Which proposal pivots LDO into DeFi?

The proposal titled “2026 Ecosystem Grant Request (EGG): Executing GOOSE‑3” outlines Lido DAO’s plan to expand beyond just liquid staking into a wider range of decentralized finance (DeFi) products. For more details, see The Defiant’s coverage: “Lido Outlines $60M Plan to Expand Beyond Liquid Staking”.

1. Scope: A multi-year plan to create new earning products and vault structures beyond staking, including offerings related to stablecoins and other asset types, as summarized in the proposal.
2. Budget: $60 million allocated to support the expansion into DeFi products, according to the report.
3. Status: The plan is set for a DAO vote to shift Lido’s focus toward a diversified DeFi platform over three years, as noted in a governance roundup.

Deep Dive

1. What It Is

EGG 2026, also called “Executing GOOSE‑3,” is Lido DAO’s roadmap to grow from a single staking product into a broader DeFi platform with multiple ways to generate revenue. The goal is to build new earning products and vaults aimed at users like on-chain treasuries and regulated organizations, moving beyond just ETH liquid staking, as explained in the proposal coverage.

What this means: Governance of Lido DAO would shift from managing one main product to overseeing a portfolio of products. This diversification can reduce risk and increase revenue sources but also makes managing the project more complex.

2. What It Builds

The plan focuses on products connected to stablecoins and other asset classes to attract more users and diversify income. The $60 million budget is dedicated to developing these new DeFi products, according to the report. Other coverage describes this as a three-year pivot toward a diversified DeFi suite, reinforcing the long-term nature of the plan in a governance roundup.

What this means: If successful, Lido could generate fees from sources other than ETH staking cycles. However, this also introduces new risks related to product development and market acceptance, especially in areas like stablecoin yield strategies.

3. Timing And Vote

Media reports indicated the voting period was around mid-December, framing it as a key decision for the DAO’s future direction. The vote reached quorum, as noted in The Defiant’s proposal coverage and CoinDesk’s governance calendar (The Defiant; CoinDesk roundup).

What this means: Approval by the DAO sets the strategic direction. The next steps will be tracking progress and adoption of the new products.

Conclusion

EGG 2026 is a proposal to shift Lido DAO (LDO) toward a more diversified DeFi product lineup. It aims to create new revenue streams beyond staking with a substantial budget. Success will depend on how well the team executes and how the market responds to stablecoin and other DeFi offerings. If these products gain traction, LDO’s value could become less reliant on the performance of a single staking cycle.

What could affect the price of LDO?

Lido DAO (LDO) is currently navigating between exciting growth plans and ongoing market doubts.

1. $60 Million Growth Plan – Expanding beyond just staking could open new revenue streams (Mixed impact)
2. Buyback Program – Token burns linked to Ethereum’s price and revenue could boost value (Positive if activated)
3. Legal Challenges – A California court ruling raises concerns about liability for token holders (Potentially negative)

In-Depth Look

1. Expanding Beyond Staking: A New Direction for Lido DAO (Mixed Impact)

What’s happening:
Lido DAO has proposed a $60 million budget for 2026 to develop new products like DeFi vaults, institutional staking options, and experiments with real-world assets. This move aims to reduce dependence on Ethereum staking, where Lido currently holds about 51% of the market.

Why it matters:
If successful, Lido could earn fees from these new services, creating more ways to generate revenue. However, there are risks involved, such as the possibility of investing in projects that don’t deliver expected returns. Until these new products gain traction, the impact on LDO’s price is uncertain.

2. Buyback Program: A Potential Boost for LDO (Positive Signal)

What’s happening:
Lido has proposed an automatic buyback plan that would use half of its staking revenue above $40 million per year to buy back and burn LDO tokens, with a maximum of $10 million spent annually. This program would only kick in if Ethereum’s price stays above $3,000.

Why it matters:
This setup means that during strong Ethereum markets, Lido reduces the number of tokens available, which can increase the value of remaining tokens. In weaker markets, there’s no added selling pressure. Historically, Lido’s revenue has reached around $90 million, so this buyback could potentially reduce the circulating supply by about 11% each year if Ethereum performs well.

3. Legal Risks: A Cloud Over Lido’s Future (Potentially Negative)

What’s happening:
In 2024, a California court ruled that Lido DAO functions like a general partnership, which could make token holders legally responsible for the DAO’s actions. This decision is currently being appealed but creates uncertainty for Lido’s operations in the U.S.

Why it matters:
This legal uncertainty might discourage big investors and institutions from getting involved with Lido. Since the ruling, LDO’s price has dropped about 67%, much more than Ethereum’s 12% decline during the same period, showing that the market is factoring in this risk.

Summary

Lido DAO’s future depends on successfully growing beyond staking while managing legal and market challenges. The buyback program offers a positive opportunity, but only if Ethereum’s price remains strong. Keep an eye on the upcoming December vote on the $60 million budget and whether Ethereum can stay above $3,000.

Will Lido evolve from a staking-focused platform into a diverse DAO before legal and competitive pressures become too strong?

What are people saying about LDO?

The Lido DAO (LDO) community is actively discussing recent price movements and the token’s economic design, while large holders adjust their positions. Here’s what’s trending:

1. Technical analysts disagree – some see a short-term price rebound, others warn of a continuing downtrend
2. Buyback proposal gains attention – could a plan to buy back tokens boost LDO’s value?
3. Institutional activity raises concerns – Paradigm Capital’s $8.4 million LDO transfer signals potential selling pressure

Deep Dive

1. @bpaynews: Mixed short-term price outlook

“Target $0.66–$0.70 within 4 weeks as oversold conditions and key support at $0.49 create potential reversal setup”
– @bpaynews (2K followers · 419 media · 2025-12-19 14:00 UTC)
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What this means: There’s a cautious optimism here. While the overall trend looks bearish, the price level of $0.49 is seen as a strong support point. If LDO holds above this, it could bounce back by over 30%. But if it falls below, the price might drop further.

2. @0x1CMC: Bearish tokenomics critique

“No direct value accrual to tokenholders [...] Simple governance vote to allocate 30% of earnings into buybacks will dramatically help price”
– @0x1CMC (2K followers · 435 media · 2025-12-18 16:58 UTC)
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What this means: This points to a bigger issue with LDO’s design. Despite the DAO earning $81.8 million annually, token holders don’t directly benefit from these profits. The suggestion is to have the DAO use 30% of its earnings to buy back tokens, which could support the price—but this needs approval from the community.

3. @WuBlockchain: Institutional selling alert

“Paradigm Capital transferred 10M LDO ($8.4M) [...] sold 50M LDO at $1.31 average in 2024”
– @WuBlockchain (548K followers · 4,435 media · 2025-06-10 01:49 UTC)
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What this means: Large investors like Paradigm Capital are selling significant amounts of LDO, which could put downward pressure on the price. Paradigm still holds about 20 million LDO from their original purchase, so more selling could happen.

Conclusion

The outlook for LDO is mixed. On one hand, oversold conditions and strong DAO earnings ($81.8 million) suggest a possible price rebound. On the other hand, ongoing selling by big investors and the lack of direct rewards for token holders limit upside potential. Keep an eye on the $0.49 support level and the progress of the buyback proposal, which aims for implementation in early 2026. If the price falls below support or the DAO delays action, the recent 40% drop over 60 days could continue.

What is the latest news about LDO?

Lido DAO is making important moves to improve security and grow its services, while gaining more attention from everyday investors. Here’s a quick summary of the latest news:

1. Whitehat Safe Harbor Approved (December 19, 2025) – Legal protections now allow trusted security experts to quickly respond to threats, helping safeguard $26 billion in staked Ethereum (ETH).
2. $60 Million Expansion Plan Proposed (December 19, 2025) – Lido aims to expand beyond just liquid staking into a broader decentralized finance (DeFi) ecosystem with multiple products.
3. Robinhood Lists LDO (December 18, 2025) – Lido’s token (LDO) is now available on Robinhood, opening access to millions of retail investors, though these users can’t participate in governance voting directly.

In-Depth Look

1. Whitehat Safe Harbor Approved (December 19, 2025)

What happened:
Lido DAO approved a new legal framework that lets pre-approved security experts, known as “whitehats,” step in immediately during live attacks on the protocol without fear of legal trouble. Previously, these experts had to wait 1 to 3 days before acting due to liability concerns.

Why it matters:
This is a big positive for LDO because it lowers the risk of major security breaches for the protocol, which currently secures about 24% of all staked ETH. By having a fast-response “SWAT team” for its smart contracts, Lido becomes more attractive to institutional investors while still keeping control decentralized. (Source: CoinMarketCap)

2. $60 Million Expansion Plan Proposed (December 19, 2025)

What happened:
The “GOOSE-3” proposal outlines Lido’s plan for 2026 to grow beyond liquid staking. This includes launching institutional vaults and experimenting with real-world assets. The $60 million budget aims to add 1 million new ETH staked through upgraded staking vaults (stVaults) and a new validator marketplace called ValMart.

Why it matters:
This plan is cautiously optimistic. While it could create new ways for Lido to earn revenue beyond its current 10% fee on staking rewards, there are risks. The DeFi market is competitive, and regulatory challenges for institutional products remain uncertain. Success depends on how well Lido can navigate these hurdles. (Source: CoinMarketCap)

3. Robinhood Lists LDO (December 18, 2025)

What happened:
Robinhood, a popular trading app with over 23 million users, added LDO for spot trading. This makes it easier for everyday investors to buy and sell LDO tokens. However, tokens held on Robinhood don’t allow users to vote on Lido DAO governance proposals.

Why it matters:
This has mixed effects. On one hand, it increases liquidity and raises Lido’s profile—trading volume jumped 35% after the listing. On the other hand, it highlights a gap in governance participation, since only about 59% of the circulating LDO supply currently votes on decisions. More mainstream adoption could weaken decentralized control. (Source: CoinMarketCap)

Conclusion

Lido DAO is strengthening its core staking business while carefully branching out into new DeFi areas. It’s balancing important security improvements with growth plans. The key question is whether LDO can evolve from a token mainly used for staking into a broader governance asset—without losing its decentralized nature or market leadership in liquid staking.

What is expected in the development of LDO?

Lido DAO’s roadmap is focused on improving its technology and growing its community.

1. Validator Marketplace Launch (Mid-2026) – Introducing ValMart, a new system that dynamically allocates stakes to Ethereum validators.
2. stVaults Expansion (2026) – Aiming to have 1 million ETH staked through partnerships with institutions.
3. Automated LDO Buybacks (Q1 2026) – Using extra revenue to buy back LDO tokens and reduce supply.

Deep Dive

1. Validator Marketplace Launch (Mid-2026)

Overview:
Lido will release Staking Router v3 and Curated Module v2, which together create ValMart—a decentralized marketplace for Ethereum validators. Instead of fixed fees, stake allocation will be based on validator performance. This change is expected to increase Lido DAO’s revenue by about 2,600 ETH per year (Lido Poolside Recap, Nov 2025).

What this means:
This is a positive development for LDO because it makes the protocol more efficient and increases revenue, while also spreading stake more fairly across validators. However, if validators are slow to adopt or technical issues arise, the rollout could be delayed.

2. stVaults Expansion (2026)

Overview:
With Lido V3, stVaults let custodians and Layer 2 networks create custom staking products using stETH liquidity. The goal is to have 1 million ETH staked through these products by the end of 2026, focusing on institutional investors (Lido Forum, Nov 2025).

What this means:
This is somewhat positive but depends heavily on forming partnerships with regulated institutions. If successful, it could increase demand for stETH and LDO governance tokens. However, regulatory uncertainty remains a significant risk.

3. Automated LDO Buybacks (Q1 2026)

Overview:
Lido plans to use half of its revenue (when ETH prices are above $3,000 and annual revenue exceeds $40 million) to buy back LDO tokens. These tokens will be paired with wstETH in a liquidity pool. To avoid disrupting the market, buybacks will be capped at $10 million per year (Lido Research Forum, Nov 2025).

What this means:
This is cautiously optimistic. Buybacks could reduce selling pressure on LDO and better align the token’s value with the protocol’s success. However, this depends on ETH price stability and meeting revenue targets.

Conclusion

Lido’s roadmap aims for steady growth through technical improvements (ValMart), expanding institutional partnerships (stVaults), and refining token economics (buybacks). These steps could boost LDO’s usefulness, but challenges like execution risks and market conditions will play a big role. The key question is whether Lido’s move toward multiple products will help it stay a leader in the evolving liquid staking space.

What updates are there in the LDO code base?

Lido DAO's software is actively being improved with a focus on security, governance, and supporting Ethereum staking.

1. Dual Governance Module (Aug 8, 2025) – Added stronger smart contract checks and a warning system for governance decisions.
2. CSM v2 Mainnet Launch (Oct 2, 2025) – Upgraded staking with better rewards and incentives for verified node operators.
3. Triggerable Withdrawals Activation (June 30, 2025) – Anyone can now initiate validator exits directly through Ethereum’s network layer.

In-Depth Look

1. Dual Governance Module (Aug 8, 2025)

What happened: The Ethereum SDK update (version 4.5.1) introduced tighter checks to confirm smart contracts are authentic, preventing fake contracts from causing harm. It also tracks governance proposals more carefully. If a certain number of stETH holders oppose a proposal, the system will delay its execution to prevent rushed or risky decisions.

Why it matters: This update makes Lido DAO safer by reducing the chance of attacks on governance. It also helps token holders understand when a proposal might be controversial, giving them time to respond.
(Source)

2. CSM v2 Mainnet Launch (Oct 2, 2025)

What happened: The Community Staking Module version 2 was launched, increasing the maximum stake by 5%. Verified independent node operators can now earn better rewards and have lower bond requirements. The update includes identity checks for these operators and supports deploying validators in clusters, which helps spread out control and reduce centralization.

Why it matters: This change is generally positive for Lido DAO. It strengthens the network by encouraging more diverse and smaller operators to participate, though it will take time to see how many adopt these new features.
(Source)

3. Triggerable Withdrawals Activation (June 30, 2025)

What happened: The update allows anyone to trigger validator exits directly through Ethereum’s execution layer, removing the need to rely on node operators to process withdrawals. This is done through a system that verifies exit requests to ensure only Lido validators are affected. All node operators had to upgrade to Validator Ejector 1.9.0 to support this.

Why it matters: This is a big step toward decentralization and user control. It reduces risks related to central points of failure and lets users manage their staking withdrawals more independently.
(Source)

Conclusion

Lido DAO’s recent updates focus on making the platform more decentralized, giving users more control, and improving governance safety. These changes fit well with Ethereum’s goals but will require time for node operators and the community to fully adopt. A key question remains: how quickly will community stakers take advantage of the new 5% stake limit in CSM v2?

Why did the price of LDO go up?

Lido DAO (LDO) increased by 2.16% in the last 24 hours, outperforming the overall crypto market, which was nearly flat (-0.01%). This rise is linked to recent governance achievements and plans for growth, although LDO is still down 12.6% over the past month.

1. Security Upgrade Approved – A Safe Harbor Agreement was passed to protect $26 billion in staked Ethereum (ETH).
2. Expansion Plan Proposed – A $60 million budget is suggested to develop new products beyond liquid staking.
3. Technical Price Recovery – LDO’s price is holding above important short-term averages despite longer-term downward trends.

Deep Dive

1. Security Upgrade Approved (Positive Outlook)

What happened:
On December 19, 2025, Lido DAO approved a Whitehat Safe Harbor Agreement. This agreement allows ethical hackers to safely report and fix vulnerabilities without fear of legal trouble. This is a big step toward making the platform more secure.

Why it matters:

• It lowers the risk for the $26 billion worth of ETH staked through Lido, making it more attractive to large investors.
• It helps prevent panic selling that could happen if a hack occurs, supporting steady demand for stETH, which is crucial for LDO’s revenue.

What to watch:
Look for how widely this security measure is adopted and whether more ETH gets staked through Lido.

2. Expansion Plan Proposed (Mixed Outlook)

What happened:
A proposal suggests using $60 million to create new decentralized finance (DeFi) products like vaults and tools for institutional investors. This aims to diversify Lido’s income beyond just liquid staking fees.

Why it matters:

• Positive: Could reduce dependence on staking fees, which have dropped 5% this year, and open new revenue opportunities.
• Negative: There’s risk in successfully launching new products, and concerns about diluting the value of existing tokens since the DAO treasury holds about 10% of all LDO tokens.

What to watch:
The outcome of the DAO vote expected in late December and the detailed plan for rolling out these new products.

3. Technical Price Recovery (Neutral Outlook)

What happened:
LDO’s price is currently above its 7-day simple moving average ($0.536) and exponential moving average ($0.544), with a Relative Strength Index (RSI) of 39.88, indicating neutral momentum. Key resistance is around $0.637, and support is near $0.492.

Why it matters:

• Short-term price movement favors buyers, but long-term trends remain weak, with the 200-day EMA at $0.942 signaling downward pressure.
• Trading volume is low ($39.3 million, about 8% of market cap), so gains may be fragile unless the price breaks above $0.55 with stronger volume.

Conclusion

Lido DAO’s recent price increase reflects positive sentiment around its improved security and growth plans. However, long-term success depends on effectively diversifying revenue as the ETH staking market matures. A key factor to watch is the price of Ethereum itself—if ETH falls below $2,800, it could reduce demand for stETH and impact LDO’s fee-based income.