What is Lido Finance?

Lido Finance is a liquid staking protocol that allows users to stake Ethereum and other proof-of-stake assets while maintaining liquidity. When you stake ETH with Lido, you receive stETH tokens that represent your staked amount plus accrued rewards.

How long has Lido Finance been operating?

Lido Finance launched in December 2020, making it one of the earliest and most established liquid staking solutions in the cryptocurrency ecosystem.

Is Lido Finance decentralized?

Yes, Lido Finance operates as a Decentralized Autonomous Organization (DAO). Major decisions are made through governance votes by LDO token holders, though the protocol uses professional node operators for validation.

What exactly is stETH?

stETH (Lido Staked ETH) is an ERC-20 token that represents ETH staked through Lido Finance plus accumulated rewards. The token balance automatically increases daily to reflect earned staking rewards.

Can stETH be converted back to ETH?

Does stETH always maintain a 1:1 value with ETH?

While stETH aims to maintain close parity with ETH, market conditions can cause temporary price variations. During periods of market stress, stETH has occasionally traded at a discount to ETH, though arbitrage mechanisms typically help restore the peg over time.

What is the minimum amount required to stake with Lido?

There is no minimum requirement to stake ETH with Lido Finance. You can stake any amount of ETH, making it accessible for all types of investors.

What fees does Lido charge for staking?

Lido charges a 10% fee on the staking rewards only (not on the principal). This means if the base staking reward is 5% APR, users receive 4.5% after Lido's fee.

How long does it take to receive stETH after staking?

When staking ETH with Lido, you receive stETH tokens immediately in the same transaction. There is no waiting period to receive your stETH representation.

What happens if validators get slashed?

Lido has implemented a socialized loss model that distributes any slashing penalties across all stETH holders, minimizing the impact on any individual. Additionally, Lido maintains strict validator selection criteria to reduce slashing risks.

Is stETH compatible with hardware wallets?

Yes, stETH is an ERC-20 token that can be stored on any Ethereum-compatible hardware wallet, including Ledger and Trezor devices.

What is the difference between stETH and wstETH?

stETH is a rebasing token that increases in quantity as rewards accrue, while wstETH (wrapped stETH) is a non-rebasing version where the token value increases instead of the quantity. wstETH is often preferred for DeFi integrations due to simpler accounting.