Lido DAO is preparing to introduce a game-changing governance model that would allow stETH holders to challenge decisions made by LDO token holders.
A final vote, set to conclude by June 30, could usher in a new mechanism that balances power across the platform’s user base.
The proposed system, known as “Dual Governance,” would give stETH users the ability to delay the execution of DAO proposals they find problematic. Unlike traditional timelocks, Lido’s version dynamically extends the waiting period depending on how much opposition the proposal faces. If a significant portion of stETH holders object, delays could stretch up to 45 days — giving users time to exit before a change takes effect.
This flexible approach addresses one of the biggest frictions in liquid staking: users need time to react to governance actions, especially when ETH withdrawal queues can take weeks. Rather than applying a one-size-fits-all delay, the protocol adjusts based on how controversial a proposal is.
The framework has been years in the making. Contributors like Hasu and Victor “kadmil” say the system has been stress-tested, including simulations involving flash loans. Wrapped versions of stETH used in yield strategies aren’t eligible to vote directly, but can be withdrawn to gain voting rights.
By effectively decoupling voting power from execution authority, Lido aims to resolve the long-standing dilemma between trust and liquidity in DeFi governance. The model has already gained early approval in a Snapshot vote and, if passed on-chain, could inspire similar frameworks across other decentralized protocols.
This isn’t just a governance update — it’s a structural shift that could redefine how user protections and protocol upgrades coexist.
Source
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
Source: https://coindoo.com/lido-moves-toward-shared-governance-with-steth-holders/