Lido Finance to End Operations on Solana: Details

Lido Finance, a provider of liquid staking solutions for proof-of-stake cryptocurrencies, has made the announcement that it will discontinue its operations on the Solana blockchain. 

Lido Cites Two Reasons for Ending Operations on Solana

As per the report, Lido’s peer-to-peer team initiated a proposal to discontinue Lido on Solana on September 5 due to financial unsustainability and low fee earnings. This choice was reached through a community vote within the protocol’s decentralized autonomous organization (DAO). 

Voting Began On September 29

The voting process started on September 29 and concluded one week later on October 6. In a post by the the DeFi protocol on October 16, it noted: “After extensive DAO forum discussion followed by community vote, the sunsetting of the Lido on Solana protocol was approved by Lido token holders and the process will begin shortly.”

Lido to Stop Accepting Staking Requests

Lido has confirmed that, following the implications, it will no longer accept staking requests starting from October 16. The process of voluntary node operator off-boarding is set to commence on November 17, and Lido users are required to unstake their assets on Solana’s frontend by February 4. It states: “After this date, unstaking will need to be done using the CLI.”

The P2P team invested approximately $700,000 in Lido on Solana since the takeover in March 2022. They generated $220,000 in revenue but ended up with a net loss of $484,000, as reported by the proposal’s author, mediakov.

Solana in Trouble?

Solana (SOL) appears to be dealing with a persistent set of challenges. Earlier this year, the Solana network encountered significant network disruptions. Following this incident, the prominent exchange Bitstamp declared its intention to temporarily suspend trading of Solana (SOL). 

Bitstamp’s decision in August was prompted by the dynamic changes in regulatory conditions that could have consequences for Solana (SOL). In addition to Bitstamp, Cardinal has also announced its decision to halt operations on Solana due to the difficult economic conditions.