Lido Dominance Warns Against Liquid Staking Derivatives

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Last Updated on September 4, 2023 by Bitfinsider

Staking solution in liquid form Lido Finance currently accounts for roughly one-third of all Ethereum (ETH) staked, which has some community members concerned. They claim that Lido’s growing prominence is undermining Ethereum’s overall decentralised nature.

“Lido may be the biggest attack on Ethereum’s decentralisation (‘credible neutrality’) in our entire history,” stated Evan Van Ness, Ethereum’s chief decentralisation officer, in a Friday tweet.

According to Dune Analytics, the amount of ETH staked has increased over 95% in the last year, from just over $22 billion to around $41.6 billion. Lido accounts for 32.7% of all ETH invested on the market, roughly four times the amount staked by runner-up Coinbase, which is 8.7%.

Ethereum is created as a platform for decentralised applications based on smart contracts, and it underpins many of the DeFi ecosystem’s ecosystems and tokens. Lido is the largest decentralised platform for liquid staking ETH in this market, allowing investors to stake ETH with network validators and earn rewards. In exchange, they receive a token representing their deposit called stETH.

However, as it expands in size, opponents warn that Lido and other liquid staking systems risk gaining undue influence over Ethereum and becoming unduly centralised in how their decentralised autonomous organisations regulate themselves. This might undermine what they see as the DeFi space’s democratic ideal, in which users can use their tokens to vote on the future of initiatives.

How to buy or trade LDO on ProEX

You can buy or trade LDO on ProEX. As ProEX frequently holds campaigns and events, you should check out its event page here to see if you can participate and win rewards as you trade.

On ProEX, you can trade LDO as a spot pair (LDO/USDT) in 3 simple steps:

  1. Sign up and register an account on ProEX 
  2. Buy USDT via ProEX One-click Buy 
  3. Trade LDO/USDT at ProEX Spot

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