Key Highlights
- A one-time $20 million repurchase initiative for LDO tokens has been proposed by Lido DAO, utilizing 10,000 stETH from treasury reserves.
- The governance token currently trades at $0.30, representing a 95.9% decline from its August 2021 peak of $7.30.
- LDO’s ratio against ETH sits approximately 63% beneath its two-year average, signaling what the DAO characterizes as unprecedented undervaluation.
- The repurchase strategy involves executing transactions in 1,000 stETH increments, with each requiring individual tokenholder consent.
- Protocol revenues declined 23% to $40.5 million in 2025, yet Lido maintains its position as the dominant Ethereum staking provider with 23.2% market control.
A new proposal from Lido DAO seeks authorization to repurchase $20 million of its native LDO governance token. The initiative, unveiled Friday, now awaits community voting from tokeholders.
$LDO may have 2 token buyback mechanisms!
One depends on @LidoFinance profits and activates when $ETH is above $3k (max $10m per year).
The second mechanism, a new proposal, is a “manual” LDO buyback with an allocation of 10k ETH = roughly $20m in ETH.
Lido, as a protocol with… https://t.co/gWebrjmznv
— Sholi – real human, not an AI slop bot! (@Sholi_software) March 27, 2026
The initiative requests approval to deploy 10,000 stETH from the organization’s treasury reserves — approximately $20 million at current valuations — for open market purchases of LDO tokens.
According to the DAO, LDO currently experiences one of the most severe valuation dislocations relative to Ethereum throughout its trading history. The LDO/ETH price ratio presently stands at 0.00016, representing a 63% reduction from its median level over the past two years.
Current pricing data from CoinGecko shows LDO at $0.30, marking a 95.9% drawdown from its historical peak of $7.30 achieved during August 2021.
With a market capitalization hovering near $255 million, the token ranks as the 141st largest digital asset by total value.
“That dislocation is not justified by a proportional deterioration in protocol performance,” Lido DAO said in the proposal.
Implementation Strategy for Token Repurchase
Rather than executing a single large-scale purchase, the DAO intends to implement the buyback through incremental transactions of 1,000 stETH each, capped at the total 10,000 stETH allocation.
Every individual tranche requires distinct tokenholder authorization before execution can commence. To minimize market disruption, the DAO indicated it would employ limit order mechanisms or dollar-cost averaging techniques throughout the purchasing process.
Following completion of each segment, performance metrics must be disclosed before initiating subsequent purchases.
An automated repurchase framework was previously suggested in November 2024 but failed to advance to implementation.
Financial Performance Amid Market Position
Lido’s annual revenue for 2025 totaled $40.5 million, reflecting a 23% year-over-year contraction. Staking-related fees, representing the primary revenue stream, decreased 23% to $37.4 million.
While acknowledging the revenue reduction, the DAO emphasizes several metrics suggesting operational resilience. Operating expenses improved 13% annually, while Lido’s take rate — the percentage of staking rewards retained by the protocol — increased from 5% to 6.11%.
Notwithstanding the token’s price deterioration, Lido continues commanding the leading position within Ethereum’s liquid staking ecosystem. Data from Dune Analytics indicates the protocol controls 23.2% of total staked Ether.
This market concentration has previously attracted attention regarding potential centralization vulnerabilities within the Ethereum infrastructure.
The proposal advances to a tokenholder referendum, where LDO holders will determine whether to authorize the initial 1,000 stETH tranche.
