Ethereum liquid staking platform Lido announced a big upgrade earlier this month. Since then, its native token, LDO, has surged 33% in value, but what is driving it?
Momentum keeps building for Lido liquid staking as more ETH gets piled onto the platform. The team behind the world’s largest decentralized liquid staking network announced a major upgrade earlier this month.
Furthermore, this has driven LDO prices 33% higher to reach a ten-month high on Sunday, Feb. 19.
On Feb. 20, Token Unlocked detailed the upgrade and the momentum behind the big LDO pump. It said that the V2 upgrade announcement was not the only news affecting LDO prices.
Lido Liquid Staking V2
The U.S. Securities and Exchange Commission (SEC) is cracking down on staking services, claiming they break federal securities laws.
This has been a cause of concern among stakers who have their assets staked with centralized exchanges like Coinbase. Earlier this month, American exchange Kraken was fined and forced to shutter its staking services so more U.S. exchanges could be targeted.
This has led crypto investors to “consider moving to decentralized finance platforms such as Lido Finance, which has recently gained popularity,” said Token Unlocks.
Lido currently has 5.1 million ETH staked worth around $8.7 billion. Furthermore, this represents roughly 30.5% of the entire staked quantity of ETH.
Furthermore, the V2 upgrade has two main features. A Staking Router is a new modular architectural design that benefits all network participants including stakers, node operators, and developers. Lido explained:
“The Staking Router is a key milestone towards the goal of fostering the best validator set for Ethereum – one which doesn’t compromise on either quality, security or decentralization.”
The second main feature is an upgrade to withdrawal functionality with two modes. A ‘Turbo mode’ enables Lido to take ETH from the staked pool to give to those wanting to unstake stETH. The process should take just a couple of hours.
The ‘Bunker mode’ increases the withdrawal time in the case of emergencies to preserve network security. These modes will come into effect after the Ethereum Shanghai upgrade in late March.
LDO Price Retreats
LDO prices have taken a hit today as the crypto market cools following recent gains. As a result, LDO dropped 5.5% on the day, falling back to $3.03 at the time of press.
Over the weekend, LDO briefly touched $3.30, its highest price since April 2022. Furthermore, the liquid staking governance token has made a whopping 48% over the past two weeks.
However, the LDO price is still down 58.5% from its peak price of $7.30 in August 2021.
Disclaimer
All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
