Lido Records Highest Daily Pledge Flow, Implements Staking Rate Limit to Maintain Security

02/25/2023 11:32 • Crypto & Markets • 64 views

On February 25, Lido, the liquidity pledge agreement, announced that the number of pledge ETHs flowing into its platform today exceeded 150000, setting the highest daily pledge flow so far. However, after reaching this number, the platform triggered the security limit function “Staking Rate Limit”. This function is a dynamic mechanism, which can respond to the problem of dilution of pledge rewards due to the inflow of large flow of pledge tokens without suspending pledge deposits, but will reduce the number of cast stETH and then gradually supplement it.

Lido: The highest daily pledge flow has been set today, and the “Staking Rate Limit” limit has been triggered

Interpretation of the news:

Lido, the liquidity pledge agreement, has reported a significant increase in the number of pledge ETH flowing into its platform, exceeding 150,000 on February 25. This marks the highest daily pledge flow in Lido’s history. However, after reaching this number, Lido triggered the security limit function, Staking Rate Limit, to prevent the dilution of pledge rewards and safeguard platform security.

Staking Rate Limit is a dynamic mechanism implemented by Lido, which responds to the problem of dilution of pledge rewards due to large inflows of pledge tokens. The mechanism aims to avoid suspending pledge deposits while reducing the number of cast stETH and gradually supplementing it. Lido’s implementation of this mechanism highlights the platform’s commitment to maintaining security and promoting stable returns for users.

The ETH pledged in Lido is converted into stETH, which is traded on decentralized exchanges (DEXs) and often used to provide liquidity to other DeFi protocols. This, in turn, generates yield for stETH holders, providing them with a safe and secure way to earn returns on their ETH holdings.

Lido has gained popularity in the DeFi sector due to its user-friendly and secure platform. Its liquidity pledge agreement has simplified staking for ETH holders, enabling them to access staking rewards without the need to run complex setups or invest in expensive hardware. Users who pledge their ETH on Lido have the assurance of earning returns on their stETH while retaining the flexibility of their ETH holdings.

In conclusion, Lido’s implementation of Staking Rate Limit is a proactive response to the challenges posed by the inflow of large amounts of pledge tokens. The mechanism aims to ensure platform security and maintain stable returns for users while avoiding disruptions to pledge deposits. Lido’s commitment to securing returns for its users in a user-friendly and secure platform sets it apart from other DeFi protocols.

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