No.172
Lido LDO
Ethereum liquid staking
π the patient valet who minds your ETH treasury and hands back a receipt you can still spend
π¬ βHand me your ETH, no need for the full 32. I set it to work behind the scenes and give you a stETH receipt right back. Keep spending it, lending it, trading it, and the rewards still tick up while you do.β
- The pitch: running an Ethereum validator alone needs 32 ETH and locks your coins up. Lido drops both walls.
- How: stake any amount, get stETH, a token that keeps earning and that you can still use anywhere in DeFi.
- Launched: December 2020; the LDO governance token followed in January 2021.
- LDO: an ERC-20 governance token, total supply fixed at 1 billion, voting power inside the Lido DAO.
π The Story
December 2020. Ethereum had just opened its staking doors, and the rules were stiff: you needed exactly 32 ETH to run a validator, and once you staked, the coins were frozen with no way out yet. Most people had neither that much ETH nor the patience to lock it away. A small group of early Ethereum builders, Konstantin Lomashuk, Vasiliy Shapovalov, and Jordan Fish (better known online as Cobie), launched Lido to knock both walls down at once.
The trick was simple to describe. You hand Lido any amount of ETH. It pools everyone's deposits together, passes them to a curated set of professional node operators who run the real validators, and gives you back stETH, a token standing in for your stake. That stETH is the clever part: its balance quietly grows each day as rewards land, yet it stays free to move. You can trade it, lend it, or drop it into other protocols, all while the ETH underneath keeps earning.
January 2021. The LDO token arrived, the steering wheel for the whole thing. Holders form the Lido DAO and vote on upgrades, fees, which node operators get added or shown the door, and how the treasury is spent.
May 15, 2023. Lido V2 went live and closed the last gap. Until then you could stake but not directly unstake through Lido; V2 enabled plain stETH-to-ETH withdrawals. By the mid-2020s Lido had grown into the largest liquid-staking protocol on Ethereum, with hundreds of node operators behind it.
π Stats
These bands are our editorial read of Lido's character, not live market data.
𧩠How it works
Picture a coat check. You deposit your ETH and walk away with a ticket, stETH. The coat (your stake) is busy earning in the back room; the ticket is yours to carry, trade, or lend in the meantime. Whenever you want, the ticket trades back for the coat plus everything it earned.
π Light & Shadow
- No 32-ETH wall and no lock-up to choose between. Stake any amount and keep your stETH free to use
- stETH is widely accepted across DeFi, so the same ETH can earn staking rewards and be put to work elsewhere
- The largest liquid-staking protocol on Ethereum, with hundreds of node operators spreading the validator duty rather than one machine
- Its own size is a worry. Because Lido controls such a large slice of all staked ETH, critics warn it edges Ethereum toward too much concentration in one protocol
- You are trusting Lido's smart contracts and its chosen node operators. A bug or an operator failure could dock rewards or worse
- stETH usually tracks ETH closely, but in stressed markets the two can drift apart for a while, so the receipt is not always worth exactly one ETH on the open market
𧬠Evolution lineage
Lido is not a fork of any coin. It is an app that lives on top of Ethereum, with LDO as its ERC-20 governance token. Its peers are other liquid-staking protocols, like Rocket Pool (RPL), rather than rival blockchains.
π§ Meet other friends
β FAQ
- What is Lido?
- A liquid staking protocol on Ethereum. You stake any amount of ETH, with no 32-ETH validator minimum, and Lido hands you stETH, a token that keeps earning staking rewards while you stay free to trade it or use it elsewhere in DeFi.
- What is stETH?
- The receipt Lido gives you for your staked ETH. Its balance grows a little each day as rewards arrive, and you can move it, trade it, or lend it across other protocols while the underlying ETH keeps working.
- What does the LDO token do?
- LDO is the governance token of the Lido DAO. Holders vote on upgrades, fees, which node operators are added or removed, and how the treasury is spent, with voting weight set by how much LDO they hold. Total supply is fixed at 1 billion.
- Is Lido its own blockchain?
- No. Lido is a set of smart contracts on Ethereum, and LDO is an ERC-20 token. It is an app built on Ethereum, not a separate Layer 1 network.
β οΈ Not investment advice. All figures are for information only