Lido Unveils Modular ‘V3’ Upgrade with stVaults to Enhance Institutional and Strategic Ethereum Staking

In recent hours, the price of Lido jumped following a significant upgrade. Lido, the leading liquid staking protocol, has launched Lido v3, an update to provide increased flexibility and composability for institutional Ethereum stakers. According to analysts, this upgrade is major step toward Ethereum staking as US awaits staked ETH ETF approval.

Lido V3 Introduces stVaults

Lido, an Ethereum staking solution, revealed that its latest version, Lido v3, is set to launch this summer, according to an announcement today. The upcoming Lido v3 will feature “stVaults,” modular smart contracts that enhance the flexibility of its liquid staking framework. These vaults will allow users to implement sophisticated staking strategies using Lido’s stETH token.

A primary function of the stVaults includes tailored staking configurations for institutional users, which support compliance requirements and offer operational control. This includes customized validator options and precise deposit and withdrawal procedures.

This initiative shows the increasing interest from institutions in Ethereum staking as financial firms plan for incorporating yield-generating crypto products into their portfolios. The stVaults aim to meet this demand by offering modular components that address various staking requirements.

The team indicated that such customization could enhance validator diversity, which would, in turn, improve network security and trigger competition among validators to deliver superior performance.

Lido dominates the liquid staking market as the largest protocol, securing over $25.5 billion in total value locked (TVL), which represents more than 50% of Ethereum’s liquid staking sector, according to DefiLlama data.

Since Donald Trump won the 2024 US presidential election, there’s been an increase in interest from institutions in Ethereum staking products. This is partly because they expect his administration to be more supportive of cryptocurrency over the next four years.

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Trump Could Accelerate Staked ETH ETF Approval

A Trump administration is expected to be more supportive of cryptocurrency industry innovations, including the launch of the first staked Ether exchange-traded fund (ETF).

Bernstein Research anticipates that under a “new Trump 2.0 crypto-friendly” Securities and Exchange Commission, Ether ETFs will soon include staking yields.

Though sentiment for Ethereum’s ether (ETH) has been low recently, a move by a Trump-related crypto platform might signal a potential turnaround. In January, World Liberty Financial (WLFI), a DeFi platform associated with the Trump family, deposited 10,000 ether (worth $33 million) into Lido Finance (LDO) for staking.

This action raised hopes that regulators might soon approve staking for spot ETH exchange-traded funds (ETFs). Last month, SEC Commissioner Hester Pierce, now head of the agency’s crypto task force, expressed openness to this idea.

The potential regulatory approval could also boost ETH’s price and the value of related ecosystem tokens such as Lido’s LDO.

However, Ethereum has faced criticism due to its declining prices compared to competitors, leadership conflicts, and concerns about its development roadmap. ETH’s value recently fell to a four-year low against Bitcoin and lost trading activity market share to fast-expanding blockchains like Solana.