Lido presents its largest upgrade – Lido V2

Contributors at Lido have come up with Lido V2, a step to further decentralize Ethereum. Lido V2 is being termed the biggest upgrade to date and an important step in the direction of decentralization. Lido V2 centers around Staking Routers and Withdrawals as the two major upgrades.

Staking Router is a new modular architecture that enables everyone to become a Node Operator. This includes solo stakers as well, who would now be able to ride high on the opportunity of sitting at the table of Node Operators. Staking Router allows all the parties involved – developers, stakers, & NOs – to come together and drive the future of Ethereum in terms of decentralization.

It has been called a major upgrade because it transforms the operator registry into an architecture that is more composable and modular. Several validator pools are getting a chance to become the Node Operator for the first time. This includes DVT validators along with solo validators, for example.

Every module comes packed with a personalized style of working with different elements, namely validator key management, operator registry, and rewards distribution.

This encompasses a diverse validator set while offering the possibility for more than a single approach, technology, and flexibility throughout the protocol. Staking Router basically shifts the Lido Protocol towards an aggregator strategy.

Withdrawals allow the holders of stETH to withdraw directly from the Beacon Chain. Stakers receive ETH in the ratio of 1:1, provided they unstake their stETH. The aim is to provide a smooth experience to users and boost the usability of stETH across the ecosystem of decentralized finance.

Lido V2 is currently undergoing a security audit. The steps that will follow are:

  • Signal DAO voting on the proposed design
  • Running the development in Goerli testnet
  • Deploying contracts to testnet
  • Collecting the Aragon vote before the hardfork

A definite timeline is yet to be shared; however, it has been said that it will be based on the Ethereum upgrade schedule. Audit service providers include ChainSecurity, Sigma Prime, and Statemind, among others.

With Lido V2 in place, external contributors can soon begin contributing to Lido developments irrespective of the corner of Ethereum they belong to. They will only have to propose Staking Router modules, following which anyone will get access to contribute their values. This could be project teams, developers, and researchers.

The mission is to make staking more simple, more decentralized, and more accessible. Lido V2 does that while also driving inclusiveness, openness, and transparency on the platform.

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Lido has published two separate documents for Staking Router and Withdrawals. These can be reviewed on its official website. It rather covers a more technical insight along with feedback accommodated for a high-level overview.

Lido V2 has been introduced ahead of the network Shanghai / Cappella hard fork. It is only a few months away. Until then, Ethereum stakers can access the withdrawal facility if they have supported the network since the first day of the beacon chain and beyond.

David Cox

David is a finance graduate and crypto enthusiast. He projects his expertise in subjects like crypto and Blockchain while writing for CryptoNewsZ. Being from Finance background, he efficiently writes Price Analysis. Apart from writing, he actively nurtures hobbies like sports and movies.

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