Hasu, strategic advisor to Lido, and Tarun Chitra, founder of Gauntlet, explain everything about staked ETH, aka stETH, how it should be priced, Lido’s market dominance, and much more. Show highlights:
- the role of Lido, what stETH is, and what its benefits are
- whether Ethereum’s lack of delegated proof of stake contributes to the need for stETH
- why stETH is not mispriced and why it doesn’t necessarily have to be worth 1 ETH
- the inherent risks associated with stETH
- how there was not enough liquidity to handle all the liquidations, especially in automated vaults on, for instance, Instadapp
- how automated market makers work and what Curve’s amplification factor is
- whether 3AC and Celsius had a significant impact on the stETH/ETH “de-peg”
- how does the Merge affect the liquidity of stETH
- Hasu’s and Tarun’s level of confidence that the Merge will happen this year and whether it will be a success
- what will happen to the price of stETH after the redemptions are enabled
- why Lido has achieved such a level of dominance
- how Lido decreases the cost of staking and helps improve the security of the Ethereum blockchain
- whether there is going to be a “winner take all” in the liquid staking derivatives market
- how liquidity fragmentation can cause the system to blow up
- why LDO tokenholders might not have the same incentives as ETH tokenholders
- what is Lido’s new dual governance model and what is it trying to achieve
- whether Lido should self limit its market dominance
- how Lido coordinates validators and the role of the LDO token in this coordination
- what are the lessons to be learned from the stETH situation
- how governance is a liability to DeFi protocols
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Crypto.com: https://crypto.onelink.me/J9Lg/unconfirmedcardearnfeb2021
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EPISODE LINKS
Hasu:
Tarun:
stETH
Lido
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