Cryptoeconomics

News, data and analysis on tokenized assets, market design and digital economic systems.

Protocol

Lido

A liquid staking protocol on Ethereum: deposits are staked through curated and permissionless validator modules and represented by stETH, which accounts for close to a quarter of all staked ether.

Category Liquid staking
Home network Ethereum
Governance DAO with holder veto
Token LDO

The economic model

Lido takes a 10% fee on the consensus- and execution-layer rewards its validators earn, and splits it between node operators and the DAO treasury. The DAO's effective share is a governed variable, and it moved: from 4.96% in December 2025 to an all-time high of 6.10% in May 2026 after the curated module's economics were renegotiated, a 23% increase in take rate achieved without raising the fee depositors pay. Because the fee is a percentage of rewards, revenue is levered to both the ETH price and the network's issuance rate: the February 2026 update showed projected 2026 staking fee revenue falling from $45.3m to $33.4m when the assumed ETH price dropped from $2,712 to $2,020.

Stakers bear the operational risk. Validator penalties and slashing are socialised across the rebasing stETH balance, so a correlated client failure is felt by every holder rather than by the operator responsible; the curated module posts no capital bond, which means the loss-absorbing layer is the DAO treasury and, beyond it, depositors. Liquidity risk is the other exposure, and April 2026 tested it: the Kelp DAO exploit unwound leveraged staking positions and cut Lido's EarnETH product from 111,000 ETH to 58,000 ETH, though stETH secondary liquidity held. Market share has drifted down to about 23% of staked ETH as institutional entrants arrive, even as absolute deposits grew.

LDO is a governance token with no fee claim. All protocol fees flow to the DAO treasury, which stood at roughly $121m on 30 April 2026 after ETH price effects took $31.6m off its stETH holdings, and LDO holders decide how it is spent. Two mechanisms now point revenue at the token, both conditional. An accumulation programme deployed 471 stETH into LDO at an average price of $0.3745 in a first batch that closed on 29 May 2026. NEST, the automated successor approved by Snapshot with onchain deployment expected in July 2026, buys only when ETH trades above $3,000 and annual revenue exceeds $40m, sizes purchases as min(50% × (revenue − $40m), $10m), and splits the result equally between LDO buybacks and wstETH liquidity provision. A capped, threshold-triggered buyback is a weaker claim than a distribution, and it is worth saying so.

How it is governed

Lido DAO, where LDO holders vote on parameters, treasury and node operator sets, constrained by Dual Governance: stETH holders can delay or veto DAO decisions they judge harmful, which gives the depositor base a formal check on the tokenholder base. Validators are organised into a Curated module, a Simple DVT module and a permissionless Community Staking module.

Where it runs

Ethereum

The numbers

Each figure as published by the source named on the row. Protocol metrics are especially prone to double-counting; where a provider states a caveat, it is carried here.

MetricValue As ofSource
stETH total value locked $17.3bn 25 July 2026 Lido
ETH staked through Lido 9,300,000 25 July 2026 Lido
Share of staked ETH 23.00% 26 February 2026 Lido: Tokenholder update, February 2026
DAO take rate on staking rewards 6.10% 31 May 2026 Lido: Poolside recap: tokenholder update, May 2026
DAO treasury $121m 30 April 2026 Lido: Poolside recap: tokenholder update, May 2026

Reading protocol metrics

Value locked, fees and volume are computed differently by every provider, and the same activity often appears in two of them. We publish the provider's own figure with its method attached rather than reconciling the difference into a number nobody published.

Data and methods →

Sources

  1. Lido lido.fi · 25 Jul 2026
  2. Lido: Tokenholder update, February 2026 blog.lido.fi · 25 Jul 2026
  3. Lido: Poolside recap: tokenholder update, May 2026 blog.lido.fi · 25 Jul 2026
  4. DefiLlama: Lido defillama.com · 25 Jul 2026

Elsewhere

All protocols →

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