Derivative staked tokens represent a claim on the underlying, illiquid staking positions, which are nevertheless subject to the protocol limits. These tokenized and thus liquid claims can be employed in a variety of financial products. As a result, stakers may be able to earn higher returns or more easily manage their risk exposure in a variety of ways, such as by reducing the risks associated with validators.

Protocols that issue on-chain representations of staked assets on a decentralized network are referred to as liquid staking. Liquid staking protocols let users acquire liquidity on staked assets and use staked assets as collateral in (decentralized) financial applications through tokenization. Staking derivatives and programmable staking are two other words that have been used to characterize similar methods.

Liquid staking is a way to get extra utility from assets that are currently being staked.

This means that while your tokens are locked up and earning staking rewards, you can also use that same value elsewhere in other DeFi protocols — earning additional yield.()

In this bounty we were asked to check the trends around the price volatility and swap activity for staking ETH derivates from ankr, rocketpool and lido, which are aETH , rETH and stETH. \n

For this purpose I did the analysis in 2022 for these tokens. Checked their price, the volume of swap to and swap from and the count of transactions that added or removed liquidity from each of them.

Price of rETH(rocketpool derivative token) was always less than the price of aETH and stETH, except in the second half of May and 4 days in August, but during these exception days, it had even higher price than WETH. So, rETH was the most volatile token among the others.

liquid staking ETH derivates from ankr which is aETH, had the highest value among the other two in most of the days.

Value of Lido derivative token, was in the second rank of value in most of the days.

Now lets check the USD volume of swap from and swap to for each of these tokens in 2022:

Based on above analysis, stETH had by far the highest volume of trade, in both swapping from stETH and swapping to stETH.

The rETH swap from and swap to volume was about 6 times bigger than the swap volume of aETH.

The volume of swap from derivative token for aETH and stETH was bigger than swapping to these tokens. So, most volume of USD was swapping these two tokens, to another asset, while for rETH this was not like this and the most volume was swapping another assets to rETH.

Most volume of swaps for aETH, was on Feb and May, while the highest volume of swaps for rETH was on March. stETH highest volume was during May and June.

For all of these three token, volume of swaps, decreased during last 2 months.

In the below charts, I checked the count of transactions which added or removed liquidity for each of these tokens:

==stETH== had the highest number of transactions that added and removed liquidity. Number of transactions that removed liquidity was much more than providing liquidity transactions in May and June. so, this could be a reason for the least volatility of this token, because with a one transaction, users could not depeg stETH price in comparison with WETH.

For ==aETH==, in Jan number of providing liquidity transactions increased sharply, while in total number of transactions that removed liquidity, was bigger than providing liquidity transactions.

==rETH==, had the least number of transactions that added and removed liquidity, so, this could be a reason for the volatility of this token, because with a one transaction, depeging of this token could change sharply.

As you can see, number of transactions that removed liquidity was bigger than number of transactions that added liquidity for all of the tokens.