Liquid staking protocol Lido Finance activated a protocol safety feature called \u201cstaking rate limit\u201d after more than 150,000 Ether (ETH<\/a>) was staked with the protocol in a single day.<\/p>\n Lido is a liquid staking solution for digital assets, allowing users to stake Ether\u00a0without them needing to have their tokens locked. When a user deposits Ether, Lido issues them a liquid variant of ETH, known as staked Ether (stETH), giving users staking rewards for each day the tokens are held in their wallets.<\/p>\n Lido protocol has registered its largest daily stake inflow so far with over 150,000 ETH staked. <\/p>\n Upon reaching this number, a curious (but important) protocol safety feature called Staking Rate Limit was activated. <\/p>\n Here\u2019s how it works pic.twitter.com\/ngBtWz7q18<\/a><\/p>\n \u2014 Lido (@LidoFinance) February 25, 2023<\/a><\/p><\/blockquote>\n According to the\u00a0liquid staking protocol\u2019s<\/a>\u00a0Feb. 25 tweet, the \u201cdynamic mechanism\u201d was activated after the daily staking limit of 150,000 Ether was reached. <\/p>\n In a related<\/a> guide, Lido explained that the \u201csafety valve\u201d is aimed at limiting the amount of staked Ether that can be minted during high inflows, intended to address any potentially negative effects, such as rewards dilution.<\/p>\n \u201cThis means it is only possible to submit this much Ether to the Lido staking contracts within a 24-hour timeframe,\u201d it explained. <\/p>\n The mechanism works by limiting the amount that can be minted based on deposits within the last 24 hours, replenishing capacity at 6,200 ETH per hour.<\/p>\n \u201cIt works by decreasing how much total stETH can be minted at any one time based on recent deposits, and then replenishing this capacity on a block-by-block basis,\u201d Lido said. <\/p>\n Lido noted the staking rate limit mechanism would affect \u201call parties who may try to mint stETH, regardless of approach.\u201c <\/p>\n Eagle eyed on-chain analyst Lookonchain shared a screenshot<\/a> reportedly showing that the 150,100 ETH may have come from a single user, with three deposits 50,000 each and one of 100. <\/p>\n According<\/a> to Lido Finance\u2019s website, as of Feb. 27, more than $8.9 billion in ETH has been staked with the protocol, up significantly from the $5.8 billion reported on Jan. 2<\/a>.\u00a0<\/p>\n Related: <\/em><\/strong>SEC\u2019s crypto staking crackdown has uncertain consequences for DeFi: Lido Finance<\/em><\/strong><\/a><\/p>\n The latest development from Lido comes as Ether staking volumes have reportedly continued to rise as the Shanghai upgrade nears.\u00a0The Ethereum Shanghai upgrade is due in mid-March, leading to speculation about what could happen to the price of Ether.<\/p>\n One of the five planned upgrades<\/a>, EIP-4895, is expected to unlock staked ETH and allow withdrawals, potentially leading to increased liquidity in the crypto market.<\/p>\n $25 billion of ETH has been staked since the Beacon Chain was launched<\/a> and introduced staking to ETH in December 2020.<\/p>\n<\/div>\n\n
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