xALGO Liquid Staking Review 2026: Folks Finance's Algorand LST

xALGO is the liquid staking product from Folks Finance, a DeFi protocol on Algorand. DefiLlama lists it in the Liquid Staking category with about $25.7M in TVL and describes it as an interest-bearing liquid token for Algorand staking. It has been listed since July 2023.

The Folks Finance homepage calls xALGO Algorand's leading liquid staking token, with a focus on security, liquidity and rewards. Those are the project's own claims and the project does not independently verify them. The same app also offers deposits, loans, swaps through Folks Router, Ultraswap, a points program and the xPortal cross-chain transfer tool.

Public sources have some loose ends. The homepage shows a 0% APR beside the xALGO card, and a search snippet from the project's X account says xALGO will return as the primary liquid staking product on Algorand. The project does not explain either point, so readers should confirm the current status in the official docs before staking.

With liquid staking, you deposit ALGO and receive a token, here xALGO, that represents your staked position. DefiLlama describes xALGO as an interest-bearing liquid token, meaning staking rewards accrue to the token rather than being paid out separately.

Because you hold a token, you can keep using it. Folks Finance material says xALGO can be used as collateral to borrow, supplied to lending pools, paired in liquidity pools, traded, or put into loop strategies. These uses sit on top of the staking position and add their own risks.

The exact mechanism for how rewards are generated and distributed, and how xALGO is redeemed for ALGO, is not detailed publicly. The Folks Finance documentation covers xALGO and architecture topics.

Fees for xALGO are not published. The homepage shows a '0 % APR' figure next to the xALGO card, but does not say how rewards or any protocol fee are calculated.

Before staking, check the Folks Finance app and its documentation for the current reward rate, any protocol fee on rewards, swap costs through Folks Router and Algorand network fees.

DefiLlama lists 2 audits for the protocol, but the project does not name the auditors or give their findings. Staking through any liquid staking protocol means trusting its smart contracts, and a bug could put staked ALGO at risk. Users should read the audit reports in the Folks Finance docs.

Using xALGO as collateral or in loop strategies adds liquidation risk and exposure to the price of xALGO relative to ALGO. Public sources say nothing about past incidents, insurance or regulatory status, so those points are not covered here.

xALGO is for Algorand holders who want to stake ALGO without locking it up and who may want to lend, borrow or provide liquidity with the resulting token. It is less suited to people who want a simple custody-light setup, or who are not ready to manage DeFi risks such as liquidation.