Lido deposits surpass $12 billion as Ethereum Shapella upgrade boosts liquid staking

Quick Take

  • Lido’s total value locked (TVL) surpassed 6 million ether (ETH), equivalent to around $12 billion, per DeFiLlama.
  • This comes after the launch of the Shapella upgrade, which is expected to boost growth for liquid staking market.

Liquid staking protocol Lido Finance has seen its total value locked (TVL) surpass 6 million ether (ETH), equivalent to more than $12 billion, days after the Shapella upgrade on Ethereum.

Since January, Lido's TVL has risen by over 20% from 5 million ETH, according to DeFiLama — a trend expected to persist beyond the Shapella upgrade. A total 141,000 users have deposited their ETH into Lido Finance, Nansen data shows.

Liquid staking, offered by Lido and other protocols, is a popular method that streamlines user deposits and stakes on Ethereum. Users receive a derivative token as proof of their deposit, which can be used as collateral within the DeFi ecosystem, enabling them to earn additional yields beyond what Ethereum staking alone provides.

The Shapella upgrade, enabled last week, allows for proof-of-stake withdrawals on the Ethereum network.

"Liquid staking is poised to benefit the most from the Ethereum Shapella upgrade. Liquid staked tokens offer greater capital efficiency and flexibility compared to staked tokens, as traders can earn staking rewards while retaining the ability to move their funds freely," said Charmyn Ho, Head of Crypto Insights at crypto exchange Bybit.

Shapella can boost liquid staking access on Ethereum

As the staking landscape evolves, an increasing number of users prefer staking providers over operating their own validator nodes.

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