Liquid Staking On The Rise

As of June 11, 2023, Ethereum dropped from a high of $4,400 in December 2021 to the current price of $1,750, down 60% . During this drawdown, the units of ETH deposited staked through liquid staking token (LST) protocols increased from 1.7M to 8M, up 470%. The long term holders aren’t simply deciding to hold ETH, rather they are opting for a staked version of ETH which pays yield in ETH.

The product of choice for large ETH holders is liquid staked ETH - for native yield and ability to lend through decentralized financial (DeFi) protocols. The current state of liquid staking products are flawed, prioritizing liquidity of the one LST above the decentralization of the crypto network on which it operates.

Lido controls 32% of all staked ETH, resulting in 32% of all network influence.

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