Lido on Solana: Why the Decision to Wind Down Operations Was Necessary
Lido Finance, a decentralized liquid staking protocol, recently announced its decision to cease operations on the Solana blockchain. This decision came after a community vote within Lido’s decentralized autonomous organization (DAO).
The Need for Sunsetting Lido on Solana
The proposal to wind down Lido on Solana was presented by Lido’s peer-to-peer team on September 5. They cited financial unsustainability and low fees as the primary reasons for this decision. The voting process took place from September 29 to October 6 and was approved by Lido token holders.
Lido explained in an October 16 post that after extensive discussion and a community vote, the sunsetting of the Lido on Solana protocol was approved. As a result, the process will begin shortly.
Important dates to note include the fact that Lido will no longer accept staking requests as of October 16. Voluntary node operator off-boarding will commence on November 17. Additionally, Lido users will need to unstake their assets on Solana’s frontend by February 4. After this date, unstaking will require the use of the Command Line Interface (CLI).
Reasons for the Decision
Lido’s P2P team has been working on the Lido on Solana project since its acquisition from Chorus One in March 2022. During this period, the team invested approximately $700,000 into Lido on Solana and generated $220,000 in revenue. As a result, they faced a net loss of $484,000, as stated by the proposal’s author, mediakov.
The alternative proposal was to provide additional funding to Solana from Lido DAO. However, the majority of LDO token holders (92.7%) voted in favor of sunsetting operations on Solana. This decision was recorded on the open-source voting platform Snapshot.
While it was a difficult choice, Lido recognized it as a necessity for the continued success of the broader Lido protocol ecosystem. The decision was made in consideration of the relationships across the Solana ecosystem.
Impact on Token Holders
Lido confirmed that staked-Solana (stSOL) token holders will continue to receive network rewards throughout the sunsetting process. However, Lido’s staking services will now only be supported on Ethereum and Polygon.
Despite the wind-down of operations on Solana, Lido’s commitment to providing staking services remains strong on Ethereum and Polygon. With $14 billion and $80 million staked, respectively, Lido is focused on these platforms to drive its future growth and success.
Editor Notes: Uber Crypto News congratulates Lido Finance on their decision to wind down operations on Solana after careful consideration. It is essential for decentralized projects to make necessary adjustments to ensure sustainability and success. To stay updated on the latest developments in the crypto industry, visit Uber Crypto News.