Lido wstETH
Crypto Overview
Purpose and Utility
wstETH is a wrapped version of stETH, which represents staked ETH in the Lido protocol. Lido is a liquid staking solution that allows users to stake their ETH while maintaining liquidity. When users stake ETH through Lido, they receive stETH tokens which automatically accrue staking rewards. wstETH wraps stETH to provide a non-rebasing variant that maintains a constant ratio to stETH, making it more compatible with DeFi protocols.
Business Model Analysis
The token serves as a representation of staked ETH assets, with its value directly tied to the underlying staked ETH plus accumulated rewards. The primary utility is providing liquidity for staked ETH while enabling users to participate in Ethereum's proof-of-stake consensus mechanism.
Real-World Adoption
wstETH has significant adoption in the DeFi ecosystem, with major protocols like Aave, Curve, and Balancer incorporating it. As of 2024, Lido is the largest ETH staking provider, with over 9 million ETH staked through the protocol.
Platform Development
Lido maintains active development with regular updates to its smart contracts and infrastructure. The protocol has undergone multiple security audits and continues to implement improvements to its staking mechanism and token utilities.
Token Distribution
wstETH is minted based on user deposits of stETH, with no pre-mine or founder allocation. The token supply directly corresponds to the amount of staked ETH in the protocol.
Crypto Impact
To assign a comfort level investing in Lido wstETH from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to Lido wstETH.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.