Lido Finance: Deep Dive into Staking Success, Price Dynamics

Lido Finance (LDO), one of the most sizable liquid staking initiatives in the cryptocurrency sector, has maintained its position at the top of the blockchain. This is due, in part, to the fact that it provides its users with a staked ETH token known as Lido stETH to initiate the staking process.

Users can stake any quantity of ETH with Lido stETH, as opposed to the fictitious 32 ETH required on the Ethereum Mainnet. The exponential expansion of Lido in the staking industry is a direct consequence of this.

However, beyond activity and adoption, Lido has also benefited from additional metrics.

In the past week, assets under management (AuM) on the Lido network have increased by 37.31%, as reported by Staking Reward.

The AuM was valued at $18.64 billion as of press time. Consequently, some quarters have speculated that the AuM could shortly reach a valuation of $100 billion.

The AuM monitors the performance of funds allocated to an initiative. One potential factor contributing to the substantial growth of the AuM on Lido is its net staking flow. The seven-day net staking volume on Lido has increased by $310.95 million as of the time of writing.

The recent increase in staking activity has added more liquidity to the Lido pools. Additionally, it serves as validation that users have faith in the security and benefits offered by the protocol.

Regarding its native token, LDO appears to correlate significantly with the price movement of ETH. This was apparent in the token’s motion on November 9, when BlackRock filed for an Ethereum ETF. ETH moved approximately $2,000 then, and LDO followed suit by surging above $2.

At the time of writing, the LDO price stood at $2.26, signifying a surge of 2.26% over the preceding week. The LDO/USD 4-hour chart, on the other hand, revealed that the era of ascending green bars had ended.

On November 12, there was significant profit-taking of approximately $2.32, as shown in the chart below. The price of LDO fell to $2.22 shortly after that. However, investors appear intent on propelling LDO back above $2.30.

The resultant purchasing pressure at $2.26 was evident.

As illustrated previously, the 9-day EMA (blue) had surpassed the 20-day EMA (yellow). When applied to a short-term trading strategy, this signifies a favorable trend. If purchasing pressure were to increase, LDO might cease its correction and instead aim for $2.35.