Lido’s stETH Token’s Woes Continue as Token Enters Liquidation

The ongoing stEth selloff has accelerated recently, adding to the woes of the largest Ethereum staking platform, Lido. This follows after the Lido stETH token recently de-pegged from ETH and has since been struggling to regain its peg. As a result of the token struggling to re-peg, staked Ethereum tokens from the network are being liquidated.

stETH provides users who are unable to meet the minimum stake requirements of ETH the ability to stake Ethereum. However, the de-peg of stETH from ETH is now causing the stETH token to drop in value.

At the time of writing, the price of ETH is around $1,063.80, a 13.22% drop in price over the last 24 hours, according to CoinMarketCap. Meanwhile, the price of stETH is around $999.28, which is a 14.78% drop in price over the same period. The stETH token has also weakened around 1.69% against ETH over the last day.

To add fuel to the fire, Lido’s staking token is currently in a liquidation process. According to a tweet by blockchain security firm PeckShield, venture capital firm Three Arrows Capital has been offloading stETH. A minimum of 22,830 stETH tokens were converted back into ETH recently, according to the 3AC wallet address.

The co-founder of 3AC, Zhu Su, attempted to alleviate any concern by tweeting “We are in the process of communicating with relevant parties and fully committed to working this out.”