Lido DAO (LDO) surged 34.5% in the last seven days leading up to Friday afternoon trading close in Asia, as Ethereum’s upcoming March upgrade is expected to resolve current risks in ETH, or Ether staking. BitDAO also gained 22% with its buyback plan that attracted users who sought greater transparency.
See related article: What the FTX collapse means for the future of crypto
Fast facts
- Lido DAO (LDO) fell 4% in the last 24 hours to 5 p.m. in Hong Kong to US$1.29, while BitDAO (BIT) lost 0.42% to US$0.41, according to CoinMarketCap data.
- DAO, or decentralized autonomous organization, is a blockchain-based entity with no central leadership, giving token holders rights to contribute to its governance such as crypto issuance and management. LDO and BIT are the governance token of Lido and BitDAO, respectively.
- Lido DAO provides indirect liquidity and additional rewards to ETH stakers by pegging Lido Staked ETH (stETH) to the value of their assets locked in the smart contract. The staking service is currently the second largest decentralized finance (DeFi) protocol with US$6.15 billion in total value locked, according to DefiLlama.
- LDO’s price surge has been attributed to Ethereum developers’ recently setting the date for the blockchain’s upcoming Shanghai hard fork. The upgrade, set to take place before March, plans to enable Ether stakers to withdraw their assets from the proof-of-stake Beacon Chain, which was previously unavailable to them.
- “The risk of not knowing when they can withdraw their [staked] assets is a factor of price discount,” Paik Hoon-jong, the chief operating officer of South Korea-based blockchain fintech firm DA:Ground told Forkast in a video interview. “The announcement resolved a lot of anxiety about ETH 2.0,” said Paik, adding that the relief prompted many investors to look into ETH-related products and services, such as Lido.
- BitDAO is an entity built on Ethereum where holders of BIT vote on proposals and contribute to its investment decisions in crypto and the DeFi ecosystem. It is backed by Bybit exchange, billionaire venture capitalist Peter Thiel and Pantera.
- Last week, the BitDAO community approved a proposal to buy back US$100 million worth of BIT in USDT for supply maintenance. BitDAO started the 50-day, US$2 million -per-day buyback on Jan. 1.
See related article: Biggest blockchain trends for 2023 and beyond