With Lido Finance, you can stake ETH and earn rewards while maintaining liquidity through stETH
Lido
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Rewards
APY
2.9% 4.4%
Details
Rating
7/10
Reward fee
10%
Risk
Low
Unstake period
5 days
Lido makes Ethereum (ETH) staking easy for users. Normally, staking ETH requires at least 32 ETH and technical skills to run your own validator node. With Lido, you can stake any amount of ETH – whether it’s 1 ETH, 0.5 ETH, or even less, without the technical complexities.
When you stake ETH with Lido, you get stETH tokens in return. This is a liquid token meaning you can use it just like any other token while earning rewards. You can trade it, lend it, or use it in other DeFi apps like AAVE or Renzo, all while earning staking rewards in the background.
Lido automatically adds your rewards to your stETH balance every day in a process called automatic compounding. Apart from that, Lido spreads your staked ETH across a network of professional validators. This reduces risks and ensures your funds are managed securely. This type of staking is a simple way to earn staking rewards while keeping your ETH accessible.
Pros & Cons
Low Entry Barrier
You can stake any amount of ETH with Lido. Unlike Ethereum’s 32 ETH minimum, Lido lets everyone participate, no matter how much ETH they own.
Liquidity
When you stake ETH with Lido, you get stETH. You can use stETH to trade, earn more rewards, or participate in other DeFi projects. This lets you stay flexible while your ETH earns staking rewards.
Ease of Use
Lido handles the technical setup for you. You don’t need to run or manage a validator. This makes staking simple, even for beginners.
Centralization Concerns
Lido controls a large share of Ethereum’s staked ETH. This could harm Ethereum’s decentralization if too much power is in one place.
Smart Contract Risk
Lido relies on smart contracts, which can have bugs or be hacked. This creates a risk of losing funds, even though audits aim to prevent this.