Lido DAO Plans Token Buyback Amid Market Challenges
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Lido DAO is considering a strategic buyback of its governance token, LDO, to bolster its price during a challenging market period.
According to a recent governance proposal from the Lido Ecosystem Operations team, the organization aims to utilize up to 10,000 stETH, valued at approximately $20 million, from its treasury in this initiative. The decision is described as a response to what the DAO perceives as a notable disconnection between LDO’s current market value and its inherent protocol fundamentals.
The proposed buyback would take place in phases, with each execution involving batches of 1,000 stETH. This method is intended to mitigate market fluctuations, employing either limit orders or a dollar-cost averaging approach. Each series would require approval from token holders before further action is taken.
Lido DAO pointed out that the LDO-to-ETH ratio is currently at historically low levels, trading significantly below its two-year average, specifically about 63% off its median. Despite Lido maintaining the largest market share—approximately 23%—in the Ethereum liquid staking landscape, the LDO token has seen a staggering decline of 95.9% from its peak value of $7.30.
In light of these developments, Lido has reported a revenue decrease of 23%, totaling $40.5 million in 2025. However, the organization asserts that its core operations remain robust despite the decline. Notably, its rewards have decreased by roughly 20%, but operational costs have improved by 13% year over year. Furthermore, Lido’s take rate has increased from 5% to 6.11%, indicating some positive operational momentum in the face of broader market pressures.
The DAO emphasized that the current price dislocation is not aligned with the proportional decline in the protocol’s performance. In this context, the proposed buyback is seen as a means to realign the market perception of LDO with its actual value and operational achievements.
The outcome of this proposal could have significant implications for Lido DAO and its governance token’s market dynamics, potentially restoring confidence among investors and stabilizing the token’s price.
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