ETH staking giant Lido to implement withdrawal function in V2

ETH staking giant Lido to implement withdrawal function in V2

Full release of Lido V2

Lido Finance (LDO), the largest liquid staking protocol, today announced plans for its next upgrade, Lido V2.

Implementation of withdrawal function of crypto asset (virtual currency) Ethereum (ETH) and important function update for network decentralization are planned.

Ethereum plans to implement a large-scale upgrade “Shanghai” from March to April 2023. At the time of writing, 16.35 million ETH (equivalent to approximately 3.6 trillion yen) locked up in the staking contract and staking rewards will be available for withdrawal for the first time.

Lido is the leading provider of “liquid staking” that manages alternative assets (stETH) while receiving Ethereum staking rewards. It accounts for (29%: 4.83 million ETH) of the total number of Ethereum stakes.

The ETH withdrawal method proposed by Lido is the default setting “turbo” mode, which allows for the fastest withdrawal, and the “bunker” mode, which is activated in an emergency when a large number of slashes (ETH2.0 penalty) occur. There is

In the future, once the LidoDAO (Decentralized Autonomous Organization) passes this proposal, users will be able to unstake their stETH and receive ETH at a 1:1 ratio. The schedule for community voting and implementation of the withdrawal function will be optimized based on the progress of Ethereum’s Shanghai upgrade.

connection:Lido ETH withdrawal method to be voted for Shanghai

Implementing a staking router

Another highlight of Lido V2 is the implementation of a “staking router”.

Lido was originally launched in collaboration with the industry’s leading staking providers, and the protocol has 27 node operators (for ETH Lido) as of the end of Q3 2022. Additionally, the addition and removal of node operators has been managed through submissions to the LidoDAO and community voting.

According to Hasu (pseudonym), Flashbots strategy lead and research collaborator at Paradigm, the staking router provides external validator pools with a modularized infrastructure to become Lido node operators.

This will make it easier for new independent node operators such as solo stakers, DAOs (Decentralized Autonomous Organizations) and Decentralized Validator Technology (DVT) to join the Lido protocol.

DVT, in particular, is a game-changing technology for the ETH validator space, as it is a means of distributing the role of a validator across multiple nodes instead of a single machine, making it more resistant to regulatory censorship.

In short, staking routers have the advantage of making the Lido protocol more decentralized and making the network more secure for end-users who stake ETH. The decentralization of Lido, which accounts for 29% of the staking share, is also seen as positive in terms of risk mitigation for Ethereum.

connection:Ethereum Foundation warns of risks liquidity staking poses to ETH

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Written by: Kurt Ebenzer


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