Lido Approves Deployment of Wrapped Staked Ether (wstETH) on Coinbase’s Base Network
In a recent announcement on November 8th, Lido’s governing body approved the deployment of Lido’s Wrapped Staked Ether (wstETH) to Coinbase’s Base network. This means that the token is now live and can be traded or used in decentralized finance (DeFi) applications on the Base network.
Lido is a liquid staking protocol that allows users to stake cryptocurrencies while simultaneously using them in DeFi applications. The protocol achieves this by issuing a derivative token that can be redeemed for the underlying staked asset. For Ethereum’s native coin, Ether (ETH), the derivative token is called “Lido staked Ether (stETH)” and exists on the Ethereum network. However, when stETH is sent to other networks through a bridge, it needs to be wrapped, creating a double derivative token known as “Wrapped Staked Ether (wstETH).”
Before November 8th, there was no official version of wstETH on the Base network. However, on October 17th, Kyberswap announced that the Beefy Finance team had deployed an unofficial version of wstETH on Base. Both teams proposed for the decentralized autonomous organization (DAO) to take control and accept ownership of this version, making it officially endorsed.
The DAO approved the proposal on November 2nd, with 597 million votes in favor and 255 votes against it. This decision marks a significant milestone in scaling wstETH adoption and bridging the gap between scalability limitations and the growing demand for decentralized staking to benefit the broader Ethereum ecosystem.
It’s important to note that while this particular deployment received support from LidoDAO members, not all versions of wstETH have been accepted as official. LayerZero launched a version of wstETH for Avalanche, BNB Chain, and Scroll, which drew criticism from multiple protocols for allegedly being “proprietary.” The DAO is currently debating this version, and no vote has been taken on it yet.
Overall, the availability of wstETH on Coinbase’s Base network is a significant development for Lido and its users. It opens up new opportunities for trading and utilizing staked Ether in DeFi applications, further contributing to the growth and adoption of decentralized staking in the Ethereum ecosystem.