DeFi
Lido Finance and Optimism are rolling out a brand new incentive program to get liquid stakers migrated over to the layer-2 community.
As a part of the LidoOnLayer2 initiative, which seeks to enhance liquidity for Lido’s staked Ethereum (stETH) product throughout all layer-2 options, the venture has been granted 1 million OP tokens from Optimism.
These tokens will present an added OP reward for customers who stake their Ethereum with Lido, transfer that staked Ethereum to Optimism, and supply liquidity for choose token pairs. This system kicks off as we speak and ends in six months.
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OP is the governance token for Optimism, a layer-2 scaling answer that makes use of rollups to assist scale the Ethereum community by shifting exercise off of the mainnet, batching it, after which executing this compressed knowledge on the mainnet.
Lido Finance is the market’s largest liquid staking platform, letting customers deposit a wide range of proof-of-stake (PoS) tokens and earn rewards for doing so. As a substitute of needing 32 ETH, a whopping $49,000 as we speak, to start staking on Ethereum, customers can as an alternative deposit any quantity into Lido and start incomes. The service can also be accessible for Polygon, Solana, Polkadot, and Kusama.
How does the Optimism, Lido program work?
In change for his or her ETH deposits, Lido customers get the stETH token in return, which might then be used elsewhere in DeFi to earn yield or to borrow in opposition to.
By way of this new association with Optimism, customers who select to maneuver their stETH over to the layer-2 community will now earn extra rewards within the type of Optimism’s native OP token.
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Importantly, customers gained’t be migrating stETH to Optimism. As a substitute, as per Lido’s growth to a wide range of totally different layer-2 networks, wrapped stETH (wstETH) would be the accessible asset. This particular asset is extra appropriate and simpler to combine with crypto protocols.
“The worth of wstETH on Optimism is that it additional democratizes entry to liquid staking for individuals who don’t wish to pay or can’t afford to pay mainnet charges,” mentioned Lido’s head of enterprise growth and partnerships Jacob Blish. “By incentivizing nice wstETH liquidity on Optimism, furthering adoption and contributing to the safety of the ecosystem.”
Thus, customers fascinated about scooping up this additional OP yield can achieve this in the event that they flip to what Lido has known as “precedence pairs,” specifically wstETH-ETH in addition to a number of different stablecoin swimming pools.
Lido has named Aave, for instance, as one venture that might profit from this system. Which means customers that deposit their wstETH on the favored DeFi lender by way of Optimism can earn a further yield in OP tokens.
