Lido is currently working on layer-2 solutions, Arbitrum and Optimism. allocate 150,000 LDO tokens as rewards per month starting Oct 7, for wstETH across all networks
Lido claims that expanding its services to layer-2 Blockchains would improve the accessibility to Ethereum staking and reduce gas fees.
Unlike traditional staking, where stakers can’t withdraw until their staking period lapses, Lido Finance is a liquidity staking platform that provides flexibility for stakers. It allows stakers the flexibility to withdraw their staked tokens at any time they wish.
Lido’s first phase of Layer-2 rollout enables the bridging of Lido’s Wrapped Staked Ether (wstETH) token to the two supported L2 networks while preserving the unique properties of stETH in the process.
Lido gives stETH to stakers as a liquid token for Ethereum staking. WstETH, on the other hand, is the wrapped version of Ethereum that guarantees a fixed balance for each staker. Decentralized finance Applications that need a constant balance mechanism (DeFi).
The protocol stated that the goal of this initiative was to create liquidity on wstETH for liquidity mining incentives on DeFi partners such as Beethoven, Balancer and Curve, Kyber Network and Velodrome.
Notably, Lido’s plan to expand to L2 networks was initially revealed The team had admitted in July that in the near future, a significant portion, if not the majority of economic activity and transaction volumes would migrate to Layer 2 networks.
Lido also chose layer-2 networks Lido initially to deploy in order to have an 80% share of the market. According to L2beatArbitrum has a 50.68% market share, $2.38 billion total value locked (TVL), while Optimism has a 30.68% share with a $1.44 trillion TVL.