Lido Finance Drops Solana Staking After DAO Vote

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The team behind Lido Finance will be sunsetting Solana staking after the community DAO voted in favor of the proposal, with over 90% choosing to discontinue Solana staking. 

The team stated that the sunsetting of the Lido on Solana project will happen gradually over the next few months. 

Lido To Discontinue Liquid Staking On Solana 

The decision to wind down was primarily influenced by the inability of the team to sustain the project, thanks to financial constraints. This means Lido Finance will no longer accept new staking requests for Solana tokens. Lido token holders voted in large numbers to discontinue the service. Following considerable discussions on the Lido DAO forum, token holders decided to end the service on Solana gradually. The decision was announced in a blog posted by the team on Monday. 

“After extensive DAO forum discussion followed by community vote, the sunsetting of the Lido on Solana protocol was approved by Lido token holders, and the process will begin shortly. The Lido on Solana sunsetting comes after a proposal was put forth to the Lido DAO by P2P Validator (the Lido on Solana development team), outlining the achievements, challenges, and future prospects of Lido on Solana.”

The blog post added, 

“Whilst this decision was difficult in the face of numerous strong relationships across the Solana ecosystem, it was deemed a necessity for the continued success of the broader Lido protocol ecosystem.”

According to a snapshot, over 92% of token holders voted in support of sunsetting the Lido on Solana protocol, while 7% voted to provide funding to the project. 

The Phase-Out Proposal 

The decision to phase out Lido on Solana occurred after a proposal was submitted to the Lido DAO by the development team, P2P validator, back in early September. The proposal highlighted the successes, obstacles, and potential future of Lido on Solana. The team also put forth two paths for the DAO to consider. The first proposed to keep Lido on Solana running and fund the project with $1.5 million to sustain operations. The plan called for $200,000 every quarter for development, $600,000 per year for marketing, and $100,000 per year for customer support. This totaled to around $1.5 million over 12 months. 

The second option was to simply end the Lido on Solana project and take it in a completely new direction. However, the team stated that if the community voted to end the project, the team would require $20,000 every month from the Lido DAO for technical maintenance for a period of five months, starting from the 4th of September, 2023. 

SOL Staking Shuts With Immediate Effect 

While the project will be sunsetted in phases, staking on Solana has been discontinued with immediate effect. Node operators can begin to voluntarily off-board starting from the 17th of November, 2023. However, stSOL token holders will continue to receive rewards throughout the duration of the winding down process. Unstaking through the Lido on the Solana frontend will stop on the 4th of February, 2024. Those who miss the deadline will have to unstake their tokens through the Command Line Interface (CLI). 

“In closing, the heartfelt gratitude of Lido on Solana contributors goes out to Solana stakers, builders, and ecosystem partners. This decision does not reflect the belief of Lido contributors on the potential and longevity of the Solana ecosystem as a whole. The journey with Lido on Solana protocol has been momentous, filled with challenges overcome and milestones celebrated. While this marks the end of this particular chapter, the optimism of Lido contributors for the future of Solana remains undiminished.”

Lido Finance had also previously wound down liquid staking on Polkadot and Kusama. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.