Lido’s Market Cap – Is It A Bubble? To examine the factors that play a role

  • Lido’s market capitalization increase may not be sustainable due to the protocol’s declining performance.
  • The low APR, number of users, and voting interest may affect Lido’s long-term success.

Lido’s market capitalization has increased significantly in recent days, according to new data from Messari. The growth in market cap has been attributed to the hype surrounding the upcoming Shanghai Hardfork on Ethereum.

But this peak in market capitalization may not be sustainable in the long term.


Read Lido price predictions 2023-2024


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Over the past 14 days, Lido’s market capitalization has increased by 47.7%. However, in recent months, the actual rate offered by the Lido protocol to its users has been steadily declining.

This decline in annual percentage rate may affect the interest in the Lido token. why? Well, of course, because it would be less attractive for users to invest their assets in Lido, which could lead to a decrease in TVL in the long run.

Source: Dune Analytics

In fact, Lido’s TVL has increased significantly in the past month, but a drop in annual percentage rate (APR) could cause users to move away from the protocol, which could in turn affect Lido’s TVL in the long run.

Source: Devi Lama

According to Messari, the number of unique users on the Lido protocol has decreased by 9.80% in the last 30 days. While revenue from Lido continued to increase, it increased by 7.9% over the same period. Notably, the continued decline in the number of unique users could also affect Lido’s revenue as well as TVL over time.


What is 1,10,100 LDO worth today?


The whales swim away

Meanwhile, despite the growth in LDO’s market cap, whales are starting to lose interest in the token. According to Santiment, the percentage of large addresses containing LDOs has decreased over the past month. In fact, the LDO network growth metric reading also decreased.

In addition, the activity of the token decreased when the speed of the token dropped sharply. The decrease in speed indicates that the frequency with which the LDO token is exchanged between addresses has decreased over time.

Source: feeling

In short, Lido’s peak in market capitalization may be short-lived. At the time of publication, LDO is trading at $2.32 and its price is up 0.27% in the last 24 hours.

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