Lido Finance’s native token, LDO, has fallen almost 10% earlier this morning—representing the largest financial drop within the top 100 cryptocurrencies on the market. It has since recovered, however, from today's low of $1.91 to roughly $2 at press time.
The bearish move comes amid weeks of stagnant appetite for Ethereum staking services within the market.
Lido Finance is a liquid staking service for Ethereum, Polygon, Solana, and other crypto networks. Launched in December 2020, the DAO platform provides a competitive yield of 3.8% for ETH deposits without the necessity for industry-sized infrastructure. Liquid staking refers to the process of depositing Ethereum, for example, but getting another token in return that can be used elsewhere in the market (hence the word liquid).
Dune Analytics data reveals that Ethereum deposited on a weekly basis has fallen to 33,204.
This stands in stark contrast to the merry heights of March and April this year in which staking on the beacon chain remained above 237,000 for nine weeks out of a consecutive ten.
Weekly Ethereum Staking Deposits Hit Record Low Just Weeks Before Merge
With less than a month to go until Ethereum’s transition to proof of stake, the number of weekly ETH deposits sent for staking on the Beacon Chain has hit an all-time low, as per data from Dune Analytics. The reasons behind this recent drop are myriad, ranging from speculators banking on a new airdrop to others who are worried the merge won't go quite as planned. Hildebert Moulié, a data scientist at Dragonfly Capital who goes by the handle hildobby on Twitter, told Decrypt that the sharp declin...
Assessing the performance of Lido Finance against other beacon chain depositors, it’s evident that the liquid staking solution has experienced a period of stagnation since May.
Lido’s 50,000 new depositors since May 9 have been exceeded by Coinbase at 131,000, Kraken at 98,000, and Binance at 59,000, though Lido still retains a healthy majority market share of 30.88%.
Ethereum merge event slated for next month
Ethereum’s highly-anticipated transition to proof-of-stake has been slated for September 15.
The event, also called the merge, has sparked activity among various exchanges, too, with some even supporting a potential forked Ethereum token called ETHPOW.
According to the Ethereum Foundation, the transition is also expected to render the network more energy-efficient network by 99.95%.
Still, and as Ethereum's co-founder Vitalik Buterin said in July, Ethereum will only be around 55% complete in its roadmap following the merge.
Conversely, Bitcoin, argues its community, is over 80% developed.
