LDO’s rise in value has not enthused market participants. On-chain volume outperformed in gains, but GitHub contribution declined.

Lido Finance is a popular “liquid” staking service. Users can deposit tokens such as Ethereum, Polygon, Polkadot, and other proof-of-stake (PoS) tokens using the protocol to earn an attractive return on their stakes.

The LDO token is, like many DeFi tokens, a governance token. It allows its holders to vote and make proposals for any changes to the protocol. LDO holders were heavily influential in determining whether the platform should host Terra’s forked protocol after the original went under in May 2022.

Sentiment surrounding Lido Finance [LDO]’s native sample has been largely negative, according to Santiment’s on-chain data. Most recently, the weighted sentiment used to measure average investor sentiment was -0.44.

This happened despite LDO’s performance throughout May. In the last 30 days, the Lido Finance governance token price increased by 15.34%.

Enthusiasm Has Not Yet Peaked

While LDO has experienced significant price appreciation, with a strong performance in price and trading volume, several factors contributed to the prevailing negative sentiment.

A critical concern was the concentration of LDO tokens in the hands of a few large holders, raising questions about decentralization and governance. Such concerns could undermine investor confidence and contribute to negative sentiment about the project.

However, Lido’s social domain had a strong increase since May 31 and has maintained the increase thus far. Social Dominance shows the percentage of discussion around an asset compared to other cryptocurrencies in the top 100 by market capitalization.

Thus, the increase in the metric suggested that LDO was one of the most talked about tokens in the crypto community at press time. However, the growth in the Lido ecosystem has been broader than price action and social activity alone.

As a decentralized finance (DeFi) protocol that allows users to stake their earnings on staked ether [stETH] rewards, the increasing TVL means that investors have increased their appetite for depositing assets into the ecosystem.

Earnings for Incumbents, but Development Stepped Away

Together with the V2 update it also affected the increase in confidence, as well as the walk in STETH.

Despite the chain vote in favor of the update implementation, Lido Finance’s development activity decreased. At press time, the metric had dropped to its lowest state in 2023.

Typically, when development activity increases, the GitHub repositories are inferred to be active. But when it goes down like Lido was, at the time of this writing, it suggested less commitment to updates on the network.

The ratio of daily on-chain transaction volume in profit to loss was 4.08 so far. The metric is calculated as the daily volume on the chain in profits divided by losses.

A high ratio indicates that market participants have made more profits than losses. Regardless of the understanding shown towards LDOs, liquid staking continues to lead smart contract deposits in the DeFi space.

However, the token might need an increase in participation euphoria to impact the token in a positive way continually.

LDO Forecast

According to CryptoPredictions, Lido started in June 2023 at $2,009 and is expected to end the month at $1,780. During June, the expected LDO price maximum is $2,118 and the minimum is $1,440.

Following CryptoPredictions, The LDO price for today (04.06.2023) is forecast to be in the price range of $1,962 – $2,885. The Lido price is forecast to end today at $2,308.

By Audy Castaneda

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