Lido (LDO) to end its project on Polygon, cites various ecosystem issues

The Lido (LDO) community has proposed to end project Lido on Polygon. The proposal highlighted various issues, including Polygon’s unclear roadmap, recent technical problems, and the absence of many staking providers, that triggered this decision.

Meanwhile, the latest proposal from the Lido community comes after the project discontinued Solana staking.

The Lido community released a proposal to terminate the Lido project on Polygon, citing reasons including recent technical issues; uncertainty Polygon roadmap; no other staking providers on Polygon; it is recommended to focus on a native ETH liquid staking provider.…

— Wu Blockchain (@WuBlockchain) October 19, 2023

While Lido has an impressive $86 million total value locked on Polygon, the former’s yearly revenue of $116,863 is a far cry. Also, Lido compensated Shard Labs with massive LDO coins within the past year, raising worries about Polygon’s expensive compensation model.

“Over the last 12 months, Lido has spent at least 2,138,000 LDO ($3,421,600) to get to a state of making $166,683 a year. I am not an active DAO member, but simply a bag holder and this ROI is a sheer waste of LDO/stETH incentives.”

Also, Lido’s latest technical upgrade on Polygon introduced issues that forced the project to suspend withdrawals for nearly a month. While it didn’t see massive FUD, it threatened the billion-dollar firm’s reputation.

Some reasons behind Lido’s worries include Polygon’s uncertain roadmap, intense competition, and the absence of staking providers in the MATIC ecosystem. Also, Stader Labs has executed a 75% cut on its incentives on Polygon.

In that context, Lido might opt for a native Ether staking provider to alleviate some Polygon-related issues.

LDO price

Nonetheless, most investors seem unhappy with terminating Lido on Polygon. For instance, the alt’s price dipped by 3% within the past day to explore a $1.48 low. Also, LDO’s trading volume increased by a mere 6% over the last 24 hours.