By Michael Scott
Two primary reasons behind the sunsetting included untenable financials and reduced fees made by Lido on Solana.
Lido Finance, a decentralized liquid staking protocol, has revealed a decision to terminate activities. This comes after a community vote in Lido’s DAO.
Lido’s peer-to-peer (P2P) team initially proposed to sunset Lido on Solana on September 5. It cited untenable financials and reduced fees made by Lido on Solana. Voting started on September 29 and concluded on October 6.
Lido Token Holders Approve Termination of Activities on Solana
In an October 16 post, Lido explained that following serious decentralized autonomous organization (DAO) discussions succeeded by community vote, Lido token holders approved the Lido on Solana protocol’s sunsetting. Additionally, the process would start soon.
As of October 16, Lido was not approving staking requests. On November 17, the offboarding of the voluntary node operator will start, and by February 4, users of Lido must unstake on Solana’s frontend. Lido added that unstaking will be implemented using the CLI after this date.
The previous proposal entailed Lido seeking $20000 monthly from Lido’s decentralized autonomous organization to enhance technical maintenance initiatives linked to the termination of activities on Solana in the next several months.
Since the Solana project’s acquisition in March of last year from Chorus One, Lido’s peer-to-per team has been working on it.
Net Losses Make Continuity in Business Operations Untenable
Mediakov, the proposal’s author, claims that following the acquisition, an estimated $700000 has been invested into Lido on Solana. Additionally, it has made revenues amounting to $220000, leading to a net loss of $484000.
The option in the September 5 proposal was to offer additional finances to Solana from Lido’s decentralized autonomous organization. Nevertheless, Snapshot, an open-source voting platform, showed that 65M (92.7%) of the 70.1M LDO tokens voted by shareholders supported the termination of activities on Solana.
According to Lido, the decision was challenging but a vital one to make. Specifically, it said that despite the tough decision facing several robust links in the Solana system, it was critical for the vast Lido protocol ecosystem’s continuous success. Further, Lido claimed that during the sunsetting process, token-holders of staked Solana (stSOL) will keep getting network regards.
Currently, Lido’s staking services are solely supported on Polygon and Ethereum. Its website shows that $80B and $14B, respectively, are staked on the platforms.
On September 8, 2021, Lido launched on Solana. CoinGecko’s data showed that at the time, the pricing of Solana’s SOL was $189, representing an 87% reduction from its present price of $24. Despite the news, SOL has risen 8.6% in the past 24 hours.
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