Lido Protocol Does Eth 2.0 Staking but With a DeFi Twist

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There’s a decentralized autonomous organization (DAO) that lets ETH holders back Ethereum 2.0 without losing liquidity, and it wants to give its participants a vote.

Until Feb. 12, ETH holders have a chance to earn some of the governance token for Lido, a new decentralized finance (DeFi) and staking protocol. There will be other opportunities in the future, but it’s up to LDO holders to decide when.

Since Tuesday, the amount of ETH staked on Lido has more than doubled, breaking 60,000 ETH as of this writing.

Lido sits at Ethereum’s sweet spot, putting the road to Eth 2.0 into DeFi. It gives people a fresh way to contribute ETH to staking on Ethereum’s new beacon chain but still unlock the value of their ETH. It’s one of those stories that somewhat strains credulity, very much an only-in-DeFi kind of scenario. So far it’s working.

Kraken has already rolled out a similar product and Coinbase plans to, but those lack the element of distributed trust.

An early backer of Lido and a member of its DAO, Aave’s Stani Kulechov, told CoinDesk over Telegram, “Tokenized staking ETH is interesting, because you can use the tokenized staked ETH as collateral (for example in Aave) and get more liquidity in ETH so you can leverage quite a lot in Eth 2.0 staking, I’m curious to see how much leverage there will be in staking.”

Additionally, Lido has a governance token but it’s taking a unique approach to distributing it. 

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