Lido Finance Expands Its Operations to Optimism, a Layer-2 Solution for Ethereum

The liquidity staking platform recently announced that it now supports the deployment of its stETH value-accruing token on Optimism.

DeFi giant Lido Finance continues expanding its footprint. The liquidity staking platform recently announced the deployment of its value-accruing stETH token on Optimism, a layer-2 solution for Ethereum, to enable users to earn daily staking rewards and enjoy a seamless bridging experience while unlocking other multichain opportunities.

The expansion to Optimism is part of Lido Finance's multichain strategy. By offering stETH and wstETH on multiple Ethereum layer-2 platforms, including Arbitrum, the platform provides a more flexible way for users to stake their ETH. Additionally, due to the scaling nature of Ethereum layer-2 solutions, all transactions facilitated by Lido Finance will be cost-effective.

Lido Finance is one of several liquidity-staking platforms that allow users to stake their ETH and earn yields. This capability became possible after Ethereum transitioned from a proof-of-work consensus to a staking system in 2022, following the Merge. The network moved to the Beacon chain, where validators now secure and process all transactions. To operate a full node and compete for part of the 3 ETH block reward and fees, validators need to lock in 32 ETH, a threshold unattainable for many users. Lido Finance addresses this by allowing them to stake ETH without the need to meet this requirement.

As of October 16, data from DeFiLlama indicated that Lido Finance had a total value locked (TVL) of over $25 billion. Over the past year, the protocol has generated over $845 million and more than $1.8 billion since its inception. In addition to securing the Ethereum mainnet, ETH holders of layer-2 solutions such as Arbitrum, Base, Linea, and Scroll can stake directly from these off-chain platforms.

Despite the growth of its ecosystem, Lido Finance’s LDO token prices have been struggling to gain momentum. Even after the gains seen on October 14, the token has yet to surpass the highs of September and has been unable to reverse the losses incurred over the past nine months. After reaching a peak in March, LDO prices have declined by 72%.