Celsius Network, one of the leading DeFi platforms that offers borrowing and lending services, has added over 428,000 stETH tokens to Lido’s lengthening withdrawal queue. This move represents the latest development in the increasing demand for Ethereum’s proof-of-stake (PoS) chain, which is experiencing considerable growth in recent months.
What are stETH Tokens?
Firstly, it is important to understand what stETH tokens are and their significance. stETH is an ERC-20 token that represents staked Ethereum on the Lido platform. It allows users to earn rewards while staking and provides liquidity to the staking ecosystem through trading on decentralized exchanges (DEXs).
Lido is a decentralized protocol that allows users to stake their Ether on the Ethereum 2.0 blockchain without having to maintain their own node. Instead, Lido pools their users’ funds and stakes them on the network to earn rewards.
With stETH tokens, users can participate in Ethereum staking without having to hold the actual Ether for staking. Instead, they can buy, sell, or trade the stETH tokens on DEX platforms such as Uniswap, Sushiswap, and Balancer.
Celsius adds over 428K stETH to Lido’s Withdrawal Queue
Celsius Network recently joined the long queue of participants who are staking Ethereum with Lido. The platform announced that it would be adding over 428,000 stETH tokens to Lido’s withdrawal queue. This move will help to increase liquidity, and it is an excellent way for Celsius users to earn passive income while contributing to the growth of the Ethereum 2.0 network.
The decision to stake with Lido is an indication of the increasing interest in Ethereum staking, which has been driven by the high yields and potential earnings for users. Celsius is part of an increasing group of DeFi platforms that are recognizing this opportunity in staking and offering their users the chance to get involved.
Why Ethereum Staking is Growing in Popularity
Ethereum staking has become popular due to the substantial returns that users can expect to earn. Ethereum 2.0 operates on a PoS consensus mechanism, which means that users can earn rewards by staking their Ether. The more Ether you stake, the higher the rewards you earn.
Furthermore, stakers can earn interest on their staked Ether and staked tokens. Typically, the interest rates vary based on the Ethereum network’s usage and the demand for staking services. Currently, stakers can earn between 5% and 8% in annual yield.
Ethereum 2.0 is also expected to boost the speed and scalability of the network, making it faster and more efficient. This development could lead to the creation of more decentralized applications and improve the overall DeFi experience.
Celsius Network’s Role in the Growth of Ethereum Staking
Celsius Network has been at the forefront of offering DeFi services to its users. With the addition of stETH tokens to Lido’s withdrawal queue, its users can participate in Ethereum staking without needing to hold Ether directly.
Furthermore, Celsius is planning to offer Ethereum staking services directly to its users, allowing them to earn returns while contributing to the growth of Ethereum 2.0. The platform aims to offer its users a secure and profitable way to participate in this new market while providing liquidity to the staking ecosystem.
Celsius Network’s decision to add over 428,000 stETH tokens to Lido’s withdrawal queue is a strong indication of the growth of Ethereum staking in the DeFi market. With the potential for high yields and expected improvements in Ethereum 2.0, staking has become a popular market for investors and platform providers.
Celsius has positioned itself as a player in this new market, allowing its users to participate in Ethereum staking and earn passive income. As more users get involved, the Ethereum network’s security and scalability could improve, leading to the creation of more decentralized applications and strengthening of the DeFi market.
Crypto-lending firm Celsius has requested the withdrawal of its staked Ether (ETH) investment, worth $784.7m at current prices, from liquid staking platform Lido. The firm is anxious to recover the stash, which will be converted back into Ethereum tokens upon completion of the withdrawal process and burn of the stETH tokens by Lido. According to Dune Analytics, the cumulative amount of stETH in the withdrawal queue is 442,000 from 141 requests and is valued at around $808m, with Celsius responsible for the majority of it. While Lido claims it has enough ETH in its buffer to handle the Celsius requests, larger numbers of withdrawal requests could affect the network withdrawal queue. Staking platform Lido recently enabled withdrawals, and research analyst Tom Wan has suggested that unstaking requests exceeding 10% could cause a larger number of validator exits leading to longer withdrawal queues. Celsius may use the capital as part of its restructuring efforts or to help pay off its $4.7bn debt to creditors.