Lido Staked Ether

Lido Staked Ether is a type of tokenized Ethereum asset on the Lido platform. Normally to run a validating node for ETH 2.0 beacon chain, a user must have at least 32 ETH. Those investors who do not have the required amount, and want to take part, need to delegate their tokens to a staking pool. Lido platform was created in order to help with liquidity problems in early ETH 2.0 staking. This is done by making ETH liquid and letting users participate in staking, no matter how much ETH they are willing to stake. Thanks to this approach, more validators can actively help with network security.

When a user decides to stake with Lido, they deposit ETH and receive stETH on a 1:1 basis. The stETH token is representative of the value of the deposit combined with staking rewards. These tokens are being minted with each deposit and burned upon each withdrawal. Rewards gained from staking stETH on Lido are applied daily.

When a user receives their stETH they can take part in liquid staking. This protocol lets users gain staking rewards, with no need to lock their assets. The tokens are being staked by a DAO-controlled smart contract, which chooses elected staking providers. These providers don't have access to staked assets, as all funds are controlled by the DAO. Lido's DAO governs, manages risks, and qualifies new node operators for the system, amongst other things.

ETH 2.0 validating carries a risk of receiving harsh penalties. Lido minimizes slashing risks by staking funds across multiple validators at once. Lido's code is open-source and undergoes frequent reviews to ensure there are no bugs or other vulnerabilities in the code itself. Another aspect of Lido's security is its referral program. It requires the user to get whitelisted before they can participate in the staking process and gain rewards.