In about three days, Ethereum is expected to transition from a proof-of-work (PoW) blockchain network to a proof-of-stake (PoS) version through 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. Lido Finance is a liquid staking project that allows people to wrap their crypto assets 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, as ETH accounts for $7.61 billion of Lido’s total locked value (TVL) of $7.81 billion.
Over the past seven days, measurements from defillama.com indicate that Lido’s TVL has inflated by 13.08% and TVL has increased by 2.43% over the past 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 ether-derived token, STETH, is the 13th-largest market cap out of 12,907 tokens worth $1.1 trillion. The Lido governance token, lido dao (LDO), has risen 25.4% over the past 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 ether locked in the ETH 2.0 contract and there are 426,198 validators. 30.49% of the 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.
While Lido controls 30.49% of the ETH staked, the aforementioned ETH 2.0 pools account for 33.11% of the ether staked today. There are 4,585,038 locked ethers held between the eight ETH 2.0 pools today.
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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