Lido Finance, the largest liquid staking protocol, has announced its decision to discontinue staking services on the Polygon network, marking a significant strategic shift for the platform.

Decision Backed by DAO Governance

Community-driven vote seals the move

On December 16, Lido Finance confirmed the decision to sunset its Polygon staking services, following a governance proposal initiated by Shard Labs in 2021. The Lido DAO token holders approved the move after assessing key challenges, including:

• Low user adoption on Polygon.
• Shifting DeFi dynamics affecting liquid staking.
• Polygon’s transition to zkEVM, which has reduced staking activity.

Additionally, the Lido community’s focus on Ethereum has driven this strategic realignment.

Lido Sunsets Staking on Polygon Network

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#Lido, #DeFi, #Polygon

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Lido Finance, the largest liquid staking protocol, has announced its decision to discontinue staking services on the Polygon network, marking a significant strategic shift for the platform.

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Decision Backed by DAO Governance

Community-driven vote seals the move

On December 16, Lido Finance confirmed the decision to sunset its Polygon staking services, following a governance proposal initiated by Shard Labs in 2021. The Lido DAO token holders approved the move after assessing key challenges, including:

• Low user adoption on Polygon.
• Shifting DeFi dynamics affecting liquid staking.
• Polygon’s transition to zkEVM, which has reduced staking activity.

Additionally, the Lido community’s focus on Ethereum has driven this strategic realignment.

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Transition Timeline for Polygon Staking

Key dates and user action required

Lido’s discontinuation process will follow these milestones:

• No new staking allowed: Effective December 16, 2024, Polygon staking through Lido's interface is disabled.
• Unstaking period: A six-month window from December 16, 2024, to June 16, 2025, allows users to unstake stMATIC.
• Temporary pause: Between January 15 and January 22, 2025, operations on Polygon will be suspended, making withdrawals temporarily unavailable.
• Frontend support ends: After June 16, 2025, withdrawals will only be accessible via explorer tools.

The Lido team has advised users to unstake stMATIC before June 16, 2025, to avoid complications.

Lido’s Market Leadership

Dominance in DeFi staking

Despite exiting Polygon, Lido maintains its position as the largest liquid staking protocol, with a total value locked (TVL) of $38.4 billion. For comparison, Rocket Pool and Jito, competitors in the space, manage $2.9 billion and $3.1 billion, respectively.

Implications for Polygon Users

Transitioning from stMATIC staking

Polygon stMATIC holders must act within the unstaking window to ensure a seamless experience. As Polygon focuses on zkEVM development, the exit of Lido may encourage alternative staking solutions on the network.

Lido’s Future Focus: Ethereum

Consolidating efforts on Ethereum staking

Lido’s departure from Polygon aligns with its strategic shift toward Ethereum, where staking demand remains strong. This move allows Lido to concentrate its resources on its core platform while navigating the evolving DeFi landscape.