Lido

Lido lets someone stake ETH without running a validator or locking funds. You send ETH to the Lido contract and receive the same amount of stETH. The contract assigns the ETH to professional node operators, who run the validators; rewards accrue to stETH holders, and penalties, if any, come out of the same pool. Your stETH balance changes once a day, when Lido's oracles report the validators' balances.

Lido has no owner company. It is run by the Lido DAO, whose LDO token holders vote on fees, the node operator set and upgrades. Work is done by funded contributors. The largest, the Lido Labs BORG Foundation, asked the DAO for $34.88 million for 2025 to build Lido V3, dual governance and security research. Lido's site says $2.9 billion of rewards have been paid to stakers since 2020, and the project's GitHub organization was created in July 2020.

Besides stETH, Lido now offers Lido Earn vaults (EarnETH at $199.6 million and EarnUSD at $59.4 million on its homepage in October 2026), stVaults for institutions that want a dedicated operator, and an automated buyback programme for LDO funded from DAO revenue, introduced in 2026.

Since the Lido V3 upgrade there are two paths into the same stETH. The Core Pool is the original one: deposits are spread across operators chosen through Lido's staking modules. The Curated Module covers established firms, the Community Staking Module lets smaller operators join by posting a bond, and a Simple DVT module splits validators across operator clusters. stVaults, launched in a first phase in 2025, let a staker or institution pick a specific operator and terms and still mint stETH against an over-collateralized position.

Most DeFi apps use wstETH, a wrapped form whose balance stays fixed while its value in stETH rises, because a changing balance breaks some contracts. Lido's integration guide also warns that stETH transfers can arrive 1 to 2 wei short because of share rounding.

A July 2026 core upgrade began moving more than 265,000 Curated Module validators to compounding withdrawal credentials, which Lido expects to cut the total number of Ethereum validators by about a third. Stakers did not need to act.

Lido charges 10% of staking rewards and nothing on deposit or withdrawal apart from gas. The fee is shared between node operators and the DAO treasury; Lido's 2025 report put the DAO's effective share at 6.10% of rewards at year-end, after a revision of Curated Module fees. The docs define user APR as protocol APR multiplied by one minus the fee, calculated as a seven-day moving average.

When we checked on 14 July 2026, the APR shown on the site was already net of the fee and matched the figure returned by Lido's public API. On 29 October 2026 the site showed 2.3%. That number changes with Ethereum's issuance and with transaction fees paid to validators, so it is an estimate rather than a promised rate.

There are two ways out. The first is the withdrawal queue. You request a withdrawal in the Lido app, which mints an NFT representing your place in line; once the oracle finalizes the request you claim ETH and the NFT is burned. Each request can be between 100 wei and 1,000 stETH, so larger amounts are split. Lido's help centre says this usually takes one to five days, but it depends on how many requests are ahead, Ethereum's validator exit queue, and whether the protocol is in 'bunker mode', a slower setting used when validators face mass penalties.

The second is to sell stETH or wstETH for ETH on an exchange. That is instant but priced by the market. When we measured on 14 July 2026, about $17.2 billion of stETH was outstanding against roughly $113 million of on-chain trading depth, or 0.66%, and 0.07% of supply traded in a day. Selling a small amount costs little. Selling a large amount, or selling when many others are, means accepting a discount, and the queue tends to lengthen at the same moment. During the April 2026 Kelp stress event Lido said stETH pricing moved and depth became more expensive, though the token kept functioning.

Lido is non-custodial for stakers, but you rely on its contracts, its oracles and its node operators. The contracts can be upgraded by LDO governance. Since 2025 those upgrades pass through dual governance, defined in LIP-28: a timelock that stETH holders can extend by locking tokens in an escrow if they object to a DAO decision. Above the first threshold, proposed at 1% of Lido's TVL, the delay grows; above the second, 10%, a 'rage quit' blocks DAO actions until the escrowed stETH has been withdrawn. A Tiebreaker Committee of ecosystem members, builders and operators resolves deadlocks, and an Emergency Committee can act during the early period.

The oracle needs five of nine members to agree. That held in May 2025, when one oracle key operated by Chorus One was compromised and drained of its gas balance; the key was rotated by emergency vote. In July 2025 a whitehat reported a weakness in the dual governance rage-quit path through Lido's Immunefi programme, which pays up to $2 million. It was not exploited and was scheduled for repair in August 2025. Lido keeps its audit reports in a public GitHub repository.

Slashing is a further risk. If an operator's validators are penalized, the loss is shared across all stETH holders in the Core Pool, unless operator bonds cover it, which is the purpose of the Community Staking Module bonds. How Lido's design and record look next to other staking providers is set out in how Lido compares with other liquid staking providers.

Most of what can go wrong with stETH falls into five groups.

• Exit risk: the market for stETH is deep in normal times but small relative to supply, and the protocol queue slows when demand to leave rises.
• Operator risk: if validators run by Lido's operators are slashed or go offline, rewards fall and, in a severe case, stETH holders absorb the loss.
• Contract and upgrade risk: the contracts are upgradeable by LDO governance, limited by dual governance and committees whose members are named on the research forum.
• Integration risk: much stETH sits in lending markets and leveraged loops, so a failure elsewhere, such as the April 2026 rsETH collapse, can force selling of stETH.
• Product risk: Lido Earn vaults and stVaults add strategies and operators on top of stETH, each with its own terms; EarnETH's April 2026 exposure came from that layer, not from stETH itself.

How Lido's protocol record compares with other DeFi systems is covered in how Lido compares with other DeFi protocols.

stETH can be minted by any Ethereum address; the protocol does not check identity. To start, open stake.lido.fi, connect a self-custody wallet holding ETH, enter an amount and confirm one transaction. stETH arrives at once and begins accruing from the next daily report. Institutions use the same token through custodians: Lido's blog lists BitGo Bank & Trust offering Lido staking to eligible US clients and Anchorage Digital supporting wstETH in 2026.

Lido has also narrowed where it operates. In June 2026 a DAO vote removed the canonical status of wstETH bridge endpoints on nine networks, so bridged wstETH on those chains is no longer backed by a Lido-recognized bridge. Check the network list in Lido's docs before buying wstETH outside Ethereum.

Lido's timeline follows Ethereum staking itself, from locked deposits to withdrawals and validator consolidation.

• 2020: Lido launches on Ethereum; rewards paid since that year.
• 22 May 2021: Immunefi bug bounty opens.
• May 2023: withdrawals through the queue become possible after Ethereum enables them.
• May 2025: Chorus One oracle key rotated after compromise.
• 2025: dual governance activated; Lido Earn and stVaults phase one launch; WisdomTree lists a stETH product in Europe.
• April 2026: Kelp's bridge exploit stresses stETH liquidity; Lido proposes 2,500 stETH to the recovery effort.
• June 2026: wstETH bridge endpoints on nine networks lose canonical status.
• July 2026: core upgrade begins validator consolidation.
• October 2026: Lido introduces 0x02 CSM, a permissionless path to running higher-balance validators.