Key Highlights
- A $20 million one-time repurchase program for LDO governance tokens has been introduced by Lido DAO, utilizing 10,000 stETH from treasury reserves.
- The LDO token currently trades at $0.30, representing a 95.9% decline from its August 2021 peak of $7.30.
- Current LDO/ETH valuation sits approximately 63% beneath its two-year median level, representing what the DAO describes as an unprecedented market disconnect.
- Implementation would occur through incremental purchases of 1,000 stETH each, with individual tokenholder authorization needed for every batch.
- Revenue for Lido in 2025 decreased 23% to $40.5 million, yet the platform maintains dominance with 23.2% of Ethereum’s total staked supply.
Lido DAO has unveiled a strategic proposal targeting a $20 million repurchase of its native governance token, LDO. The initiative was formally submitted on Friday and has entered the tokenholder voting phase.
The proposal seeks authorization to deploy 10,000 stETH — valued at approximately $20 million — from the organization’s treasury reserves for acquiring LDO tokens through open market transactions.
According to the DAO, LDO is currently experiencing one of its most significant valuation gaps relative to Ethereum throughout the token’s existence. The LDO/ETH exchange ratio presently stands at 0.00016, approximately 63% lower than its two-year median level.
Current LDO pricing sits at $0.30 per token based on CoinGecko data. This valuation represents a 95.9% reduction from the token’s historical peak of $7.30, established in August 2021.
The governance token maintains a market capitalization hovering near $255 million, positioning it as the 141st largest cryptocurrency by total market value.
“That dislocation is not justified by a proportional deterioration in protocol performance,” Lido DAO stated in the proposal.
Buyback Execution Framework
The repurchase program won’t be implemented as a single transaction. Instead, the DAO has structured it to execute through incremental tranches of 1,000 stETH each, culminating in the full 10,000 stETH allocation.
Each individual batch will necessitate independent tokenholder authorization before execution can commence. The DAO has indicated plans to employ limit order mechanisms or a dollar-cost averaging approach to minimize exposure to market fluctuations.
Following the completion of each tranche, comprehensive results must be disclosed before subsequent batches can be initiated.
A comparable automated repurchase framework was introduced in November 2024 but never reached implementation.
Revenue Decline Amid Market Position Retention
Lido’s 2025 financial performance recorded $40.5 million in revenue, marking a 23% year-over-year contraction. Staking fee income, representing the primary revenue stream, declined 23% to $37.4 million.
While acknowledging the revenue reduction, the DAO emphasizes alternative metrics suggesting operational resilience. Operating costs improved by 13% year-over-year, while Lido’s take rate — the portion of staking rewards retained by the protocol — increased from 5% to 6.11%.
Despite the governance token’s substantial price erosion, Lido continues commanding the leading position within Ethereum’s liquid staking ecosystem. Data from Dune Analytics indicates the protocol controls 23.2% of all staked Ether.
This market concentration has previously attracted criticism regarding potential centralization vulnerabilities within the Ethereum network.
The proposal has now advanced to the tokenholder voting stage, where LDO holders will determine whether to greenlight the initial 1,000 stETH batch.
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