This proposal is expected to appear on Snapshot for voting on 2021-07-05T16:00:00Z.
TL;DR
- Proposal to whitelist Lido wstETH
- Proposed co-investment is 350K BNT.
- There are no apparent security concerns that would prohibit whitelist status.
- Lido is an established platform for Ethereum 2.0 staking
Token Address: 0x7f39c581f595b53c5cb19bd0b3f8da6c935e2ca0
Project Website: lido.fi
Token Security
wstETH does not have an elastic supply or rebase mechanism. The token contract appears to be a standard OpenZeppelin contract.
Due to the nature of Lido stETH the amount of your balance is not constant - it changes daily as staking rewards come in. This is what’s known as a rebasable token. In the case of stETH, this is reflected through a daily token balance change to reflect your earned rewards. Wrapping stETH creates a DeFi-compatible version of the stETH token which allows for easier integrations with DeFi protocols such as Bancor.
Lido’s wstETH is a wrapped token based on stETH. stETH is a token that represents staked ether in Lido, combining the value of initial deposit + staking rewards (from ETH2 blockchain). stETH tokens are minted upon deposit and burned when redeemed. stETH token balances are pegged 1:1 to the ethers that are staked by Lido. stETH token’s balances are updated when the oracle reports change in total stake every day.
wstETH does not have a fixed supply and there is roughly 1950 stETH locked in the smart contract. The highest concentration of wstETH is locked in ARCx to mint their stable coin. The rest appear to be regular ETH holders:
Project
Lido is a staking solution for ETH 2.0 backed by several industry-leading staking providers. It makes staked ETH liquid and allows participation with any amount of ETH.
When using Lido to stake your ETH on the Ethereum beacon chain, users will receive a token (stETH), which represents their ETH on the Ethereum beacon chain on a 1:1 basis. It effectively acts as a bridge bringing ETH 2.0’s staking rewards to ETH 1.0.
As a user’s staked ETH generates staking rewards from ETH 2.0, the user’s ETH balance on the beacon chain will increase. stETH balances will update correspondingly once per day allowing you to access on ETH 1.0 the value of your staking rewards received on ETH 2.0.
Users can use stETH in all of the same ways that they can use ETH: sell it, spend it and, since it is compatible to be used in DeFi, use it as collateral for on-chain lending. When transactions are enabled on ETH 2.0, users can also redeem stETH for ETH.
Tokenomics
Users who stake their ETH into the Eth2 contract via Lido will receive the liquid token equivalent in the form of stETH. For the sake of simplicity, this means that if you stake 1 ETH with Lido, you receive 1stETH in return.
stETH allows users to participate in the DeFi ecosystem whilst still accruing Eth2 rewards earned from staking during Phase 0.
stETH accrues staking rewards regardless of where it is acquired. This means that regardless of whether you acquire stETH directly from staking via stake.lido.fi, purchase stETH from 1inch or receive it from a friend, it will rebase daily to reflect Ethereum staking rewards.
This nullifies the downsides from staking into the Eth2 contract directly: illiquidity, immovability, inaccessibility. Instead of locking up your staked ETH, Lido allows you to put it to use so you don’t need to choose between Ethereum staking and DeFi participation.
For more information see:
Investors
Lido raised $2 million in a Dec. 2020 round backed by Semantic Ventures, ParaFi Capital, Terra, KR1, Stakefish, and Staking Facilities, among others. Angel investors, including Rune Christensen of MakerDAO, Stani Kulechov of Aave, and Kain Warwick of Synthetix, also participated in the round.
Lido also recently (May 2021) raised $73 million in a round led by paradigm capital.
Community and Communication
The Lido team operates an official Twitter, Blog, and Reddit account. The repositories for their code is hosted on GitHub. There is a Telegram and Discord channel that is available to their community. The official documentation is hosted on GitHub. There is also a governance forum that’s available to their community members.
Available Audits
There are three audits available from different firms for Lido:
Market and Trading Data
Stats are for stETH as wstETH is not yet listed on coingecko.
- stETH price at the time of writing is $1,822.35
- All-time high: $4,309.29 (May 12, 2021)
- All-time low: $482.90 (Dec 22, 2020)
- Price 90 days ago: $1847.85
- 539,678 tokens in circulation
- maximum supply based on the amount of ETH locked via Lido in ETH2.
- The current market capitalization is $983,483,853
- Token Fully Diluted market Capitalization $983,483,853
- The stETH token is available on DEX (Uniswap, 1inch, Curve)
- The highest 24-hour volume on DEX (Curve) is around ~$2M.