The blockchain ecosystem continues to evolve, bringing opportunities for innovation and growth. However, as blockchains scale, challenges like liquidity constraints, inefficient staking processes, and fragmented trust systems emerge. These issues hinder developers and stakers, reducing their ability to maximize returns and secure decentralized applications.

MilkyWay, the first modular staking portal, addresses these challenges. By offering liquid staking and restaking solutions, it provides stakers with flexibility and developers with scalable security options. Stakers retain liquidity through tokenized staking positions, enabling them to earn rewards while participating in decentralized finance (DeFi). Developers, on the other hand, leverage a modular restaking framework to secure their projects efficiently without designing separate validator sets or attracting stakers.

What is MilkyWay?

Source: Milkyway Website

MilkyWay is a modular staking portal combining liquid and restaking to unify liquidity and security across blockchain ecosystems. Initially developed for the Celestia blockchain, it allows TIA token holders to stake assets without losing liquidity. This ensures users can continue participating in DeFi activities while earning staking rewards.

MilkyWay simplifies staking for modular ecosystems, offering users a single gateway to access staking, liquidity, and security services. Allowing multiple services to tap into a shared pool of staked assets reduces inefficiencies, streamlines operations, and amplifies yields.

The Mission and Vision Of MilkyWay

MilkyWay’s mission is to become modular ecosystems’ leading liquidity and security hub. Its vision is to reduce complexity, enhance scalability, and enable interconnected blockchain environments. By consolidating fragmented trust and offering seamless staking solutions, MilkyWay aims to empower developers and stakers to thrive in the rapidly expanding modular blockchain landscape.

Technology Behind MilkyWay

MilkyWay is built on a sophisticated and robust technological framework designed to ensure security, scalability, and transparency. Integrating advanced tools and protocols delivers seamless and efficient staking and restaking solutions for users and developers within the modular blockchain ecosystem.

CosmWasm Contracts

At the core of MilkyWay’s architecture are CosmWasm contracts, deployed on the Osmosis blockchain. These smart contracts handle essential operations such as managing TIA deposits, issuing liquid staking tokens like milkTIA, and processing withdrawals. By automating transactions and ensuring secure execution, CosmWasm enables a reliable and transparent staking experience.

MilkyWay Daemon

The MilkyWay Daemon is an off-chain program critical to the interaction between the staking contracts on Osmosis and the Celestia blockchain. It monitors inter-blockchain communication (IBC) transfer transactions, listens to relevant events, and aggregates validator signatures to facilitate multi-signature transactions. This ensures seamless coordination between staking and restaking operations.

Multisig Custody System

To enhance security, MilkyWay employs a multisig custody mechanism. This system requires multiple trusted validators to authorize transactions, reducing risks associated with single points of failure. Initially launched with nine validators, including Stake.fish and Cosmostation, this system safeguards billions of dollars across blockchain ecosystems.

Cosmos SDK Authz Module

MilkyWay integrates the Cosmos SDK Authz module to introduce liquid staking derivatives for the Celestia ecosystem. This module ensures efficient and secure staking and restaking operations, supporting advanced authorization mechanisms to maintain transaction integrity.

How MilkyWay Works

MilkyWay bridges the gap between traditional staking and the need for liquidity by offering tokenized staking positions through liquid staking derivatives. Here’s how it operates:

1. Liquid Staking: Users stake their TIA tokens on the MilkyWay platform, locking them into a staking contract. In return, they receive milkTIA, a tokenized representation of their staked assets. MilkTIA accrues staking rewards over time and can be used across various DeFi platforms.
2. Restaking: Restaking allows users to utilize their staked assets for securing additional services. Users maximize their returns by delegating TIA or liquid staking tokens (LSTs) to specific operators or actively validated services (AVSs) while contributing to decentralized security.
3. Validation Services: Developers delegate validation tasks to ensure decentralized and secure operations. This modular restaking layer adapts to unique project needs, allowing developers to focus on building while MilkyWay handles security.
4. Multi-Asset Support: MilkyWay supports multiple assets for staking and restaking, including TIA, BTC, ETH, and stablecoins like USDT and USDC. This flexibility enhances user participation and yield generation.
5. Multi-Slashing Rules: Milky Way’s multi-slashing mechanism penalizes validators for various misbehaviors like double signing, downtime, and equivocation, enhancing network security.
6. Multi-Asset Support: It supports numerous token standards, enabling cross-chain interactions and easy asset creation for diverse applications, boosting ecosystem liquidity and utility.
7. AVS Centric: With an Application-Specific Validation focus, Milky Way allows custom validation logic per app, improving scalability and security by tailoring validation to specific needs

Use Cases of MilkyWay

Stakers

For individual stakers, MilkyWay offers a unique combination of earning rewards and maintaining liquidity. By staking TIA tokens, users receive liquid staking derivatives like milkTIA, which not only represent their staked assets but also accrue rewards automatically. Unlike traditional staking, MilkyWay allows stakers to utilize milkTIA in DeFi platforms for trading, lending, borrowing, or collateralizing. This ensures that users can actively participate in DeFi ecosystems without sacrificing their staking rewards, maximizing flexibility and returns.

Developers

MilkyWay provides developers with a plug-and-play security framework that eliminates the complexities of designing custom validator sets or attracting stakers to bootstrap their projects. Through the modular staking protocol, developers can tap into a shared pool of staked assets, ensuring robust and scalable security. This simplifies the process of building decentralized applications while maintaining high-security standards.

Validators

Validators benefit by expanding their revenue streams through MilkyWay’s modular framework. By securing multiple Actively Validated Services (AVSs), they can participate in diverse staking and restaking activities, further enhancing their earnings while contributing to decentralized security.

Investors

Liquidity providers and investors can diversify their portfolios by engaging with MilkyWay’s ecosystem. The platform’s integration with modular chains and restaking services offers investors opportunities to earn additional returns while supporting innovative blockchain projects.

DeFi Ecosystems

MilkyWay plays a pivotal role in DeFi ecosystems by integrating with platforms such as Camelot, Osmosis, and Demex. This integration allows users to leverage their staked assets across DeFi protocols, enabling seamless trading, lending, and borrowing activities.

MilkyWay Products

MilkyWay offers two flagship products designed to redefine staking and security within the modular blockchain ecosystem.

Modular Liquid Staking

MilkyWay’s Modular Liquid Staking service allows users to stake their assets without locking them up. Users who stake tokens such as TIA on the platform receive liquid staking derivatives like milkTIA. These derivatives represent their staked positions and accrue rewards over time. What sets this product apart is its ability to retain liquidity. Users can deploy milkTIA in decentralized finance (DeFi) protocols to maximize their returns. For example, they can trade, lend, borrow, or use milkTIA as collateral on platforms like Camelot, Osmosis, and Demex. This dual-purpose system enhances capital efficiency by enabling users to earn rewards while actively participating in DeFi ecosystems.

Modular Restaking Protocol

MilkyWay’s Modular Restaking Protocol serves as a security marketplace for blockchain projects. Developers can borrow security from a shared pool of staked assets, eliminating the need to create their own validator sets or design staking mechanisms. Restakers can delegate their assets to secure additional services, multiplying their returns. This protocol supports a wide range of assets, including liquid staking tokens (LSTs) like milkTIA, stTIA, and dTIA, as well as other modular assets like USDT, BTC, and ETH. By unifying liquidity and security, the restaking protocol streamlines processes and enables developers to bootstrap security with ease.

Both products embody MilkyWay’s mission to optimize capital efficiency, enhance security, and provide seamless staking and restaking solutions for the modular blockchain ecosystem.

How to Use MilkyWay

Getting started with MilkyWay is straightforward and designed to provide a seamless staking experience. Follow these steps to maximize your rewards and capitalize on the platform’s offerings:

Step 1: Acquire TIA Tokens
To begin, you need to purchase TIA tokens, the native asset of the Celestia blockchain. TIA tokens are available on supported exchanges like Gate.io. Ensure your wallet is compatible with the Osmosis blockchain to facilitate easy transfers and staking.

Step 2: Transfer TIA to MilkyWay
Once you have TIA tokens, transfer them to the MilkyWay platform using the Inter-Blockchain Communication (IBC) Transfer module. This step ensures that your tokens are securely moved from the exchange to MilkyWay’s staking environment.

Step 3: Stake TIA
After transferring your tokens, stake your TIA on the MilkyWay platform. Staking involves locking your tokens into a smart contract, enabling you to earn auto-compounding staking rewards while contributing to the security of the Celestia network.

Step 4: Receive milkTIA Tokens
Upon staking, you’ll receive milkTIA, a liquid staking derivative that represents your staking position. These tokens are on-chain assets that accrue rewards over time, increasing in value as staking rewards are auto-compounded.

Step 5: Utilize milkTIA in DeFi
MilkyWay extends the utility of your staked assets by enabling milkTIA to be used across various DeFi platforms such as Camelot, Osmosis, Demex, and others. You can use milkTIA for trading, lending, borrowing, or as collateral to maximize returns.

Step 6: Restaking
To further enhance your earnings, delegate your milkTIA or other supported assets to secure additional services. Restaking lets you contribute to the security of other blockchain projects while earning additional rewards.
MilkyWay’s streamlined processes ensure that users, from beginners to intermediates, can efficiently stake, earn, and participate in the modular ecosystem without technical complexities.

MilkyWay Rewards Program: mPoints

MilkyWay’s mPoints system is designed as an innovative reward mechanism for participants within its ecosystem, providing incentives for both holding and actively using the platform’s assets.

How the MilkyWay Rewards Program Works

• Holding milkTIA: Participants can earn mPoints simply by holding milkTIA in their wallet. MilkyWay captures daily snapshots of milkTIA balances, granting 1 mPoint per milkTIA held each day. To qualify for this, milkTIA must be on the Osmosis chain, which is its primary minting location.
• DeFi Engagement: Beyond passive holding, users can increase their mPoints by engaging in DeFi activities with milkTIA on whitelisted protocols. This engagement earns at least 1.25 mPoints per milkTIA daily. The exact protocols eligible for these rewards are listed on the MilkyWay app, encouraging users to stay updated to maximize their rewards.
• Eligibility and Tracking: mPoints do not reside on-chain like traditional tokens. Instead, users can track their accumulation through the mPoints leaderboard on MilkyWay’s website, which updates daily. This system ran throughout 2024 with multiple versions to enhance user engagement and reward distribution.

MilkyWay Team

MilkyWay’s success is anchored by a team of blockchain veterans with extensive experience in the industry:

• JayB Kim: A seasoned professional who previously served as the Chief Technology Officer at Cosmostation, JayB brings in-depth knowledge of blockchain technology. His impressive portfolio includes pivotal roles at Tendermint, where he contributed to building foundational blockchain frameworks, and Crescent, where he focused on developing innovative solutions.
• Josie Leung: With a strong background in product development and business strategy, Josie has held critical roles at Tendermint and Crypto.com. Her expertise in business development and fostering partnerships has been instrumental in MilkyWay’s growth and its seamless integration into the broader blockchain ecosystem.
• Joon Whang: Known for his technical prowess, Joon’s career includes contributions to Tendermint, Cosmostation, and Composable Finance. His hands-on approach to solving complex technical challenges has played a key role in shaping MilkyWay’s architecture and ensuring platform scalability.

MilkyWay Fundraising

MilkyWay secured an impressive $5 million in a seed funding round, attracting support from some of the most renowned names in the blockchain and crypto space. The funding round was led by prominent investors such as Polychain, Binance Labs, and Hack VC, demonstrating confidence in MilkyWay’s vision and potential. In addition to these key players, the project also gained the backing of angel investors, who had a significant influence on the blockchain ecosystem. Notable contributors include Mustafa Al-Bassam, co-founder of Celestia, George Lambeth, Celestia’s inaugural investor, as well as other distinguished figures such as Batuhan Dasgin, Stan (Initia co-founder), and Michael Ng (founder of StakeWithUs).

The $5 million investment is pivotal in driving MilkyWay’s mission forward. These funds are allocated toward scaling the team, enhancing operational efficiency, and accelerating the development of the modular ecosystem. By prioritizing innovation and growth, MilkyWay aims to deliver cutting-edge solutions for its users while solidifying its position as a leader in modular blockchain infrastructure. This funding ensures the platform’s sustainability and reinforces its commitment to providing value to the broader blockchain community.

Conclusion

MilkyWay is a pioneer in modular staking, offering innovative solutions bridging the gap between liquidity and security. Enabling seamless staking, restaking, and DeFi integration empowers users and developers to unlock the full potential of modular blockchain ecosystems.