Lido’s Gain from the Surge in ETH and MATIC Prices

The Surge in Lido’s TVL Amid ETH and MATIC Rally

The recent uptick in staking deposits and the increasing values of ETH and MATIC have significantly contributed to the growth of Lido’s Total Value Locked (TVL).

Lido’s TVL witnessed a remarkable increase of nearly 10% in the past week, primarily driven by the rise in prices of ETH and MATIC, coupled with a surge in staking deposits.

The leading liquid staking protocol for Ethereum, Lido Finance (LDO), observed a surge of approximately 7% in its TVL over the past week.

This surge was attributed to the rise in prices of ETH and Polygon (MATIC) and the notable increase in staking deposits on the Lido protocol.

Between November 27th and December 4th, the values of ETH and MATIC experienced a robust rally of 7% and 6%, respectively.

As of the latest update, Lido’s TVL stands at approximately $21.32 billion, reflecting a notable 25% increase in the last month, according to data from DefiLlama.

Increase in Staking Deposits on Lido

Following a brief period of decline in net deposits to the Ethereum Beacon Chain via Lido, the DeFi protocol regained its position as the protocol with the most staking deposits.

During the seven-day period under review, Lido recorded an inflow of 76,961 in net new ETH staking deposits, as indicated by data from Dune Analytics.

In the last week, Lido accounted for 50% of all ETH deposits made, surpassing Coinbase, which only enjoyed a 17% market share in net deposits during that period.

In terms of outflows, leading cryptocurrency exchange Binance experienced the highest ETH withdrawals in the last week, with 32,000 previously staked ETH removed from the platform, according to Dune Analytics.

The Annual Percentage Rate (APR) earned from holding the protocol’s staked Ether has steadily risen to 3.83% at the time of writing.

Growth in Protocol Deployments on Layer 2 Platforms

Aside from the TVL growth, the protocol’s deployments on leading Layer 2 (L2) platforms also recorded growth, particularly in the amount of bridged stETH.

Data from Dune Analytics revealed a 0.01%, 1%, and 36% increase in the amount of stETH bridged to Arbitrum (ARB), Polygon, and Base, respectively.

On the other hand, Optimism (OP) experienced a 0.37% decline in the amount of bridged stETH during the period under review.

Transaction Fees and Revenue

Transaction fees paid by Lido users in December totaled $11.49 million, generating $1.15 million in revenue.

In November, the staking platform recorded total transaction fees of $62 million and a revenue sum of $6 million.