Liquid staking protocol Lido Finance recorded its highest daily stake inflow on Saturday, with more than 150,000 ether (ETH) staked on the platform.
According to Web3 data analytics platform Lookonchain, Tron blockchain founder Justin Sun staked 150,100 ETH worth $240 million on Lido. On-chain data shows Sun deposited the assets in four separate transactions.
Lido Activates Staking Rate Limit
About four hours after Lookonchain’s tweets, Lido Finance noted that the large inflow caused the protocol to activate its Staking Rate Limit, a safety feature designed to avoid any side effects due to such inflows by limiting the number of staked ETH (stETH) that can be minted in a timeframe.
The platform noted that the limit would affect all parties trying to mint stETH regardless of their approach. It is denominated in ether and so applies to stETH and wrapped staked ether (wstETH).
“It works by decreasing how much total stETH can be minted at any one time based on recent deposits (sliding 24h window), and then replenishing this capacity on a block-by-block basis. Due to the rate of recovery (~6.2K ETH/hr), most users are unlikely to be affected,” Lido said.
Ethereum’s Upcoming Shanghai Upgrade
The latest development, which includes increased ETH staking on the Lido protocol, can be attributed to the upcoming Shanghai upgrade, one of Ethereum’s planned upgrades.
The Shanghai upgrade (EIP-4895) is a fork scheduled to go live in March 2023. It is expected to enable validators and users to unlock their staked ETH and withdraw the assets from the Beacon Chain.
Earlier this month, Lido announced its V2 upgrade, which is focused on enabling stETH holders to withdraw their ETH directly from the Beacon Chain post-Shanghai. The protocol will submit the proposed design on its governance platform soon.