Ethereum Staking Platform Lido Taps Layer 2 Networks Arbitrum, Optimism
Crypto staking service provider, Lido, launched on Ethereum layer 2 networks Arbitrum Bridge and Optimism.
Lido first revealed its plans to expand stETH across the growing layer 2 decentralized finance ecosystem in July this year. The move is expected to further improve Ethereum staking accessibility.
- According to the official tweet, the expansion of wstETH, which is essentially a “wrapped” version of the staking coin stETH, will allow traders to stake tokens directly on the layer 2 networks.
- In an earlier proposal, Lido said that the rebasing nature of stETH, bridging it to other networks is difficult and hence, the wrapped version of stETH, namely wstETH was chosen.
“wstETH is the wrapped, non-rebasing version of Lido’s stETH. For our initial deployment to L2, we have made the decision to support only wstETH. This is due to a number of reasons, including simplified bridge contracts and ease of integration, both with bridges and general DeFi space.”
- The announcement also revealed that Lido is allocating 150,000 Lido DAO (LDO) tokens in rewards per month from October 7 for wstETH bridged across each network, beginning with liquidity mining incentives on various DeFi partners including Balancer, Curve, and Kyber Network.
- Lido noted that Arbitrum and Optimism were picked after considering several parameters, including DeFi activity, the TVL, the technological difficulty of bridging assets, network security track records, and the presence of the liquid staking protocol’s longtime partners on the said networks.
- It was earlier reported that both Optimism and Arbitrum managed to outshine their sidechain counterparts this year.
- Both the layer 2 scaling solutions for Ethereum maintained an upward trajectory in terms of transaction count and unique active wallets.
- Data suggested that Arbitrum had a market share of over 50.8%, trailing behind which was Optimism with 30.63%. Their respective TVLs stood at $2.41 billion and $1.45 billion
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