Lido Finance, an Ethereum 2.0 or Eth2 staking service provider, has raised $2 million in fresh funding.
Sharing the news exclusively with The Block on Monday, Lido said the round was backed by Semantic Ventures, ParaFi Capital, Terra, KR1, Stakefish, and Staking Facilities, among others. Angel investors, including Rune Christensen of MakerDAO, Stani Kulechov of Aave, and Kain Warwick of Synthetix, also participated in the round.
With fresh capital at hand, Lido looks to launch its mainnet this month. The protocol's testnet has been available on Ethereum Goerli since late November.
Lido is a "liquid" Eth2 staking protocol, meaning it allows users to unlock staked ether (ETH) and use it in various DeFi applications to earn yield. Lido does so by issuing its native token stETH for every ETH staked via its protocol. stETH is a tokenized version of staked ETH.
The service comes at a cost, of course. Lido will charge a 10% fee on staking rewards, according to information on its website. Top crypto exchanges are also set to provide Eth2 staking services, but Lido said its solution "does not rely on a single party's private key management."
ETH holders continue to stake their coins since the Eth2 deposit contract went live last month. The contract currently has around 1.5 million ETH, worth about $870 million, staked at the time of writing.