09 March 2023 00:42, UTC
Reading time: ~2 m
In the proposal, decentralized finance applications developer firm and Lido partner MixBytes announced it would stop developing and providing technical support to Lido on Polkadot and Kusama liquid staking protocols as of August 1, 2023.
“The decision was made because of several challenges, including market conditions, protocol growth, limited capacity and priority alignment,” Kosta Zherebtsov, chief product officer of MixBytes and the author of the proposal, said.
Staking is a popular yield-earning strategy in the digital asset space, where crypto holders can lock up and delegate their tokens such as ether (ETH) to secure proof-of-stake blockchains in exchange for a reward. With liquid staking, investors can keep their capital liquid and use their staked tokens as collateral by receiving derivatives.
The proposal may affect some $25 million of assets. Data aggregator DefiLlama shows that investors have staked $22.3 million worth of DOT and $2.34 million of KSM, the native tokens of Polkadot and Kusama, on Lido.
Zherebtsov suggested halting acceptance of new DOT and KSM for liquid staking by March 15, and automatically unstaking tokens later in June, according to his proposed timeline.
The proposal is in a preliminary discussion stage yet.
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