Lido Dominance Prompts Warnings About Liquid Staking Derivatives - Decrypt

Lido Finance, the leading liquid staking solution for Ethereum, is causing concern among community members who believe it is undermining the decentralization of the Ethereum ecosystem, with Lido accounting for 32.7% of all staked ETH and potentially amassing undue influence over the network's governance. Critics warn that this centralization could harm Ethereum's reputation and long-term valuation, and Lido is exploring a "dual governance" model to address these concerns.

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Relevant topic timeline:

8/22/2023

Mantle Stakes $66M of Ether on Lido as Part of Treasury Management Strategy

Layer 2 network Mantle has staked 40,000 ether on staking protocol Lido, generating a yield of 4.1% APR and increasing its treasury value to over $3.2 billion, allowing community members to decide on treasury strategies.

8/25/2023

Lido Set To Complete Final Token Unlock

Leading Liquid Staking Protocol Lido Finance is unlocking nearly all of its 1B LDO tokens, providing an opportunity for token holders while potentially impacting the market.

9/1/2023

Ethereum staking services agree to 22% limit of all validators

At least five Ethereum liquid staking providers have committed to self-limit their ownership to 22% of the Ethereum staking market to ensure decentralization, while the largest provider, Lido Finance, voted against the self-limit proposal and currently holds a dominant market share.

9/11/2023

Lido Responds to LDO Token Contract Vulnerability, Says User Funds Remain Safe

Ethereum staking protocol Lido Finance has reassured users that their funds remain safe despite a known security flaw in Lido DAO's token contract that enables "fake deposit" attacks on exchanges, according to blockchain security firm SlowMist. Lido Finance argues that this flaw is present in all ERC-20 tokens and is not specific to Lido's LDO token. The company has pledged to update the token integration guides to address the issue.

9/14/2023

Lido to Bridge stETH to Cosmos Ecosystems, Bringing Millions in Liquidity to DeFi Apps

Lido, an ether staking giant, is collaborating with two Cosmos blockchain projects, Neutron and Axelar, to bridge its staked ether tokens to the Cosmos network, potentially transferring large amounts of liquidity between the two blockchains. This move aims to enhance the accessibility and usability of Lido's tokens on various blockchains within the Cosmos ecosystem.

9/16/2023

Ethereum Developers Slow Down Staking to Avoid Network Congestion

Crypto's most important commercial highway, Ethereum, risks being overwhelmed by the surging demand for staking, which could lead to network strain and a shortage of Ether for transactions. Developers are working on short-term measures to slow down the influx and exploring longer-term solutions to manage staking more effectively.

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Posted 9/4/2023, 12:04:07 AM