Lido solidifies mastery in DeFi landscape after major upgrade: Details inside
- Lido launched upgrade to improve its protocol.
- The improvements boosted LDO token performance.
Lido [LDO], a protocol in the DeFi ecosystem, has observed significant improvements over the past week. Notably, the protocol took advantage of its press time growth by upgrading its technology.
Today Lido contributors are proud to present Lido V2 – Lido’s largest upgrade to date and an important step towards further decentralization. https://t.co/SDxlxCgMNq pic.twitter.com/KJewhEp8rV
— Lido (@LidoFinance) February 7, 2023
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The first upgrade, the Staking Router, will be a platform for stakers, developers, and node operators to collaborate. Moreover, it will provide the infrastructure for stakers to easily navigate the staking landscape.
The second upgrade will be related to withdrawals and will allow Staked Ethereum [stETH] holders to withdraw their tokens from the Lido ecosystem at a 1:1 ratio, with no added fees or penalties.
Without Lido, the Ethereum [ETH] ecosystem would become highly centralized, as large exchanges such as Coinbase, Kraken, and Binance would dominate the network.
However, with Lido’s recent upgrades, the ecosystem has become more decentralized. This has provided a new level of security and stability for the network. Expectedly, the announcement has caused a positive impact on the LDO token, with daily active addresses and velocity both increasing.
A spike in velocity suggested that the frequency with which LDO was being transferred has grown, and the growing MVRV ratio suggests that if a majority of holders were to sell, they would end up making a profit.
The positive Long/Short difference implied that it is mostly long-term holders who are currently profitable. These long-term holders were not as likely to sell and make a profit.
Traders turn pessimistic
However, despite these positive developments, the number of short positions against Lido increased, indicating that some traders were pessimistic about LDO’s growth. According to Coinglass, the percentage of short positions against LDO increased to 52.35%.
How much is 1,10,100 LDO worth today?
It remains to be seen whether the traders turn out to be correct about LDO’s future.
Nevertheless, Lido’s commitment to its growth and dominance in the DeFi ecosystem shows that the protocol is confident in its ability to continue its upward trajectory. As the DeFi ecosystem continues to evolve, Lido will be a key player, as it will provide the infrastructure for stakers, developers, and node operators.