• Lido Finance (Lido) is the number one DeFi project with the highest Total Value Locked (TVL) of $7.92 billion.
• Staking APR on the platform has fallen consistently since May 2022.
• With Ethereum’s transition to a proof-of-stake consensus mechanism in September 2022, demand and usage of stETH, a tokenized version of staked Ether native to Lido, have increased significantly.
Lido Finance: Leading DeFi Project with Highest TVL
With a 16.77% market share of the $47.2 billion worth of crypto assets locked on several decentralized finance (DeFi) protocols, Lido Finance (Lido) retains its spot as the leading project with the highest total value locked (TVL). Displacing MakerDAO for the first time in January 2021, Lido has held onto its position and currently holds a TVL of $7.92 billion at press time.
Impact of Shanghai Upgrade for Ethereum Network
The confirmation of a March date for the Shanghai Upgrade for the Ethereum network might have contributed to a jump in the value of assets locked on Lido. According to blockchain analytics platform Nansen, staking solutions have been highly sought after since Ethereum’s transition to a proof-of-stake (PoS) consensus mechanism in September 2022 and this increase in demand has further solidified Lido’s position as the DeFi project with largest TVL.
State Of ETH Staking On Lido
As per data from Dune Analytics, Lido’s share of ETH staking market is 29.36%. Since May 2022 this percentage has oscillated between 29.25%-29.37%. This decrease in market share may be attributed to gradual reduction in annual percentage rate offered by Lido for ETH stakers which decreased from 10.21% on 14 November 2022 to 4.79% at present writing as per Dune Analytics data .
Revenue Growth On The Network
Revenue on the network continued to grow according to data from Token Terminal and is closely tied to Ethereum PoS earnings as Lido facilitates staking services like ETH 2 validator setup, delegation and rewards management amongst others .
Conclusion
Overall , despite witnessing reduced APR , LIDO remains at forefront among DeFi projects owing it’s popularity due increasing demand for yield generating services that are natively collateralized such as merge etc . Revenue growth and sustained increase in usage & demand for native tokens such as stETH will continue driving growth in TVL & market share over next few months .