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Today, Lido DAO (LDO) grabbed special attention with its impressive price rise. Its impressive resurgence appears in tandem with other major cryptocurrencies, including Bitcoin and Ethereum.
However, the DeFi token has significantly outperformed the broader crypto market. Let’s examine what the Lido DAO token is and try to understand what’s driving its uptrend.
Why does the Lido DAO price jump up?
With a price increase of 11.60% in the last seven days, LDO has been outperforming the global crypto market, which is up 7.60% today. In the last 30 days, the coin rose by 11.87%, adding a significant value to its price.
At press time at 11:37 AM East Africa Time, Lido DAO was trading at $2.97, 9.02% up in the last 24 hours, according to Coinmarketcap. The token’s trading volume was $148,726,946, representing a 53.40% increase from yesterday and signaling a recent increase in market activity. LDO’s market cap was $2,649,159,695, ranking it the 48th largest cryptocurrency in the entire crypto ecosystem.
The Lido DAO price resurgence coincides with the current net positive inflow into Ethereum’s proof-of-stake system. The latest data shows the Ethereum network generates more than $1 million daily in transaction revenue, up 35% from the previous year. By staking assets on the Ethereum network, participants become validators and, as a result, earn revenue or yield. Today, there are nearly 1 million validators on the Ethereum network.
However, for a user to become a validator on the Ethereum network, he or she has to stake a minimum of 32 Ethereum (ETH) on the platform. Validators play a fundamental role in the proof-of-stake system, as they are responsible for creating new blocks, processing transactions, and maintaining the network’s integrity and security.
However, 32 ETH is a huge investment that small-scale investors can’t afford to invest in the Ethereum network. This is where Lido DAO comes in, allowing users to stake smaller amounts of ETH in Lido pools. In this way, Lido DAO democratizes access to Ethereum staking, ensuring that many people, including retail investors, participate in maintaining the Ethereum network security.
Currently, the net ETH staked with the Ethereum proof-of-stake contract is $31.4 million ETH, underscoring the rising demand for liquid staking service providers like Lido DAO. LDO’s price seems to benefit from this use case.
Lido DAO price forecast
While LDO’s value is in the upward momentum, the current surge of bullish activity raises questions about its future trajectory. Using technical indicators can help to predict Lido DAO’s future direction.
LDO’s RSI is at 45.01, indicating that the Lido DAO market is set to descend to a neutral position in the next few days.
Bollinger bands also confirm a bearish momentum, showing the LDO price moves in the middle, away from the outer bands, representing the bullish trend is about to weaken.
The MACD line is down below zero and crossed from above to below the signal line, indicating that the bullish trend is set to turn bearish.
The Fibonacci retracement chart shows where LDO is likely to lower its price. According to Fibonacci, LDO is likely to lose its momentum and drop to test its support level of $2.628. If the sellers continue to dominate the market, the price will fall further, preparing itself to test its lower support level of $2.234 in the next few days.
Despite the potential short-term volatility, Lido DAO’s liquid staking platform gives LDO a long-term prospect to sustain its price.
However, if the correction fails to happen, LDO will likely continue with the uptrend momentum and climb to its resistance level of $3.143. Furthermore, if the bulls continue to dominate the market, LDO will surge its price and prepare to test its higher support level of $3.365.
What is Lido DAO?
Lido DAO (LDO) is a decentralized autonomous corporation, also popularly known as a decentralized autonomous organization (DAO), which provides a liquid staking solution for several proof-of-stake blockchain networks like Ethereum, Polkadot, and Polygon.
A team of experienced blockchain professionals, including Jordan Fish, Vasiliy Shapovalov, and Konstantin Lomashuk, founded Lido DAO in 2020.
- Lido DAO aims to optimize and simplify the staking process for Ethereum users.
- By serving as a liquid staking platform, Lido DAO allows users to pool their funds to become validators on Ethereum, thus bypassing the network’s prerequisite of investing at least 32 ETH. This enables more people to stake their Ether and participate in the Ethereum network's consensus mechanism.
- Lido DAO runs on the Ethereum network using smart contracts to handle customer deposits and give out potential rewards. Users deposit their ETH into the Lido pools and, in return, receive stETH tokens, which can be used on other protocols or traded on secondary markets.
- Lido DAO’s native token is LDO. The token allows holders to participate in on-chain governance for the crypto project and vote on key decisions like platform updates, new integrations, and board adjustments.
Conclusion
In a week marked by Bitcoin bullishness, Lido DAO has demonstrated its potential, providing unique opportunities and potential gains in the evolving landscape.
