- Lido has passed the vote to upgrade the protocol to Lido v2.
- stETH holders can now exchange stETH for ETH one to one.
- Celsius is among the largest potential withdrawers of stETH.
Ethereum has recently implemented the Shapella upgrade, which allowed validators to withdraw their staked ETH for the first time since 2020.
Contrary to popular belief, the event had virtually zero impact on the price of ETH. Not only that, the number of active Ethereum validators has only increased.
This might change as Lido, the largest liquid staking derivatives (LSD) protocol, has enabled stETH withdrawals.
Lido Enables stETH Withdrawals
Lido announced on Monday that the proposal to upgrade the protocol to v2 has passed.
Lido v2 brings two new features. The first is that stakers can now finally exchange their staked ETH (stETH) tokens for ETH.
Lido was the last major protocol to enable ETH withdrawals. Now there are no other protocols whose ETH unlock could affect the price of ETH or spur a validator exodus.
The second new feature that Lido v2 brings is Staking Router. Lido said that the new feature will allow for the “development of on-ramps for new Node Operators.”
“The new modular architectural design allows for the development of on-ramps for new Node Operators, ranging from solo stakers to DAOs and Distributed Validator Technology (DVT) clusters. This will create a more diverse validator ecosystem.”
With Lido v2 now being live, all eyes are on who is withdrawing stETH and how much.
Celsius Moves Massive Amounts of stETH
In around 24 hours since stETH withdrawals were enabled, a significant amount of stETH has been withdrawn already.
According to data from Nansen, almost 12,000 stETH have been withdrawn from Lido. 12,000 ETH is equivalent to around $22 million.
However, there’s another massive stETH withdrawal looming. Celsius, the bankrupt crypto lender, had moved its 428,000 stETH, worth around $780 million, minutes before Lido enabled withdrawals.
Celsius then made a test withdrawal of 0.1 stETH. However, the full amount has yet to be withdrawn.
ETH is currently trading at $1,820, according to data from CoinGecko.
On the Flipside
- Celsius might need court approval to withdraw its stETH. The company is also likely to continue staking ETH independently instead of through a middleman like Lido.
Why You Should Care
Lido enabling stETH withdrawals is a huge milestone for the Ethereum community. Users can finally withdraw their stakes and use them somewhere else.
Read more about ETH validators numbers:
Read more about a potential Polygon airdrop: