Lido to End Services at Polygon

Lido Finance has announced the discontinuation of its operations on the Polygon network, citing limited user adoption, evolving DeFi dynamics, and a strategic shift to its primary focus on Ethereum.

In a blog post on December 16, the Lido team confirmed that the decision was made after extensive discussions within the Lido DAO, a community vote, and overwhelming support from LDO token holders, with 99% in favor of the proposal.

The team highlighted challenges at Polygon, including high maintenance demands, insufficient rewards, and the DeFi ecosystem’s increasing shift towards zkEVM solutions.

The team noted:

“This transition has led to reduced demand for liquid staking solutions on Polygon POS, impacting the potential of Lido on Polygon as a fundamental building block of DeFi.”

They added:

“Furthermore, alternative liquid staking solutions were built within an ecosystem that turned out to be smaller than initially anticipated.”

Shard Labs, which introduced the Lido staking service on Polygon in 2021, has noted declining demand for PoS staking on Polygon amid a broader migration to zkEVM.

As of December 16, new staking requests on Polygon have been halted, although users can still withdraw their staked MATIC via the Lido interface until June 16, 2025.

Deadlines

Key dates that stMATIC holders should keep in mind are:

• December 16, 2024: Staking on Lido for Polygon will be discontinued.

• December 16, 2024 – June 16, 2025: Transition period: Withdrawals can be processed through the Lido interface on Polygon.

• January 15-22, 2025:…

Staking rewards have been discontinued, and withdrawals will be temporarily paused from January 15th to January 22nd, 2024.

After June 16th, front-end support will be terminated, and withdrawals will only be accessible via browser tools.

Lido First Halted Operations on Solana, Now on Polygon

Last year, Lido announced its decision to discontinue operations on the Solana blockchain following a community vote, citing unsustainable finances and low fee structures.

Lido's presence on Solana began on September 8, 2021, but challenges in maintaining profitability eventually led to its exit from the protocol.

1/ When @LidoFinance joined @Solana in 2021, many asked how a community-funded project with no VC funding, like @MarinadeFinance, could stand a chance. Now that Lido has announced the closure of its operations on Solana, it’s time to share the untold story 🧵👇 pic.twitter.com/oFQnuYQ79s

— repe (@repetny) November 15, 2023

Similarly, Aave, one of the leading lending protocols on Polygon, has proposed discontinuing its operations on the network due to concerns surrounding the risk profile of pegged assets ahead of an impending review.