Justin Sun has exchanged a large amount of stETH, interest in the token is starting to wane. Lido protocol manages to do well in terms of activity and revenue.
While the Total Value Locked (TVL) in the DeFi market has remained relatively stable, there has been continued growth in the Liquid Staking Derivative sector. Lido[LDO], as a prominent player in this sector, has played a central role in fueling significant interest in this field. Her active involvement has contributed to the expansion and development of this specific market segment due to the growing interest in Lido’s sETH.
Realistic or not, here is the market cap of LDO in terms of BTC
Fly too close to the “Sun”
However, Justin Sun’s recent behavior may cause interest in stETH to wane. Based on recent data, Justin was observed actively cashing out 30,000 stETH from two separate wallets. Despite this redemption, he continues to hold the largest amount of stETH, with approximately 260,000 tokens still in his possession.
his excellency just exchanged 30,000 stETH for 2 wallets, he is still the largest stETH holder with about 260,000 left pic.twitter.com/xAt1Q2LXXU
— alto | dollar.eth (@etheraltog) July 8, 2023
This redemption of stETH by Justin Sun could create uncertainty in the market going forward. According to Santiment’s data, weighted sentiment around stETH has begun to decline significantly. This indicated that the crypto community had more negative than positive things to say about the token at the time of writing.
In addition, it was also observed that the network growth of stETH also slowed significantly in recent days, implying that new addresses began to lose interest in the stETH token.
State of Lido
However, at the time of writing, the revenue generated by Lido and the activity on the protocol remained unaffected. According to Token Terminals data, the number of active users of the protocol has increased by 40.6% in the past week, driving a 2% increase in revenue generated by the protocol.
While interest in sETH may wane in the short term, Lido’s governance proposals to make improvements to the protocol could help attract users to the network in the future.
A recent proposal proposed a tiered reward sharing program that offers a percentage of DAO’s 5% share of staking rewards to participants who stake ETH with Lido.
Is your wallet green? Check out the Lido Profit Calculator
The rewards share program consists of three phases: onboarding, rewards share and offboarding. In the onboarding phase, applicants are reviewed and accepted if they meet the eligibility criteria.
During reward sharing, participants earn rewards based on their stETH contributions and activities. The offboarding phase marks the end of participation. It can happen voluntarily, as a result of disqualification, by DAO voting, or when the reward pool is empty.
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