Emperor Osmo
DeFi Research, Blockchain Metrics, Ex-Osmosis/Artemis
Lido is the levered way to play a flight to safety into traditional liquid staking after the rsETH episode. Capital is rotating rather than simply fleeing: liquid restaking is bleeding while standard liquid staking tokens hold up, with stETH the cleanest expression, and the spread between them should widen as the rsETH saga drags through governance. x.com
Lido DAO's LDO token is not a buy as an Ethereum proxy, even at multi-year lows, because none of Lido's fees accrue to LDO. LDO is down 90% from its 2021 peak while staked assets sit near all-time highs, even though Lido dominates liquid staking at twice the size of its nearest competitor, Eigen, and generated $217M of Q4 fees, 90% of which go to staking rewards and MEV. Aave, Sky or Pendle are better Ethereum proxies. x.com
Lido looks like a DeFi value play because it is effectively an Ethereum treasury company that also earns staking revenue on $20B of assets. Per @A_Leutenegger, its treasury, mostly stETH, is about $157M, sizeable for a token with a ~$300M market cap, while headcount fell 15% and expenses 13% year over year. The protocol earns roughly $1M a week at current ETH prices. The main growth bet is ETH appreciating over the next 5-10 years. x.com x.com x.com
Ethereum is a buy, stake and hold as institutions accumulate and supply tightens. Spot ETF holdings rose from 3% to 10% of supply in a year, treasury vehicles keep stacking, 30% of ETH is staked, exchange balances keep falling and fee burns offset issuance in busy periods. Most stablecoin and tokenized-asset activity routes through Ethereum and its L2s, and staking pays about 3%. Institutional tokenization will happen, perhaps outside the US first. The Wave 3 target is $9,200. x.com
Aave's current turmoil is short-term, but how it handles new bad debt and the V4 rollout will define market confidence for the rest of the cycle. Core contributors BGD Labs, ACI and Chaos Labs have all left amid disputes. An oracle glitch caused about $26-27M of liquidations, and an attacker used rsETH from the $293M Kelp DAO exploit as collateral to borrow about $196M of WETH, leaving that much bad debt and frozen rsETH markets. TVL fell about $9B and AAVE dropped 22%. x.com
