Staking Behemoth Lido Intends to Fetch Services to Solana
One of the biggest ETH 2.0 and Terra staking facilities is now considering the possibility of expanding to other proof-of-stake chains, beginning with first layer 1 Solana. In a suggestion given on Lido’s governance forums, crypto framework provider Chorus One formulated a strategy to develop “a liquid staking token (for now: stSOL) that will accrue staking rewards and represent staking positions with Lido validators on Solana,” comparable to Lido’s prevailing interest-accruing stETH crypto token.
Lido Ecosystem Grants Organization, a funding program started by Lido’s governance in March, will provide the necessary financial assistance to bring Lido’s services to an additional chain.
Chorus One’s called for a compensation bundle that includes 2,000,000 staked LDO tokens and a revenue distribution model that would guarantee Chorus One to 20% of the revenue from covenant fees that would be remitted to the Lido treasury.
The milestones of Chorus One’s staking plans are notable, including a one-year aim to “capture 2.5% of the staked SOL supply,” and also 1,000,000 tokens planned to be put under a one-year staking schedule “when Lido for Solana manages to capture 25% of the staked SOL supply.”
The suggestion indicates that Chorus One is presently the biggest SOL staker with tokens worth $600 million. A media outlet for Lido stated that an expansion could likely pave way for an increase in the covenant’s income.
The media spokesperson stated:
“For the Lido DAO, an expansion to liquid staking on Solana could bring with it a similar protocol fee set-up as we’re currently seeing with stETH/liquid staking on Ethereum, whereby a 10% fee on staking rewards is collected and split between node operators and the Lido DAO treasury (e.g. to grow an insurance fund).”
The spokesperson also pointed out that they are willing to consider rest of the Proof of Stake chains.
Lido representative said “Lido has a very simple mission – keep Ethereum staking simple, secure and decentralised – and we will look to extend this to other networks where possible.”
According to Lido’s webpage, the services presently accounts for 256,964 ETH staked (valued more than $700 billion) using roughly 5000 addresses, yielding 7.1% APY and is the third biggest staking pool presently active as per Nansen. Even though assessment varies, following the launch of ETH 2.0, the APY rewards are anticipated to rise considerably.
Lido’s $LDO token has been surging in recent times, with over 50% appreciation in the last 24 hours to trade at $2.75%, and 215% gain in a week, an uptrend sparked by another governance suggestion that would spread the treasury portfolio risk to another bunch of prominent venture capital funds such as Digital Currency Group, Delphi Digital, Alameda Research and Three Arrows Capital.