Lido Staked Ether (STETH)

Lido Staked Ether (STETH) is a liquid staking token generated when users deposit Ethereum (ETH) into the Lido protocol. This process allows participants to lock up their ETH to help secure and run the Ethereum network while earning staking rewards. Unlike traditional staking where assets remain frozen, Lido mints an equal amount of STETH for every ETH deposited, providing a receipt that represents ownership of the underlying staked asset plus its growing rewards.

Key Characteristics

• Liquidity: STETH functions as a tradable asset, enabling users to move, sell, or utilize the token freely while their original ETH continues to earn in the background.
• Mechanism: The token acts as a digital ticket proving ownership of the savings account and future interest, similar to a bank deposit receipt.
• Utility: It solves the problem of illiquidity in standard staking by allowing the staked value to be spent or used as collateral without unstaking the principal.
• History: Market data for this token was first recorded in 2021.