Lido Expands Offerings with Vaults and Earn Products Amid Yield Decline
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Lido DAO has taken significant steps to broaden its services in response to changes in the staking landscape. The organization has officially endorsed a budget of $60 million for the year 2026, aiming to enhance its operations through various innovative financial products.
In a comprehensive plan unveiled through the GOOSE-3 governance proposal, the DAO has set ambitious goals for expanding its liquid staking capabilities. This includes the introduction of yield vaults and enhanced institutional solutions, alongside what Lido refers to as ‘real-business DeFi.’
Lido continues to hold a prominent position as Ethereum’s largest liquid staking provider, controlling approximately 28-30% of all staked ETH. The total value locked in the protocol varies significantly, fluctuating between $18 billion and $40 billion based on market dynamics.
Compounding pressures from an influx of validators have led to a notable compression in staking yields, with base APRs currently ranging from 3% to 5%. This decline has prompted Lido’s governance team to pursue diversification in revenue streams, underscoring a strategic shift to adapt to the evolving market.
The recent launch of Lido V3 and the new stVaults product on Ethereum’s mainnet aims to enhance the platform’s versatility. This upgraded system allows for a modular approach, enabling institutional clients to tailor vaults according to specific needs related to custody, compliance, or yield generation.
Additionally, Lido has rolled out two new earning products—EarnETH and EarnUSD—targeting both retail users and stablecoin holders looking for yields surpassing traditional staking returns. These offerings feature structured yield strategies designed for daily compounding.
The approved budget allocates $43.8 million for core operations and growth initiatives, while reserving $16.2 million for discretionary investments in high-impact projects, including liquidity incentives and product development strategies targeting institutional customers.
On the technical front, Lido plans to enhance its infrastructure with the introduction of Curated Module v2, Staking Router v3, and ValMart, an innovative system designed to optimize validator performance, cost-effectiveness, and decentralization.
In terms of institutional outreach, Vaneck submitted an S-1 filing with the U.S. SEC in October 2025 for a Lido Staked ETH exchange-traded fund (ETF), marking a pivotal move toward conventional financial markets, although the application remains pending as of March 2026.
Meanwhile, in Europe, Wisdomtree has launched a Physical Lido Staked Ether ETP, which is fully backed by stETH and listed on major exchanges. This product began with an initial asset base estimated between $36 million and $50 million.
The DAO’s involvement in industry initiatives like the Crypto Council for Innovation and the Proof of Stake Alliance has facilitated these advancements, with the GOOSE-3 proposal underscoring the need for more ETF and ETP collaborations to connect stETH and stVaults with traditional asset markets.
The vision laid out for the next three years encompasses a shift towards establishing staking as a stable revenue stream while developing innovative products tailored for corporate treasury functions, asset tokenization, and borrowing solutions.
Key performance indicators for 2026 will focus on metrics such as the total value locked in stVaults, contributions from Lido Earn, approvals for ETFs and ETPs, and early results from real-business pilot projects.
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