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    Lido stETH Redemption Comprehensive Analysis

    Lido Finance, a decentralized finance protocol, recently enabled withdrawals of Ethereum (ETH) in the form of staked Ethereum 2.0 tokens (StETH). This feature attracted significant attention and led to an impressive rush of StETH redemptions, with $500,000 worth of StETH redeemed in just three hours.

    The role of Lido protocol in the DeFi Ecosystem
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    The Lido protocol is a DeFi solution designed to bring liquidity to staked Ethereum 2.0 tokens. When users stake their ETH in the Ethereum 2.0 beacon chain, their tokens become locked and cannot be readily used or traded. Lido protocol addresses this issue by allowing users to deposit their ETH into the Lido smart contract. In return, Lido issues an equivalent amount of a liquid token called stETH. This enables users to maintain their staked ETH's value while having a token that can be freely transferred, traded, or used as collateral within the DeFi ecosystem.

    The Lido protocol operates through a decentralized network of node operators who handle the process of staking and managing the underlying ETH on behalf of the users. These nodes ensure the security and proper functioning of the staking process. Users who deposit their ETH into Lido also receive a claim on the staking rewards generated by the staked ETH, distributed proportionally to stETH holders.

    By providing a liquid representation of staked ETH, the Lido protocol offers several benefits to the DeFi ecosystem. It allows users to access the benefits of Ethereum 2.0 staking while maintaining liquidity, enabling them to participate in various DeFi applications without waiting for their staked ETH to become unlocked. It also enables stETH holders to earn staking rewards on their holdings, adding an additional source of income.

    Methodology:

    Using FlipsideCrypto datasets for the analysis. Specifically, I use ethereum.core.ez_token_transfers, ethereum.core.ez_hourly_token_prices, and ethereum.core.ez_balances.

    In this dashboard, I conducted an analysis of the recent enabling feature of the withdrawal of stETH, which is the staked version of ETH. I examined the impacts on the market and observed the behavior of users. Furthermore, I assessed Lido's market share in comparison to other platforms. Additionally, I investigated suspicious activities related to Celsius Network following the announcement on May 15th.

    Lido's contract address: 0xae7ab96520de3a18e5e111b5eaab095312d7fe84.