. Kelp mainly works on Ethereum, though it may support some Layer 2 solutions.
Get Liquid Staking Tokens (LSTs): You’ll need LSTs like stETH, rETH, or cbETH. If you only have ETH, you can convert it to an LST on platforms like Lido (for stETH), Rocket Pool (for rETH), or Coinbase (for cbETH). Make sure to send these LSTs to your connected wallet.
Step 2: Connect to the Kelp dApp
Go to the Kelp dApp: Open your web browser and head over to the official Kelp dApp website. (Always double-check the URL to avoid phishing scams. Official addresses usually look something like app.kelpdao.com or kelpdao.xyz, but make sure to verify them via KernelDAO's sources).
Click on "Connect Wallet": When you're on the Kelp dApp, look for the "Connect Wallet" button, which is usually at the top right. Give it a click.
Choose Your Wallet: Pick the wallet you like best (like MetaMask).
Approve the Connection: Your wallet will pop up, asking if you want to connect to the Kelp dApp. Take a look at the request and approve it.
Step 3: Pick Your Token and How Much to Restake
Go to the Restaking Section: After connecting your wallet, you should see a "Restake" or "Deposit" area on the Kelp dApp dashboard.
Select Your LST: From the available tokens, choose the LST you want to restake (for example, stETH or ETHx).
Enter the Amount: Type in how much of the chosen LST you want to put into Kelp. You should be able to see your available balance.
Step 4: Approve and Restake Your LSTs
Hit "Approve": If this is your first time using Kelp with that specific LST, you’ll need to "Approve" the contract to spend your tokens. Just click the "Approve" button.
Confirm the Approval in Your Wallet: Your wallet will ask you to confirm the approval transaction. Keep in mind this will come with a small gas fee in ETH. Check the details and confirm it.
Click on "Restake" (or "Deposit"): After the approval transaction is confirmed, the "Approve" button will probably change to "Restake" or "Deposit." Just click it.
Confirm the Restaking Transaction in Your Wallet: Your wallet will ask you to confirm this restaking transaction too, and it’ll also have a gas fee in ETH. Confirm it.
Step 5: Get and Use Your rsETH
Receive Your rsETH: Once the restake transaction is confirmed, you'll get rsETH tokens in your wallet. The amount you receive will be based on how much LST you deposited, adjusted for the conversion rate.
Keep an Eye on Your Rewards: Kelp's dashboard should show your restaked position and any rewards you've earned. You can check your combined staking and restaking yields here.
Utilize rsETH: One of the great things about rsETH is its liquidity! You can:
Hold it to keep earning restaking rewards.
Deposit it into other DeFi platforms (like lending services such as Aave or Compound, or liquidity pools) to earn even more yield.
Trade it on decentralized exchanges (DEXs).
Think about putting your rsETH into KernelDAO's Gain Vaults for optimized, automated yield strategies.
Step 6: Withdraw When You’re Ready
When you're ready to unstake your assets, head over to the "Withdraw" tab on the Kelp dApp. Enter how much rsETH you want to convert back to your original LSTs and follow the prompts to confirm the transaction. Just be aware that unstaking might take some time, depending on the LST and network conditions.
Tips for Success and Notes:
Gas Fees: All your actions on the Ethereum network need gas fees (paid in ETH). Make sure you have enough ETH in your wallet to cover these costs.
Security: Always double-check that you're on the official Kelp dApp site. Be cautious of phishing scams, and don’t share your private keys or seed phrase with anyone.
Research: Before you dive in with larger amounts, make sure to do your own research (DYOR) on the risks that come with restaking and the specific protocols involved.
Start Small: If you’re new to restaking, it might be wise to start with a smaller amount to get the hang of it.
Community: Join the KernelDAO and Kelp communities on social media (like X/Twitter and Discord) to stay informed and ask any questions you might have.
By going through this guide, you should now be ready to explore the Kelp protocol within the KernelDAO ecosystem and possibly boost your crypto earnings with liquid restaking. Happy yield farming!
