Lido V2 Upgrade May Soon Be Live, Pending On-chain Vote
The V2 upgrade will introduce withdrawals and a staking router to simplify the crypto on-ramp
mstanley/Shutterstock modified by Blockworks
Popular Ethereum liquid staking solution Lido will soon deploy its V2 upgrade, pending an on-chain vote that will go live on Friday.
This much-anticipated upgrade will enable withdrawals for ether (ETH), and introduce a staking router that is intended to simplify on-ramps. This will make it easier to run individual staking nodes on the network.
Over 6.5 million ETH is currently staked with Lido, and only after the V2 upgrade can this locked-up ETH be withdrawn from the network.
Withdrawal requests can be placed immediately after the upgrade and are expected to be finalized the following day, Eugene Mamin from the Lido development team wrote in a proposal.
Mamin notes that Lido will use a withdrawal vault to fulfill these requests. An estimated 270,000 ETH is currently in the vault, which is designed to streamline the validator exit process.
An initial snapshot vote saw that LDO holders overwhelmingly supported the upgrade plan, with 52 million LDO holders (almost 100% of voters) voting in favor of the proposal.
A series of security audits have also been conducted, where nine independent auditors have reviewed the V2 smart contract code, resolving issues related to withdrawals, claims, oracle reports, safety, consistency and NFT withdrawal.
A post-Shapella look at staking
Following the Shapella upgrade, staking yields have remained high, a report provided by Staked, a non-custodial staking provider and Kraken subsidiary, showed.
In fact, ETH staking demand too had seen a significant increase following the upgrade.
The report shows that ETH deposits had increased by more than 4x at the beginning of May compared to deposits just a week before the Shapella upgrade.
The month of March saw $600,000 worth of ETH staked, and this number increased to $750,000 in ETH just six days later.
Web3 startups such as the Lisk Foundation are also looking to move their bitcoin into ether where they see more opportunities to maintain “a sustainable long-term yield.”
Although they have plans to eventually stake ETH, this move will not be immediate, List’s co-founder Max Kordek tweeted.
Staked predicts that staking demand will steadily increase over the next year to year and a half, from around 15% today to over 20%-35%.
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- Empire: Crypto news and analysis to start your day.
- Forward Guidance: The intersection of crypto, macro and policy.
- 0xResearch: Alpha directly in your inbox.
- Lightspeed: All things Solana.
- The Drop: Apps, games, memes and more.
- Supply Shock: Bitcoin, bitcoin, bitcoin.
