In about three days, Ethereum is expected to transition from a proof-of-work (PoW) blockchain network to a proof-of-stake (PoS) version via The Merge. Prior to the transition, the Lido liquid staking project saw much more activity, with the value locked in the protocol increasing by more than 13% this week. Additionally, the project’s lido dao governance token has risen 25.4% against the US dollar in the past seven days.
Lido TVL jumps 13% this week, project-wrapped ether accounts for over 30% of staked Ethereum
Last week, Bitcoin.com News reported on decentralized finance (defi) project Lido as the project began to see more demand ahead of The Merge. Financing of the Lido is a liquid staking project that allows people to wrap their crypto assets in order to collect a staking yield, but the process also allows owners to hold the assets non-custodially and also be able to trade them.
Lido offers liquid staking solutions for blockchains like Ethereum, Solana, Polygon, Polkadot, and Kusama. However, most of the value locked in Lido comes from locked ether, because ETH represents $7.61 billion of Lido’s $7.81 billion total value locked (TVL).
In the past seven days, metric from defillama.com reports that Lido TVL has inflated by 13.08% and TVL has increased by 2.43% in the last 24 hours. While Makerdao is the largest defi protocol today, in terms of TVL stats, Lido is the second largest defi protocol on 9/11.
The ether locked in the Lido app alone accounts for 12.60% of the $60.38 billion TVL in challenge today. Lido Wrapped Aether Derivative Token, STETH, is the 13th largest market cap out of 12,907 tokens worth $1.1 trillion. Lido Governance Token lido dao (LDO) increased by 25.4% in the last two weeks.
Three major exchanges and 8 Ethereum 2.0 pools
Data from Dune Analytics shows that Lido is the largest depositor in the Beacon chain with 30.3% of deposits coming from Lido Finance. Coinbase is second to Lido with 14.5% of Beacon chain deposits and Kraken controls 8.3%.
Coinbase recently launched a liquid staking token called coinbase wrapped ethereum (CBETH), and in mid-August, a JPMorgan market analyst said Coinbase could be a big beneficiary of the Ethereum merger transition. At press time, there are 13,638,351 ethers locked up in the ETH 2.0 and there are 426,198 validators. 30.49% of 13.6 million ETH staked is staked via Lido Finance.
Besides massive exchanges like Coinbase, Kraken, and Binance, Lido competes with Stkr, Sharedstake, Stafi, Stakewise, Cream, Stakehound, and Rocketpool. Between Lido, Rocketpool, Stakehound, Stakewise, Stafi, Sharedstake, and Stkr, there’s around $8.11 billion in value.
What do you think of the recent action of Lido Finance and the amount of ether eight pools held? Let us know what you think about this topic in the comments section below.
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