Liquid staking reshapes Ethereum supply dynamics 📈
- Liquid staking projects, like Lido, allow users to delegate their ETH for staking while receiving Liquid Staking Tokens (LSTs) in return.
- Currently, 23% of ETH supply is staked, with 32% of that being staked via Lido, leading to a rise in stETH adoption.
- Liquid staking derivatives enable users to reuse their staked ETH in DeFi protocols while still receiving staking rewards.
- Lido dominates the liquid staking market with an 86% share, and its stETH has become the preferred asset on lending platforms like Aave.
- However, the shift from decentralized exchanges to lending platforms may pose risks in terms of stETH depegging and bad debt on Aave.
- Liquid staking projects, like Lido, allow users to delegate their ETH for staking while receiving Liquid Staking Tokens (LSTs) in return.
- Currently, 23% of ETH supply is staked, with 32% of that being staked via Lido, leading to a rise in stETH adoption.
- Liquid staking derivatives enable users to reuse their staked ETH in DeFi protocols while still receiving staking rewards.
- Lido dominates the liquid staking market with an 86% share, and its stETH has become the preferred asset on lending platforms like Aave.
- However, the shift from decentralized exchanges to lending platforms may pose risks in terms of stETH depegging and bad debt on Aave.