Network News: Lido Finance Faces Growing Pains and Suspicion

Amidst Waning Demand, Cracks Emerge in Ethereum Staking Market

Ethereum staking demand wanes, cracks appear

Rewind to earlier this year, when staking on the Ethereum blockchain was all the rage. Traders flocked to Lido Finance, a decentralized protocol that allowed them to earn rewards from staking Ethereum and trade a liquid proxy token called “stETH” in the meantime. Lido quickly became the top-ranked project in the DeFi space. But lately, Lido has been experiencing some growing pains, suspicion, and resentment. Let’s dive into the details in this week’s Network News.

Stellar’s “Soroban” Project Gains Momentum, Job Cuts Continue, and Scroll’s New Layer-2 Network Goes Live

In addition to the buzz around Lido Finance, there are a few other noteworthy updates in the blockchain world. The Stellar project’s “Soroban” is drawing closer to fruition, posing competition to Ethereum and other smart-contract blockchains. This development could bring fresh momentum to the XLM token. Meanwhile, job cuts continue to plague the blockchain sector as the crypto winter persists. On a more positive note, Scroll’s new layer-2 network has gone live, adding to the competition for Polygon and Matter Labs’ “zkEVM.”

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PEAK LIDO? Ethereum’s Staking Giant Faces Challenges

Lido Finance has been the talk of the town as Ethereum transitions to a proof-of-stake blockchain. The project allows investors to stake their ETH and earn rewards while trading the stETH token. It’s been a hit, with many finding it more attractive than the cumbersome task of setting up their own validator. However, Lido’s popularity has become a double-edged sword. Approaching the 33% threshold of total ETH staked, Lido risks threatening the supermajority needed to finalize transactions. This has sparked pushback from the crypto community and highlighted operational issues within Lido’s sprawling operation. Despite the challenges, defenders argue that Lido contributes to Ethereum’s decentralization and points out that the real threats come from centralized players. As the Ethereum immune system wakes up, Lido is navigating the rocky waters of success.

MAWR JOB CUTS: Crypto Winter Takes Its Toll

Job cuts continue to make headlines in the blockchain industry, signaling the economic toll of the ongoing crypto winter. CertiK, a blockchain code auditor, recently made significant workforce adjustments, impacting a substantial portion of their team. Parity Technologies, a leading developer of the Polkadot blockchain, is also facing staffing changes as it adjusts to market conditions. The overall decline in transactions and the challenging venture fundraising environment put pressure on founders and companies in the blockchain space. It’s a tough period, but as they say, the strongest survive.

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The Tether Freeze and Other News Bites

In other news, Tether made a bold move, freezing 32 blockchain addresses linked to terrorism and warfare in Israel and Ukraine. The U.S. Treasury Department also targeted a Gaza crypto business, squeezing Hamas. Uniswap Labs, the company behind decentralized exchange Uniswap, announced a 0.15% fee on certain token trades to sustainably fund their operations. THORSwap, used by FTX Exploiter, resumes trading after excluding U.S.-sanctioned countries from its terms. Spot bitcoin ETF approvals could potentially add $1 trillion to the crypto market cap, according to CryptoQuant. And finally, luxury sports car maker Ferrari is now accepting crypto payments in the United States, with Europe to follow suit. If you’ve been dreaming of buying a Ferrari with your Bitcoin gains, your dreams might just come true.

Protocol Village: Tech Upgrades and Developments

Let’s take a closer look at the latest advancements in the blockchain tech world.

1. Scroll, a contender in the zkEVM race, has officially launched its main network. Competing with the likes of Matter Labs and Polygon, Scroll offers a fresh alternative to Ethereum’s layer-2 networks.
2. Helix, a decentralized orderbook exchange built on the Injective blockchain, is set to launch its Pre-Launch Futures. This move will grant the general public access to the Celestia (TIA) token, introducing new opportunities in the perpetual market.
3. Ether.fi, a DeFi protocol that raised $5.3M in a seed round, has rolled out a liquid staking token called “eETH.” With eETH, users can stake their ETH, accrue staking rewards, and automatically reinvest in EigenLayer.
4. Binance Labs, the venture capital arm of Binance, has invested in Initia, a network designed for highly interwoven modular rollups. Utilizing Cosmos with application-specific L2s, Initia aims to take the blockchain tech to new heights.
5. Blockstream has unveiled its highly anticipated “Lightning-as-a-Service” solution, Greenlight, at BTC Amsterdam. This innovative service promises to revolutionize the Lightning Network and enable lightning-fast transactions.

Money Center: Fundraisings and Token News

Let’s take a peek at recent happenings in the world of fundraising and tokens.

• Methodic Capital Management has launched the Methodic CoinDesk ETH Staking Fund, allowing professional investors to benefit from both the total return of ETH and staking rewards.
• Account Labs, a Singapore-based wallet provider, has announced a $7.7 million funding round led by prominent investors. This investment will further fuel the company’s mission to provide top-notch services.
• Reddit-based tokens took a dive after reports of the winding down of community points. FTX’s bankruptcy estate stakes $150M SOL and ETH as the legal battles continue. Binance burns 2.1 million BNB tokens, worth a staggering $450M, in their quarterly move. Additionally, the BOND token skyrockets after BarnBridge votes to comply with the SEC.

Ethereum Validator Backlog Clears Out as Staking Demand Weakens

Just a few weeks ago, we reported on the concern surrounding the growing number of validators waiting to join the Ethereum blockchain. However, recent developments show that the backlog has nearly cleared out. Coinbase analysts attribute this to a plateau in investor demand for Ethereum staking. Staking rewards have dropped, and the number of stakers has increased, resulting in a less enticing return on investment. In a world where traditional money market funds and U.S. Treasury bills yield north of 5%, a 3.5% return seems less appealing.

Calendar: Upcoming Blockchain Events

Mark your calendars for these exciting blockchain conferences and events:

• Oct. 12-13: Bitcoin Amsterdam conference.
• Oct. 19-21: xDay conference on blockchain, metaverse, and AI in Bucharest.
• Oct. 20-21: Plan B forum in Lugano, Switzerland.
• Oct. 25-26: European Blockchain Convention in Barcelona.
• Nov. 2-4: Cardano Summit in Dubai.
• Nov. 7-10: NEARcon in Lisbon.
• Nov. 8-9: Binance Blockchain Week in Istanbul.
• Nov. 13-19: Devconnect in Istanbul.
• Nov. 15-17: North American Blockchain Summit in Fort Worth, Texas.
• Nov. 28: EOS native consensus upgrade with “instant finality.”
• Dec. 1-3: Africa Bitcoin Conference in Ghana.
• April 2024 (estimate): Next Bitcoin halving.
• April 8-12: Paris Blockchain Week.
• May 29-31, 2024: Consensus in Austin, Texas.
• July 25-27: Bitcoin 2024 in Nashville.

Enjoy the exciting world of blockchain and make the most of these upcoming events!

This lively edition of Network News has covered the trials and tribulations of Lido Finance, the evolving blockchain landscape, and the latest technological advancements. Stay tuned for more thrilling updates. And remember, even in the world of digital assets, laughter is the best investment. Happy investing!

This article was brought to you by the humorous and professional mind of a Blockchain technology and Digital investment expert.

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