Last Updated: March 2026
Lido is the largest liquid staking protocol in crypto, managing $15B+ in staked ETH. It lets anyone stake Ethereum without the 32 ETH minimum and receive stETH — a liquid derivative that can be used across DeFi while earning staking rewards.
History and Founders
Founded by Konstantin Lomashuk, Vasiliy Shapovalov, and Jordan Fish in 2020. Launched ahead of Ethereum’s transition to proof of stake when staked ETH was locked with no withdrawal date. Lido solved this by issuing stETH — tradeable immediately. Backed by a16z, Paradigm, and Dragonfly.
How Lido Works
- Deposit any amount of ETH into Lido
- Receive stETH (1:1 ratio) — a liquid token representing your staked ETH + accruing rewards
- stETH automatically rebases daily — your balance increases as staking rewards accrue (~3-4% APY)
- Use stETH in DeFi: lend on Aave, provide liquidity on Curve, restake on EigenLayer
See ETH staking guide, staking guide, and EigenLayer guide.
Tokenomics
LDO: 1B total supply. Governance token for Lido DAO. stETH: Liquid staking derivative (not a separate token — it IS staked ETH). Fee: 10% of staking rewards (split between node operators and DAO treasury). See tokenomics and DAO guide.
Why Lido Matters
- Dominant position: ~30% of all staked ETH goes through Lido
- stETH is money: The most integrated DeFi asset — accepted as collateral on Aave, Maker, and dozens of protocols. See Aave
- DeFi composability: Earn staking yield + DeFi yield simultaneously. See yield farming
Pros and Cons
- Pro: Largest liquid staking protocol with $15B+ TVL
- Pro: stETH is the most liquid and widely integrated LST
- Pro: No minimum — stake any amount of ETH
- Con: Centralization concern — ~30% of staked ETH in one protocol
- Con: LDO token value capture is limited (governance only)
- Con: stETH can trade at a discount during extreme market stress
Frequently Asked Questions
Is Lido safe?
Lido is the most audited and battle-tested staking protocol. stETH briefly traded at a 5% discount during the 2022 crisis but recovered. Smart contract risk exists but is minimal for established protocols. See security guide.
Is stETH the same as ETH?
stETH represents staked ETH and can be redeemed 1:1 for ETH (with a short queue). It also trades on DEXs near 1:1. It’s effectively ETH that earns yield.
