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Lido’s Market Cap Is Surging After The Ethereum Upgrade

Key takeaways:

Derivative liquidity staking has managed to seize the attention of investors. The crypto liquid staking platforms have entered into a rally.  Lido (LDO) , the token that powers Lido DAO, is leading the bullish trend. The crypto investment option allows an investor to earn returns on their crypto assets without any lock-in period. 

These assets and their respective platforms will come under limelight as Ethereum’s Shanghai upgrade is scheduled to go live in March, 2023. Post the upgrade, staked Ethereum on the Beacon chain will be released. Ethereum merged with the proof of stake Beacon chain in November, 2022 while Beacon chain was launched in December 2021.  The staked Ethereum will not be released simultaneously owing to security concerns.

As per analysts, liquid staking platform are poised to benefit. These platforms offer better yields in comparison to ETH staked directly. Users who stake ETH via Lido receive daily yields in the form of staking derivative tokens which are pegged 1:1 to the underlying staked assets. The capital limitations are solved by the issuance of stETH, the tokenized version of staked ETH. This tokenized assets can be used by users in other protocols.

Additional Read: Ethereum Shanghai Upgrade Date

Liquid staking tokens have been rising since monday, Asia trading session zone. LDO has reached its highest level since mid-September. Lido (LDO) tops the chart with a blazing 30% surge. Furthermore, the governance token (Lido DAO) has doubled in value. It climbed from around one dollar to reach $2 a couple of hours ago. 

The same cannot be said for other crypto assets or even Ethereum, which has only managed 9% over the past week. There are almost 16 million ETH staked, and Lido has 4.8 million of that total. This gives the platform a commanding market share of 30%.The leading Ethereum staking platform had recorded an all time high of $9 in 2021. Currently, the token has a circulating market cap of $1.13 billion 

In line, the new chapter of liquid staking derivatives also includes other liquid staking derivative tokens such as StakeWise (SWISE) which rallied by 20% on a daily basis. 

Lido Derivatives sees an uptick | Source: CoinMarketCap

The market witnessed a surge in NFTs and DeFi leading markets in previous cycles, while 2023 could be the year for liquid staking platforms. 

Gainers in the crypto market

The crypto market entered the green zone on the market heatmap this morning in Asia trading time zone open. Total capitalization of crypto has reached a three-week high following a 3.2% gain on the day. The total cap is now sitting at $884 billion, having gained 6.7% since the beginning of the year.

Lido finance’s native token Lido ( LDO) is undoubtedly leading the crypto derivatives. In addition, other crypto assets are performing well with double-digit gains include Cardano (ADA), Solana (SOL), and ApeCoin (APE). Bitcoin has finally reclaimed $17,000, while Ethereum has topped $1,300 once again.

More about Lido (LDO) 

​​Users that want to stake through Lido, deposit their Ether into the Lido smart contract of  Ethereum 1.0. The user receives ETH in return, which is a tokenized version of Ether staked by Lido. Holders of stETH can use the token to participate in other decentralized protocols. ETH tokens are minted upon deposit and burned when withdrawn. Withdrawals of staked ether is currently not possible, but will be available once transfers and smart contracts are implemented on Ethereum 2.0 which will happen once the Shanghai upgrade is successfully completed. The deposited Ether is distributed between the node operators that are selected by the Lido DAO. Node operators run validator nodes on behalf of the protocol. The deposited ether are then locked into the Ethereum proof-of-stake deposit contract.

Read More: Lido (LDO) | Price Prediction

Source: Beincrypto

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