In this week’s space we were joined by Jakov from Lido to discuss the shifting staking landscape and stETH as restaking collateral for rswETH and Swell L2.
Can you describe some of the changes in the restaking market that prompted the Lido Alliance?
“The Lido Alliance is meant to be an umbrella framework to create a Lido family, to address the new things that are happening on the market in the Ethereum ecosystem with the introduction of restaking.
Lido Alliance will bring protocols that are willing to be ‘Lido friendly’ and contribute to the mutual growth of the project, and can apply to join the alliance. Accepted applicants will be responsible for coordinating the proposals of new applications through the DAO, which token holders will have to vote on to either accept or deny Lido Alliance members. The Lido Alliance isn’t live yet as it is still being voted on by the Lido community.“
– Jakov, Lido
What is Lido looking for in LRT partners?
“The main thing is that the LRTs should be permissionless. There are a lot of things with LRTs and restaking protocols that are still moving pieces. As time progresses, less of these things will be abstracted, and the security will be improved in the future. As of right now, everything is reliant on EigenLayer. From a security standpoint there aren't a lot of options, but in the future these things will require proper risk management teams that will propose which AVS’s the specific LRTs should be securing, why they secure that specific LRT and the risks involved in doing so. Hopefully this will be done in a decentralized manner.
As we move into restaking, we are seeing a lot of protocols offer native restaking which I believe makes sense in the beginning. To make the LST scalable, relying on something that is battle-tested and fully focused on the staking infrastructure is much more scalable, and in the long term more secure. It makes sense to support the restaking of Swell ETH (swETH) and Lido Staked ETH (stETH) because these projects are 100% focused on being the best staking middleware.”
– Jakov, Lido
What is Lido’s plan to make stETH popular as restaking collateral?
“Staked ETH (stETH) will stay as a staking middleware as that was always the goal from the beginning, and it still has a very important role in the ecosystem but also in the restaking ecosystem. Switching staked ETH to an LRT would probably attract some users but it would also drop a lot of very important users of Lido’s staking protocol. We will continue to position Lido staked ETH where it should be, and that is as a core piece of infrastructure for restaking and liquid staking protocols.”
– Jakov, Lido
What are Swell’s plans for accepting LSTs with rswETH v2?
“Swell is in the process of finishing the final audits for rswETH v2. With this upgrade we will be able to onboard LSTs in Swell to be restaked into rswETH. Security is our top priority so we are ensuring that the LSTs we onboard have the appropriate security measures in place, as they are essential for both the Ethereum and validation layer.
stETH is the first whitelisted asset that will be accepted as part of our upcoming upgrade and we will continue to build on top of the LST and LRT infrastructure from there. Swell is very much aligned with Lido in terms of decentralization, client diversity, and operator diversity, as well as providing different opportunities with both LSTs and LRTs to cater towards different risk appetites of our users.”
– Chris, Swell
Thanks to everyone who attended the event!
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