Could Lido Finance [LDO] be the biggest gainer amid staking crisis speculation

Could Lido Finance [LDO] be the biggest gainer amid staking crisis speculation

February 10, 2023

By Suzuki Shillsalot

Realistic or not, here’s LDO’s market cap in ETH’s terms

The LDO token went against the crypto market trend after staking ban speculation emerged.

Not many investors held LDO in non-custodial wallets as exchange inflow skyrocketed.

The Lido Finance [LDO] price increased against the broader market sentiment after Coinbase CEO Brian Armstrong raised an alarm about a possible crypto staking ban. But why has Lido gained after speculation of a potential prohibition?

Complete decentralization to take home the prize?

Well, the difference between staking on Ethereum [ETH] and Lido Finance is that the latter’s staking procedure is decentralized in nature. Ethereum, on the other hand, is subject to oversight from regulators.

At the time of writing, the token of the liquid-staking protocol increased by 5.50%. Although the LDO price increased, the Lido share per the staked Ether [stETH] did not significantly go up. According to Dune Analytics, the LDO share had decreased to 29 at press time.

However, the total LDO deposited into the pool was on a continual increase. At the time of writing, about 4.82 million LDO had flowed into the staking pool as revealed by the image above.

This means that more users have increased chances of becoming Ethereum validators and also earning a yield. Besides that, Lido Finance’s sustenance of the DeFi Total Value (TVL) locked top spot, coupled with the recent development might have earned it increased attention.

DeFiLlama, the TVL aggregator, showed that the Lido Finance TVL was $8.47 billion. However, the TVL despite staying above erstwhile leader MakerDAO [MKR] had decreased by 2.10% in the last 24 hours. This explains how investors have resisted putting more liquidity into protocols under the chain.