TL;DR
- Lido has announced discontinuing its staking service for the Polygon PoS chain, following a community vote where 99% of LDO token holders favored the proposal.
- The decision is due to challenges such as low user engagement, inadequate rewards, and the evolving DeFi landscape, particularly the increased focus on zkEVM solutions.
- Users can withdraw their staked MATIC through the Lido interface until June 16, 2025, as Lido refocuses its efforts on Ethereum and other scalable solutions.
Lido, the leading liquid staking protocol, has announced discontinuing its staking service for the Polygon PoS chain. This decision follows extensive discussions within the Lido DAO forum and a community vote, where 99% of LDO token holders favored the proposal. The move marks a strategic shift for Lido, focusing its resources on Ethereum and other scalable solutions.
The Lido on Polygon sunset process has begun.https://t.co/icgidJsbqF
See below for an overview of upcoming timelines and requirements 📆📜
— Lido (@LidoFinance) December 16, 2024
Reasons Behind Lido’s Decision
The decision to phase out the Polygon staking service stems from several challenges Lido faced on the Polygon network. Lido on Polygon debuted in 2021 with high hopes, but it faced challenges such as low user engagement, inadequate rewards, and demanding maintenance needs.
Additionally, the evolving decentralized finance (DeFi) landscape, particularly the increased focus on zkEVM solutions, reduced the demand for liquid staking on Polygon.
Key Dates and Transition Period
The discontinuation process began on December 16, 2024, with the cessation of new staking requests on the Lido for Polygon user interface. Users can continue to withdraw their staked MATIC through the Lido interface until June 16, 2025.
During this six-month transition period, the protocol will temporarily pause operations from January 15 to January 22, 2025, after which withdrawals will resume.
Implications for stMATIC Holders
stMATIC holders will no longer receive staking rewards during the sunsetting process. To ensure a smooth transition, users are advised to unstake their stMATIC and withdraw their funds before June 16, 2025.
After this date, the Lido on Polygon front will no longer support withdrawals, but users can still access their staked funds through explorer tools and other blockchain interaction methods.
Strategic Refocus on Ethereum
Lido’s decision to discontinue its Polygon staking service aligns with its strategic refocus on Ethereum. The protocol aims to concentrate its efforts on scalable and high-demand solutions, leveraging the growing interest in Ethereum’s liquid staking capabilities.
This shift is expected to enhance Lido’s position as a foundational DeFi building block and drive further innovation within the Ethereum ecosystem.
The discontinuation of Lido’s Polygon staking service marks a significant shift in the protocol’s strategy. By refocusing on Ethereum and other scalable solutions, Lido aims to strengthen its position in the DeFi space and continue providing valuable staking services to its users.
