A “deposit contract” is a smart contract that allows users to deposit cryptocurrency into a blockchain protocol, typically through the use of a validator node. While deposit contracts typically allow users to deposit tokens into a validator node to help the network maintain operational efficiency, they can also be used within a decentralized finance (DeFi) protocol that allows the use of specific financial instruments (such as staking, lending, and borrowing), allowing users to accrue incentivized token rewards.
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