Lido to sunset staking on Polkadot, Kusama by August Lido to sunset staking on Polkadot, Kusama by August
Lido developer MixBytes said Polkadot's DeFi lack of liquidity undermined the value proposition of liquid staking.
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Updated: Mar. 29, 2023 at 1:37 pm UTC
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Liquid staking protocol Lido (LDO) said it would stop providing staking services for Polkadot (DOT) and Kusama (KSM) on Aug. 1.
According to a blog post by Lido developer MixBytes, the decision was made “because of several challenges, including market conditions, protocol growth, limited capacity, and priority alignment.”
The developers further clarified that balancing its Ethereum staking services with Polkadot and Kusama was a challenge. It noted that “the balance of priorities often leaned towards Ethereum first [before other networks].”
“Challenged macro economic factors and adjacent lack of liquidity in Polkadot’s DeFi ecosystem undermined the value proposition of liquid staking.”
Meanwhile, Lido still provides staking services for networks like Polygon (MATIC) and Solana (SOL).
Lido not accepting new staking deposits for Polkadot, Kusama
The staking protocol said it stopped accepting new staking deposits for Polkadot and Kusama on March 15. It added:
“Existing stDOT and stKSM holders continue to receive rewards, and have the ability to unbond stKSM/DOT to claim xcKSM/DOT directly from the Lido UI, and wrap or unwrap their tokens.”
However, issuance and redemptions would be halted on June 15, and all assets would be automatically unstaked on June 22, according to its timeline.
Meanwhile, Mixbytes noted that it received an influx of interest from the community who have proposed a new DotSama LST protocol to be operated by a newly formed DAO. According to the firm, it is evaluating the possibility of supporting a dedicated DotSama native liquid staking solution technically.
According to Lido’s website, there are over 3.5 million staked DOT on its platform with a market cap of $20.6 million, while 43,201 KSM tokens have been staked with a market cap of $1.5 million.
Disclaimer: CryptoSlate has received a grant from the Polkadot Foundation to produce content about the Polkadot ecosystem. While the Foundation supports our coverage, we maintain full editorial independence and control over the content we publish.
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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