About

This analysis was created by catscatscode (Flipside, Twitter, catscatscode#3578 on Discord) on 8 June 2022 for Flipside Crypto's "stETH Use Cases" Lido bounty.

Introduction

Lido Protocol allows users to stake ETH without locking up access to their liquidity. For each ETH staked, Lido issues 1-to-1 stETH token, which users can utilize for transactions instead of ETH. But are users taking advantage of their reclaimed liquidity, and how?

Methodology

This analysis explores the usage of stETH by type of use case and by top protocols/dapps where users take their stETH tokens.

stETH token contract address 0xae7ab96520de3a18e5e111b5eaab095312d7fe84.

This analysis looks at transactions that occur after stETH is minted, i.e. excluding the transactions from the null (genesis) address.

Usage statistics are aggregated by month since the start of available data.

Data Results

Broadly speaking, most stETH transactions after minting happen on DEXes. The busiest month for stETH usage so far has been May 2022. Since June has recently begun, it is still unclear whether June statistics will be higher than the previous month:

Breaking it down by individual platforms/protocols, most stETH activity has taken place on Curve, which has an incentive program in LDO (the Lido DAO native token) for stETH pools. Other popular platforms include Uniswap, 1Inch, and 0x. Sushiswap's Onsen has dedicated stETH liquidity pools (see Lido blog), but the number of Sushiswap transactions this analysis found is few:

Month by month, stETH transactions peaked in May 2022 on the same platforms mentioned above. In addition, MEV bot use increased in popularity last month. As for use cases that decreased in popularity, FTX had been popular in 2021, especially in October, but now stETH transactions on FTX are much fewer than before: