- The Lido board continued to make new plans for the future as the protocol grew.
- The Lido Protocol has been criticized for its recent validator reduction.
In the ever-evolving world of the Liquid Staking Derivative sector, Lido[LDO] managed to shine despite the turbulent nature of the market. This makes it a prominent figure in this fast-growing space.
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New plans in action
However, the growth story has not stopped Lido’s board from advancing its vision for the protocol. Under the banner of the Guided Open Objective Setting Exercise (GOOSE), key stakeholders shared their insights on how Lido’s board should navigate the way forward.
One of the future plans for Lido is to develop complementary products such as redraw, DVT, wallets, stablecoins, loans and other applications that interact with stakers, sETH or NOs. The role of the board is to decide which of these can be beneficial for development and use, and which should be overlooked.
According to proponents, any new features considered for implementation should align with the primary or secondary objectives without undermining the primary objectives. For example, DVT improves safety with only a marginal effect on rewards, making it a core capability that the DAO should focus on. While resuming provides higher rewards, it also poses a trade-off in terms of safety and requires robust risk mitigation.
However, it is worth recognizing that despite its success and promising future, Lido has not remained immune to criticism. The protocol faced significant backlash when twenty Lido validators faced budget cuts. The Ethereum protocol imposed this punitive measure.
Fame and criticism go hand in hand
This incident that occurred on October 11 affected twenty Lido validators operated by two professional blockchain infrastructure providers. Infrastructure and problems were the main causes. This incident resulted in a fine of 23.06 ETH, approximately $35,000, which represents 2.25% of the average daily rewards earned by Lido validators.
The penalty amount was immediately returned to Lido Protocol to compensate stake ETH holders for their lower daily rewards. This wasn’t the first time Lido validators had to deal with cuts. In April 2023, 11 RockLogic GmbH validators were also sanctioned. The fines amounted to almost 14 ETH, which at the time was equivalent to about 2.4% of daily Lido rewards.
Realistic or not, here is the market cap of LDO in terms of BTC
These issues can impact sentiment around both the protocol and the token. However, at the time of writing, LDO weighted sentiment was in a slightly positive position. This showed that the positive reactions were greater than the number of negative reactions around Lido.
Source: Santiment
