Lido, the largest of the staking pool for Ethereum and the decentralized autonomous group backing it, is mulling if it should stake or sell its $30M in ETH from the treasury. This scheme was finally submitted on the 14th of this month by the financial unit of DAO, Steakhouse Financial. It considers 4 choices, among which one of them contemplates staking a part or even the total Ethereum on Lido as steETH (Lido staked Ethereum).
A second proposal would see Lido DAO dispose of either the full or at least a part of the 20,304 ETH in exchange for a stablecoin. The plan here is to spread out the runway of the DAO.
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This proposal comes even as ETH staking withdrawals may soon get enabled through the Capella and Shanghai upgrades of ETH. They are expected early in 2023, the Ethereum Foundation revealed.
More Protocol Rewards Expected In Converting Ethereum To Staked Ethereum
The process of converting ETH to Staked ETH may bring in more protocol rewards. But the DAO remains wary of risking it on excessive staking, which may lead to a situation where it might not have enough Ethereum in hand when needed.
Speaking of operating expenditures, Steakhouse Financial has disclosed that there might come the need to swap ETH for a more stablecoin so that there is presumptively a secure extra runway.
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Steakhouse has also revealed that with the current inflow of LidoDAO which is around 1,000 stETH a month, the DAO makes around $1.3M to $1.5M a month with ETH suspended between $1,000 – $1,700 and this has stayed constant for the past several months.
Steakhouse hopes to cover the monthly operating costs. But they are considering if it is right to convert the excess amount of stETH to a stablecoin. This will prepare them to prepare for market conditions and market vagaries that could lead to extra operating expenses.
LidoDAO development executives appeared happy but not thrilled at the present situation of the stablecoin scenario. They said that after taking into consideration all the rumors and the FUD, both DAI and USSDC possess.
