As the withdrawal date for unstaking Ethereum closes in, tokens powering various liquid staking protocols are enjoying a hefty rally.
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Lido Finance (LDO) and Rocket Pool (RPL), for example, have already posted significant gains over the past 24 hours, according to data from CoinGecko.
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LDO, the governance token powering Lido Finance, Ethereum’s largest liquid-staking protocol, gained over 17.2% in the last 24 hours and trades at around $1.88.
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Intense trading for the liquid-staking derivative crypto pumped its daily volumes across multiple exchanges to $276 million, a 436% jump over the previous day.
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With a market capitalization slightly above $1.5 billion, LDO is now the 33th-largest cryptocurrency, per data from CoinGecko.
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Over $1.61 million worth of LDO futures positions were liquidated over the past 24 hours, according to Coinglass. Most liquidations (~66%) came from blown-out short trades.
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LDO liquidations and red bars indicate blown-out short trades.
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Last week was extremely rewarding for LDO. Lido Finance has become the largest decentralized application in terms of total value locked (TVL), dethroning DAI’s creator MakerDAO.
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LDO is also the largest weekly gainer, posting a tremendous 74.8% gain over the past seven days compared to Bitcoin’s meager 3.8% gain over the same period.
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Another liquid staking token, Rocket Pool’s native token RPL, has also enjoyed steep gains of 14.2% over the past 24 hours, according to data from CoinGecko.
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As of this writing, RPL trades at around $26.13, boasting an 802% increase in daily trading volumes to $7.8 million over the past 24 hours.
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Despite today’s greenish momentum, RPL is still down 56.6% from its historical all-time high of $59.46.
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Besides liquid staking tokens, Ethereum itself enjoys 4.4% in daily gains and over 10% in weekly gains.
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Ethereum, Shanghai and staking
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Ethereum successfully switched to a proof-of-stake (PoS) consensus mechanism in early September 2022.
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The switch removed the need for energy-intensive mining equipment essentially overnight, replacing these machines with a leaner staking mechanism. In order to become a validator of this network, users must first put up 32 Ethereum.
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They can earn a percentage yield for doing this and validating the network honestly, or, conversely, can face hefty fines on those staked funds should they behave maliciously.
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Despite the lucrative yield on offer, which today can earn users up to 4%, putting up 32 ETH, or roughly $42,000, is a big ask for many. Services like Lido and Rocket allow investors to stake any amount of Ethereum and still earn their rewards.
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And besides the hefty upfront charge, once those funds are staked, they can’t be removed (until the next Ethereum upgrade).
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Here’s why Shanghai has become such a highly-anticipated upgrade. Once executed, this change will let users withdraw their staked Ethereum.
