- Lido announced a new upgrade that would improve the user experience for Solana strikers.
- Despite new upgrades, the number of users of the protocol continued to decline.
In an announcement on Dec. 21 Lido Finance [LDO] stated that it has made new upgrades to its technology.
Lido updated to V2 on the Solana [SOL] network. But despite these changes, Lidos market conditions still looked weak.
Lido on Solana v2 is live!
We have successfully updated the protocol to v2 with the main change being the removal of the special 100% commission in favor of public validation nodes with a maximum commission of 5%.
A new chapter is opening.https://t.co/Jy34HgV2zV
— Lido (@LidoFinance) December 21, 2022
Read Lidos [LDO] Price prediction 2023-24
New changes in Lido Finance
This new update would remove 100% of all commission nodes from the pool. In addition, it would improve the status of validators on Lido, as they would receive both their block rewards and staking rewards in SOL instead of stSOLb (Staked Sol).
The Lido network would be more secure for users wanting to deploy their SOL and more profitable for node operators.
Although Lido’s team was constantly changing protocols, there were still areas where Lido needed to improve.
For example, the APY (annual percentage yield) for Lido decreased significantly in the past. The data from the Dune Analytics dashboard showed that the APY generated by Lido for its users had dropped from 5.42% to 3.99% at the time of writing.
This falling APY could be a reason why the number of unique users on the Lido protocol decreased. According to data provided by Messarithe number of unique users on the Lido protocol was down 20.86% in the past 30 days.
The dwindling number of users of the protocol ultimately affected the revenue generated by Lido. Total revenue was down 18.82% and at the time of writing, the protocol’s total revenue was $26.56 million.
Source: Dune analysis
The market responds
A consequence of the above developments could be that the interest of large addresses in LDO is declining.
According to data from Santiment, the percentage of LDO owned by large addresses has dropped dramatically over the past month. This coincided with the price drop of LDO, which could have been caused by the sale of LDO by large addresses.
In addition to major addresses on the Lido network losing their trust in LDO, new addresses also lost interest in the token.
How many LDOs can you get for $1?
This was evidenced by the declining network growth of the token, which slowed significantly over the past week. It suggested that the number of times new addresses were transferred LDO for the first time had decreased.
Source: Sentiment
However, it remains to be seen whether Lido Finance’The new updates to the protocol can help the protocol solve its problems.
At the time of writing, LDO was trading at USD 0.912. According to CoinMarketCap, the price was down 4.93% in the past 24 hours.
