Lido DAO sees mixed results amid market decline and staking changes

Lido DAO (CRYPTO:LDO), a decentralized finance platform, has faced challenges in the recent downturn of the cryptocurrency market, with its native token LDO dropping by 18% over the past week.

As the broader crypto market saw a 2% decline, confidence in Lido DAO weakened due to prevailing market uncertainty and fear.

Despite the negative sentiment, Lido DAO has reported some positive metrics that suggest potential resilience in its ecosystem.

In the latter half of August, Lido DAO showed growth, as its total value locked (TVL) on the platform increased by 4% between August 19 and 26.

During the same period, staking of LDO on the Polygon (CRYPTO:MATIC) chain grew by 25%, reflecting increased participation in that network.

However, Lido’s performance on the Ethereum (CRYPTO:ETH) network has been less favorable.

The platform recorded a net outflow of 28,160 ETH, valued at approximately $71 million, indicating a significant reduction in staked Ether.

This outflow occurred as the annual percentage rate (APR) for staking on Ethereum fell, likely influenced by a period of low gas fees on the network.

While Ethereum-related activity slowed, other parts of Lido’s ecosystem showed more positive trends.

Ethereum lending activities saw a slight rise, even though liquidity pools and restaking volumes decreased.

Meanwhile, the trading volume for wrapped staked Ether (wstETH) increased by nearly 20% over the past week, demonstrating continued activity on the platform despite market challenges.

Lido’s operations on layer 2 blockchains also grew, with more bridging of wstETH, showing adaptability to current market conditions.

The LDO token has been trading between $0.91 and $1.1, providing limited room for immediate gains but potentially helping to stabilize its price.

The Relative Strength Index (RSI) indicates a gradual shift in momentum, with bullish sentiment slowly gaining after a difficult week for the token.

At the time of reporting, the Lido DAO price was $1.02.