Lido Finance Declares L2 Expansion Strategy
Lido Finance, a protocol for liquid self-staking based on proof-of-stake blockchain, declared introducing its strategy for L2 expansion. The initial move in this respect will be to provide Ethereum-based staking derivatives on Optimism and Arbitrum, whereas sensibly securing the chief characteristics of the yield-bearing tokens of Lido.
Lido Finance Moves in Line with Post-Merge Ethereum
The local token of Lido Finance, LDO, has recently witnessed up to an 18% upsurge and its market capitalization has reached up to $860M. As the venue has a compatibility with the post-Merge Ethereum, the accomplishment of the final trial of the Merge has played a significant role in elevating the position of its valuation. The Goerli merge is considered to be the final test in advance of the mainnet merge anticipated to take place in the mid of September.
With the Merge, Ethereum – presently running on a proof-of-work consensus mechanism – will be migrated to proof-of-stake, which is considered to be an energy-effective consensus mechanism. Apart from enhancing the efficiency of the network, the respective advancement will reportedly improve the transfer speed of Ethereum along with the provision of additional security.
To leverage this grand opportunity, Lido has stepped ahead. Rather than staking an amount of up to $60k in ETH, the platform permits anyone to have a profit on any sum in ETH after staking it with the venue. Presently, a yield of 3.9% is offered by Lido Finance to its stakers. $8.28B is the amount of Lido’s total value locked, as suggested by the data taken from DefiLlama. Moreover, the platform possesses more than 90% share of the entire market of Ethereum as it is eventually transforming to PoS.
Lido’s business development head, Jacob Blish, stated that the concerns regarding the scaling of Ethereum will not be solved by the Merge solely. Furthermore, he added that it is just the starting point of the entire route to accomplish the scaling upgrades in the future. Simultaneous to this, the ETH staked on Beacon Chain is anticipated to stay locked up till 6 months following the completion of the Merge.
Lido Contemplates Launching Permissionless Onboarding
It is noteworthy that the permissionless approach of Rocket Pool firstly appears to be more decentralized, as opposed to the one of Lido Finance which requires permission. The team of Lido Finance has been operating on permissionless onboarding while keeping in view the performance reputation.