As the price of Ethereum (ETH) rises, we have been seeing rapid recoveries in the altcoins in its ecosystem. LDO Coin was one of them. Lido DAO, the most preferred platform for liquid staking, will soon have to make an important decision. The outcome of this decision could have a negative impact on the price of LDO Token.
LDO Coin News
Lido Finance DAO aims to introduce its new binary governance model. Lido Finance, the industry’s most popular liquid staking solution, is creating a brand new order for its tokenomics. Marin Tvrdic, the business development manager of LidoDAO, said during this year’s EthCC event that its members were pushing for a binary governance model.
If this proposal is accepted, Lido users will have the right to veto governance votes approved by LDO holders. This could significantly weaken the power of LDO Token holders over governance.
Marin Tvrdic said:
“LDO token is a governance token and its main function is to vote on proposals. You are giving power to the owners to democratically choose what will happen to the protocol. This has raised concerns among stakers. We don’t need to hide it, LDO users (stETH holders) are worried.”
LDO Coin Future
Lido is a leading decentralized platform that allows investors to stake ETH with the network’s validators and earn rewards. In return, they receive a token called stETH, which represents the money they have deposited. Integrated into the DeFi sector, the stETH token allows stakers to remain liquid while securing the network’s funds. This means that users who stake their assets can also trade with fixed stETH Tokens at any time at the ETH price.
According to data from Dune, Lido currently dominates 31.7% of the entire staking market. Coinbase ranks second with 9.6%, and Binance ranks third with 5%.
Lido’s current governance system is based on LDO, which means that only LDO holders can vote on proposals. Naturally, this gives LDO holders a power that stETH holders do not have on the protocol. However, if this balance is disrupted, the attractiveness of LDO Token will decrease to some extent, and we will likely see a decrease in its price.
