Decrypting DeFi is Decrypt's DeFi email newsletter. (art: Grant Kempster)

Liquid staking giant Lido Finance is finally looking to shake up its tokenomics.

Specifically, as alluded to in a new proposal, members of the community are looking to add a staking feature to LDO.

Remember: In order to stake directly to the mainnet, users need 32 ETH or nearly $60,000 at today’s prices. Given the high barrier to entry, liquid staking services like Lido have emerged, letting users deposit any amount of ETH and begin earning.

Watching this proposal develop will be a top priority for many in the space. Lido is, after all, the largest DeFi project with a whopping TVL of nearly $12 billion.

Coinbase Pauses Ethereum Staking Reward Withdrawals for Up to Three Days

The proposal is still in its very early stages, but here’s the pitch in a nutshell:

LDO holders would be able to stake those tokens and begin earning rewards drawn from the protocol’s revenue. Lido currently generates revenue by charging users a 10% fee on those rewards. Half of that goes to the project’s DAO and the other half goes to various node operators that execute the actual mainnet staking.

This new proposal specifies that, if passed, stakers would earn between 20% and 50% of the Lido DAOs revenue. Basically, up to half of that 5% service fee. And this would be executed via buybacks, in which generated revenue would be used to buy more LDO tokens (and distributed).

But it’s not free money. For that extra bit of yield, LDO stakers also become the “insurance providers of last resort,” the proposal reads.

Should the project’s insurance fund get drained due to a hypothetical mass-slashing event, up to 30% of LDO stakers’ funds would be next on the chopping block.

Eigen What? How EigenLayer Is Putting $34B in Staked Ethereum Back to Work

Slashing refers to the penalty that Ethereum validators would face should they suffer any downtime or begin validating fraudulent transactions on the network. Remember the 32 ETH needed to deposit to join the network? Slashing takes some of that deposit from the validator.

Lido has, however, made assurances that such an event is “unlikely to happen given the quality of the Lido validator set and its proven track record.” Still, it’s a risk.

As to how the proposal is being received by token holders, it’s a bit of a mixed bag, ranging from its “a ponzi scheme” to “finally something useful for LDO.”

It’s also not super unique.

Aave, for example, does precisely this via its safety module. AAVE holders can stake their tokens, earn extra yield, but also bear a similar slashing risk should the lending platform face a bad debt situation.

Given the community's general take on the proposal, we're likely to see a new draft soon.

It's a good first attempt at adding a bit more utility to what's essentially just a voting token after all.

Decrypting DeFi is our DeFi newsletter, led by this essay.

#lido #lidodao #staking

Lido is considering a new proposal to use its ARB airdrop to enhance activity on Arbitrum.

The proposal would see Lido accept its $1.2 million in ARB tokens and reward them to liquidity providers in wstETH pools.

It could go to a vote later this week, and the result will have a bearing on LDO and ARB prices.

The Lido DAO community is set to vote on operational and strategic topics concerning how to claim and make valuable use of ARB tokens. More specifically, the vote will determine whether to accept Arbitrum’s airdrop and if the claimed ARB tokens could serve as emission rewards for incentivizing the adoption of wrapped staked Ether (wstETH) across the Arbitrum network.

In response to this airdrop, the Lido DAO rewards committee puts forward the following proposal. This proposal covers operational and strategic topics related to claiming and making productive use of the potential ARB tokens. This proposal will enable the rewards committee to pursue the continued growth of staking and the wstETH DeFi ecosystem on Arbitrum One (and beyond).

Lido’s Operational and strategic topics

Justin David Reyes, Lido’s head of decentralized finance (DeFi) business development and partnerships, submitted the proposal that precedes the vote on April 12. In his submission, Reyes suggested that liquidity providers (LPs) for the wstETH pools on Arbitrum be rewarded with ARB tokens.

According to marketing lead Kasper Rasmussen, the incentives program would operate similarly to how liquidity pools currently earn extra LDO rewards in addition to staking rewards, adding that the vote could take place within the week.

Lido to claim hundreds of thousands of ARB tokens

The deliberation comes almost a month after Arbitrum’s airdrop for its governance token, ARB, went live. The launch saw early adopters of the layer 2 (L2) scaling solution enjoy lucrative rewards, including some decentralized autonomous organizations (DAO) such as Lido, which played an enabling role in the growth and success of Arbitrum.

As a component of that airdrop, the Arbitrum Foundation has expressed that they are allocating a portion of the governance, via the ARB governance token, to communities that have played a role in the growth and health of the Arbitrum ecosystem.

A Google doc within Arbitrum Foundation’s governance documents reveals that Lido is entitled to claim up to 772,621 ARB tokens, translating to over $1.2 million at prevailing rates. Further, the proposal notes that 33,400 wrapped staked Ether has already been bridged to the Arbitrum ecosystem, with the cumulative number of wstETH transactions on Arbitrum now reaching over one million.

Based on the governance documentation, there are no specific conditions on the distribution of the said tokens, which leaves it in the hands of the Lido DAO network to determine how best to use the tokens in participating in the governance and growth of the Arbitrum ecosystem.

Possible impact of vote outcome on LDO and ARB prices

Meanwhile, Lido price (LDO) and Arbitrum price (ARB) are still experiencing a lack of directional bias and have been consolidating under formidable zones for weeks.

The outcome of the vote could catalyze a possible breakout for both Layer 2 tokens. For Lido price, a positive outcome could see LDO breach the immediate barricade at $2.63 and clear the path for a potential climb of around 15% to the next roadblock of around $2.92. The L2 token could tag the $3.27 hurdle in a highly bullish case, denoting a 30% upswing.

Regarding Arbitrum price, passing the proposal could restore ARBabove the $1.70 resistance level, paving the way for the altcoin to reclaim its local high of around $1.80. Such a move would constitute an uptick of about 10% from current levels.

Conversely, failure to pass the proposal could see Lido price drop toward the $1.96 swing low before a possible pullback. On the other hand, Arbitrum price could lose the critical support at $1.59, exposing the L2 token to a cliff that could send ARB down around 10% to $1.50.

#lido #arbitrum #arb #Binance #BullRun

Lido Dao price shifts away from $2.20 with less upside potential in sight.

LDO nears the oversold barrier in RSI again.

Only one element stands in the way of LDO imploding.

Lido Dao (LDO) is in the red and sending out distress signals as a new low was printed early Tuesday. Support is nearby, although it is questionable based on the current pattern  whether bulls will be there to support it. If the important 200-day Simple Moving Average (SMA) gives way, it will take many Hail Marys to avoid a systemic meltdown in the price action that could add up to the price being cut in half.

Lido Dao price playing with fire as a meltdown is near

Lido Dao price action on Tuesday morning can be compared with the Armageddon or doomsday pictures you often see in comic sitcoms where persons on the street shout: "All is lost! All is lost!" It must feel like that for bulls at the moment as suddenly a lot of them find themselves stuck in a negative position with the risk that that negative number could start to double or even triple. LDO is flirting with the break of the 200-day SMA, opening up a two–tiered area where losses might vary from 25% to 50%.

LDO has one small circuit breaker at $1.85 that could still do the trick if the 200-day SMA does not hold. Once that $1.85 treads water, expect to see another leg lower of 25% toward $1.43. Conveniently, the new pivots for May almost falls in line with that barrier. In case that does not hold, a big gap opens up that will LDO below $1 with $0.87 as the best guess for support going back to the autumn of 2022.

A bounce at either first barrier would be enough to send LDO back above $2 and would make sense with the RSI being oversold again. There is little incentive for bears to get involved here if no breakout has occurred just yet to the downside. On the topside, that $2.20 will prove to be a firm test, and the 55-day SMA is coming in near $2.32 just above. 

#lido #Binance #BTC #crypto2023 #DAO

Lido DAO price shows a head-and-shoulders setup forming on the three-day chart,

A three-day candlestick close below $2.00 will trigger a 38% crash to $1.25.

Invalidation of the bearish thesis will occur if LDO produces a three-day candlestick close above $2.62. 

Lido DAO (LDO) price shows a clear formation of a top reversal set up on the three-day charts. The LDO token is hovering dangerously close to a breakout level that opens the floodgate of selling pressure. 

LidoDAO price reveals a pessimistic outlook

Lido DAO (LDO) price has formed a head-and-shoulders setup on the three-day chart. The pattern that spans all the way up to January 2023 contains three distinctive peaks. The central one is termed the head, while the ones on either side are named shoulders and are of relatively equal heights. The valleys of the three peaks can be connected using trend lines to reveal a horizontal support level known as the neckline.

A decisive break of this neckline will trigger a bearish descent, The setup’s target is obtained by adding the distance between the head’s peak and the neckline to the breakout point at $2.04 to reveal the target of $1.25.

If the ongoing bearish outlook continues for the crypto ecosystem, Lido DAO (LDO) price is likely to slide below the neckline at $2.04. In such a case, investors need to observe the $1.67 and $1.54 levels for support. A breakdown of these two support structures would send LDO to the theoretical target of $1.25.

Regardless of the bearish outlook, if Bitcoin dominance declines, it will allow altcoins, include LidoDAO price, to recover. In such a case, if LDO produces a three-day candlestick close above $2.62, it will invalidate the head-and-shoulders setup.

This development could see Lido DAO (LDO) price rally 26% and tag the head’s peak at $3.33.

#Binance #crypto2023 #lido #LDO #keepbuilding

Are you tired of trading futures day and night, keeping an eye on the market for meager profits? Here is a solution to help you earn stable income - the LIDO protocol. #lido $LDO

🦁️What is the LIDO protocol

The LIDO protocol is a decentralized lending protocol based on blockchain technology, with the full name 'Lendroid Support Protocol'. Its goal is to provide digital currency holders and exchanges with a more flexible and low-cost lending service, while protecting the interests of borrowers and lenders.

The L IDO protocol utilizes smart contracts to implement functions such as borrowing, lending, collateralization, and liquidation. It ensures security and transparency by introducing distributed storage and digital identity recognition technology. Users can use various digital assets as collateral for loans without the need for credit ratings

The LIDO protocol also adopts a unique approach to handle liquidation issues. It utilizes community members to manage the liquidation process to ensure fairness and transparency. In addition, the LDO protocol introduces incentives such as LDO token rewards and fee reductions to attract more users to participate in the platform

☁️How LIDO Helps People Make Money

The LIDO protocol provides multiple ways for users to make money:

Lending interest: Users can earn interest by lending digital assets on the LDO platform, and there is no minimum collateral requirement. At the same time, the issue of high gas fees on the Ethereum network has also been well resolved, enabling users to engage in lending operations at lower costs.

Stablecoin trading: Users can use the LDO protocol as a stablecoin trading platform and earn profits during the trading process. Stablecoin trading typically has lower risks and volatility, thus being relatively stable in the market. Users can earn certain profits through this approach.

Community participation: The LDO protocol encourages users to actively participate in community activities such as developer challenges, governance proposal voting, etc. Community members can also earn profits through token rewards and dividends

🌟How to use the LIDO protocol

To use the LIDO protocol, you need to follow some basic steps:

First, you need to access the LIDO platform, register an account, and create a digital wallet. You can use any Ethereum-supported digital wallet to connect to the LIDO platform.

After connecting to the LIDO platform, you need to deposit digital assets into your wallet and use them as collateral to lend other digital assets. You can also choose to borrow digital assets in exchange for collateral.

When conducting lending operations, you need to read and agree to the terms and conditions of the LIDO protocol. These terms include how to handle collateral, lending rates, liquidation processes, etc.

Once you have conducted lending operations, you can earn profits through the LDO protocol. For example, if you are a lender, you can earn profits from the interest paid by borrowers. If you are a borrower, you need to repay on time to avoid penalties.

With the above solution in mind, take action and pledge your ETH to earn your first million steadily.

Bitcoin price analysis

The long tail on Bitcoin’s May 12 candlestick shows that the bulls are aggressively buying the dips to the neckline of the inverse head and shoulders (H&S) pattern.

Buyers will try to push the price back into the triangle but may face stiff resistance from the bears. The downsloping 20-day exponential moving average ($27,959) and the relative strength index (RSI) below 41 indicate that bears have a slight edge.

If the price turns down from the 20-day EMA, the bears will again attempt to sink the BTC/USDT pair below $25,250. If they can pull it off, the selling may intensify and the pair could crash to $20,000.

On the upside, the bulls will have to clear the hurdle at the resistance line to regain control. The pair may then retest the overhead resistance at $31,000.

After facing stiff resistance at the 20-EMA, the bulls have cleared the obstacle. This indicates that the bulls are trying to seize control. The pair may first climb to the 50-simple moving average and then to $28,400.

On the contrary, if the price turns down sharply from the current level, it will suggest that the bears are trying to flip the support line of the triangle into resistance. The pair may then plunge to the crucial support at $25,250.

Cardano price analysis

Cardano’s (ADA) solid rebound off the uptrend line on May 11 suggests that lower levels continue to attract strong buying.

The bulls will try to resume the recovery by propelling the price to the 20-day EMA ($0.38). This level may act as a minor barrier but if bulls overcome it, the ADA/USDT pair could soar toward the neckline of the inverse H&S pattern. This level is likely to witness a tough battle between the bulls and the bears.

Another possibility is that the price turns down from the 20-day EMA and drops to the uptrend line. The repeated retest of a support level at short intervals tends to weaken it. That may open the doors for a potential fall to $0.30.

The bulls pushed the price above the moving averages, indicating that the bears may be losing their grip. The 20-EMA has started to turn up gradually and the RSI is in the positive zone, indicating that the bulls are on a comeback.

If buyers pierce the overhead resistance at $0.37, the pair could pick up momentum and rally to $0.40 and later to $0.42. Conversely, if the price turns down from $0.37, the pair may slide to the uptrend line.

Cosmos price analysis

Cosmos (ATOM) snapped back from the $10.20 support on May 10, indicating that the bulls are buying the dips to this level.

The bears are trying to halt the relief rally at the 50-day SMA ($11.28) but the bulls have not given up much ground. This enhances the prospects of a rally above the 50-day SMA. If that happens, the ATOM/USDT pair could rally to the downtrend line.

This is an important level for the sellers to guard because a break above it will invalidate the bearish descending triangle pattern.

The critical support to watch on the downside is $10.20. If it cracks, the descending triangle will complete and the pair may then plummet to $8.50.

The 4-hour chart shows that the relief rally is facing selling at higher levels but the price action is forming a possible inverse H&S pattern that will complete on a break and close above $11.30. The pair may then start an up-move to $12 and subsequently to $12.50.

Alternatively, if the price turns down and breaks below the 50-SMA, it will suggest that the bears are in control. The pair may then slump toward the vital support at $10.20. A bounce off this level could keep the pair inside the boundaries of $11.30 and $10.20 for a while longer.

Related: 4 alarming charts for Bitcoin bulls as $27K becomes formidable hurdle

Lido DAO price analysis

Lido Dao (LDO) rebounded off the $1.60 support and has reached the overhead resistance at the 20-day EMA ($1.95).

The bears are trying to protect the 20-day EMA but the bulls have not given up. This suggests that the buyers expect the recovery to continue. If bulls drive the price above the 20-day EMA, the LDO/USDT pair could rally to the downtrend line. This level is likely to attract strong selling by the bears.

If buyers arrest the next decline above the 20-day EMA, it will suggest a change in sentiment from selling on rallies to buying on dips. The pair could then start a sustained recovery above the downtrend line.

On the downside, the bears will have to sink and sustain the price below $1.60 to indicate the resumption of the downtrend.

The 4-hour chart shows that the bulls are trying to propel the price above the overhead resistance at $1.98. If they succeed, the pair will complete a bullish double bottom pattern. This reversal setup has a target objective of $2.39. If this level is also crossed, the pair may reach $2.60.

Contrarily, if the price turns down from the current level or $1.98 and breaks below the moving averages, it will suggest that bears are active at higher levels. That may keep the pair stuck between $1.57 and $1.98 for some time.

Arbitrum price analysis

Arbitrum (ARB) has been finding support near the psychologically important level of $1, indicating that the bulls are aggressively buying the dips.

On the upside, the bears have been attempting to stall the recovery at $1.20 but a minor positive in favor of the bulls is that they have kept up the buying pressure. That increases the likelihood of a break above $1.20. If that happens, the ARB/USDT pair could rise to $1.40 and later to $1.50.

This positive view will invalidate in the near term if the price turns down sharply from $1.20. That will point to a possible consolidation between $1 and $1.20 for a few days.

The 20-EMA on the 4-hour chart has started to turn up and the RSI is in the positive territory indicating that the selling pressure is reducing. Buyers will try to strengthen their position by pushing the pair above $1.20. If they do that, the pair will complete a double bottom pattern, which has a target objective of $1.35.

The first sign of strength for the bears will be a break and close below the 20-EMA. That could pull the pair to $1.05. A slide below $1 will signal the resumption of the downtrend.

#BTC #ada #cosmos #lido #arbitrum