Lido Ends Staking Services on Polygon to Focus on Ethereum

Lido Finance, one of the leading providers of liquid staking solutions, has decided to discontinue its staking services on Polygon.

This move follows a community vote and detailed discussions within Lido’s decentralized autonomous organization (DAO). The decision highlights the challenges Lido faced on Polygon, including limited adoption and a shifting decentralized finance (DeFi) landscape.

Key Reasons Behind the Decision

The vote to end staking on Polygon was driven by multiple factors:

• Low Adoption: User interest in Lido’s staking solution on Polygon fell short of expectations, reducing its utility as a foundational DeFi service.
• Changing DeFi Landscape: Increased focus on zkEVM solutions reshaped the ecosystem, diminishing demand for liquid staking on Polygon’s proof-of-stake (PoS) network.
• High Maintenance Costs: Maintaining the service became resource-intensive, further straining Lido’s ability to operate effectively on the network.
• Competition: The rise of alternative liquid staking platforms within a smaller-than-anticipated ecosystem added to the challenges.

Initially launched in 2021 by Shard Labs, Lido on Polygon aimed to be a major player in the DeFi space. However, it struggled to achieve its goals amid evolving market conditions.

What’s Next for Polygon Stakers?

With the shutdown now confirmed, users holding stMATIC tokens will no longer earn rewards. They can unstake their MATIC via the Lido on Polygon interface until June 16, 2025. After this date, withdrawals will still be possible but only through blockchain explorer tools.

Meanwhile, Lido’s focus is shifting entirely to Ethereum, where it already holds a dominant position in liquid staking. The governance decision aligns with Lido’s strategy to prioritize platforms with higher growth potential and stronger user demand.

This transition underscores the importance of adapting to market dynamics and user needs in the fast-evolving crypto landscape. As Polygon refocuses on zkEVM solutions, Lido is doubling down on its Ethereum operations, aiming to solidify its position as a leader in the liquid staking sector.