- Ethereum’s Shanghai update could fuel the growth of staking protocol Lido.
- Lido faced challenges as APR dropped and activity on the network decreased.
of Ethereum [ETH] The Shanghai Update, scheduled to be published in the first quarter of 2023, will introduce staking to the ETH protocol. This update could catalyze significant growth for staking protocols such as Lido. [LDO].
Currently, when Ethereum is staked, there is no way to unstake or acquire it.
Is your LDO holding flashing green? Check the profit calculator
However, the upcoming Shanghai update will prioritize the ability to withdraw staked Ethereum. This minimizes potential risk for long-term holders who have been betting on Ethereum since the Beacon Chain went live in December 2020.
At the time of writing, ETH’s staking rate is currently low compared to other protocols such as Binance Coin. [BNB]Cardano [ADA] And Solana SOL.
Source: Messari
bet it
However, the introduction of staking in the Shanghai update could help increase ETH staking rates. This could be a positive development for Lido and other staking protocols.
The growing number of ETH staked on Lido suggests that, prior to writing, more users were taking advantage of the staking opportunities offered by the protocol.
Source: Dune Analytics
However, Lido observed a decline in annual rate (APR). This may affect the protocol’s attractiveness for users looking to earn staking rewards.
In addition, according to Messari, Lido has seen a decline in both total revenue (-18.80%) and unique users (-24.17%) over the past period. Total revenue collected was $25.39 million and he had 11,017 unique users at the time of writing.
Source: Dune Analytics
What does Lido HODLer do?
Despite these negative developments, interest in LDO tokens has grown. This is demonstrated by the increase in his MVRV ratio of LDOs, indicating that the token holders will be able to make a profit if they sell it at press time.
How many LDOs can I get for $1?
However, the long/short gap indicates that many short-term holders observed gains, which means there was more selling pressure.
LDO token activity has also decreased, as indicated by the slowdown in LDO speed. As a result, the frequency of replacing LDOs has decreased.
Source: Santimento
Overall, the Shanghai update could have a positive impact on Lido by increasing ETH staking rates and attracting more users to the protocol. However, declining APR and activity on the network are concerns that Lido needs to address in order to maintain its market position.
At the time of writing, the LDO was priced at $2.04. According to CoinMarketCap, it has grown 6.11% in the last 24 hours.
