Lido Merge Staking Providers

    Tracking Lido liquid staking activity

    Introduction

    Lido is a platform that offers one of the best options for staking with Ethereum. We have seen that stETH is one of the great advantages of the ecosystem, where Lido offers high incentives unlike the competition in the market. Not only for the rewards you can get with ETH staking, but with the main use cases that a user can have if he gets stETH.

    stETH is a token that represents the staked Ether in Lido, combining the initial deposit value with rewards. Thus, stETH is a token that allows you to earn DeFi yield rewards. \n stETH is the liquid token for betting ETH staked in the Eth2 contract with which users who bet their ETH in the Eth2 contract through Lido will receive the equivalent liquid token in the form of stETH. It can be exchanged, sent, loaned and more, allowing you to engage in DeFi activities even after wagering. Therefore, users can use stETH in the same ways they can use ETH: sell it, spend it, and even use it in DeFi, as collateral for blockchain loans.

    when you bet ETH with Lido, you receive stETH to mirror your Ethereum wagered. Once transactions are enabled on Eth2, you can redeem your wagered ETH using your stETH. stETH is a liquid token that can be exchanged, sent, loaned and more, allowing you to engage in DeFi activities even after wagering. Therefore, users can use stETH in the same ways they can use ETH: sell it, spend it, and even use it in DeFi, as collateral for blockchain loans.

    stETH will be an important primitive base in DeFi, and a fundamental building block for Ethereum’s bitcoin-money stack, allowing users to participate in the DeFi ecosystem of Yearn, Curve, Maker, Aave while accumulating Eth2 rewards earned by betting during phase 0.

    Moreover, it does not have the disadvantages of Staking 2.0, as Lido’s stETH has been created with the aim of eliminating the disadvantages of betting directly on the Eth2 contract: illiquidity, immobility, inaccessibility.

    It seems like Lido could give less rewards than other competitive platforms. Howeve, if we take a look on the main sites and the percentatge of benefits, we can see that there are no such difference between them and Lido. However, Lido are offering additional benefits for its users and providing different use cases. In the following image, you can see the different percentages of different finance pages.

    Methodology

    To be able to track the stETH deposits on Lido platform, I have taken into account the data provided on the Ethereum Core Flispide Crypto database called ez_token_transfers, filtering by transactions interacting with the contract address 0xae7ab96520DE3A18E5e111B5EaAb095312D7fE84, which refers to the stETH contract on Lido, and a from address like 0x0000000000000000000000000000000000000000, which refers to a null address, because of it considers a stETH deposit to the platform.

    Then, I have studied the following metrics:

    • Number of stETH depositors, average deposits per user and average volume deposited
    • Monthly staking actions, depositors and volume deposited
    • DCA strategy users
    • DCA user metrics such as average deposits, average stETH deposited, and total stETH deposited
    • Percentage of stETH deposited on Lido by DCA users
    • Deposit average, median, minimum and maximum
    • Distribution of amount of stETH deposited
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    So far, a total of more than 80k users deposited ETH on Lido, with an average above 1.5 deposits per user and more than 50 ETH deposited on it.

    In a monthly basis, we can see how there was a good increase on the activity during the past summer, when all the metrics spiked to ATHs. Another importan increment of the activity were registered from February to May of this year, but it seems that it decreased since the LUNA crash. However, the numbers are so good for Lido in terms of deposits and depositors, both situated above 5k monthly actions. In contrast, the volume experimented a sudden decrease since June 2022. It is curious that the highest values were registered during the previous month maybe because of the Merge is coming.

    The distribution of ETH deposited by range of ETH deposited can be clearly seen on the left image. The major of the deposits are below 10 ETH.

    It can be seen a huge number of deposits between 10 and 100 ETH as well (more than 15k). A little bit more than 3k deposits were registered with a volume between 100 and 1k ETH. No more than 500 deposits were above 1k ETH.

    Looking at the average, median, minimum and maximum metrics, we can see how all of them decreased over the past months.

    While during the past year the metrics seemed to be constant, since April 2022 it started to decrease, all followed by the UST depegging moment. The maximum decreased from 45k ETH to less than 1k, the minimum from 0.000135 to 0.000102, the average ETH deposited from 77 to below 2 and the median from 1 to 0.05.

    Finally, I have analyzed the DCA strategies implemented by Lido users.

    Considering users who deposited more than 5 times with a timeframe above 7 days, and with similar amount of ETH deposited, I have found a total of 92 users involved.

    These users performed an average of 145 deposits and deposited an average of around 10 ETH.

    The total ETH deposited by DCA users are above 4% of the total stETH on Lido.

    Conclusions

    In this dashboard we have analyzed the Liquid ETH Staking on Lido through stETH. There is a global study and also a DCA users study. The key insights extracted have been the following:

    • So far, a total of more than 80k users deposited ETH on Lido, with an average above 1.5 deposits per user and more than 50 ETH deposited on it.
    • Looking at the average, median, minimum and maximum metrics, we can see how all of them decreased over the past months.
    • The major of the deposits are below 10 ETH.
    • Considering users who deposited more than 5 times with a timeframe above 7 days, and with similar amount of ETH deposited, I have found a total of 92 users involved. These users performed an average of 145 deposits and deposited an average of around 10 ETH.
    • The total ETH deposited by DCA users are above 4% of the total stETH on Lido.
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