Following Lido Finance’s [LDO] exit from the Solana [SOL] network, community members have proposed sunsetting the liquid staking protocol on the industry-leading Layer 2 (L2) blockchain Polygon [MATIC].
The author of the idea, Kentie, outlined several justifications for the recommendation. The total value locked (TVL) on Polygon is around $86 million, according to Kentie. Additionally, the network brings in $166,863 in fees for Lido DAO annually.
The author contended that the return on investment (ROI) is insufficient given the significant amount of money spent on LDO token incentives during the previous year.
Lido’s Potential Exit from Polygon After Solana Halt,Lido’s Potential Exit from Polygon After Solana Halt
Kentie went on to say that a technical issue that prevented withdrawals from the protocol’s Polygon implementation for 25 days would potentially jeopardise Lido’s reputation.
The proposal said, “Although we were lucky to have no FUD during this time, this seems to pose a reputational risk to a protocol with $15 billion in assets.”
Other arguments put out by Kentie in favour of the sunset of Lido on Polygon were the costly compensation plan for Shard Labs, the ambiguities in Polygon’s vision, and the lack of competition in the platform’s liquid staking market.
Selling things cheaply on a daily basis
As of the time of publication, CoinMarketCap statistics indicated that the price per MATIC coin was $0.5232. Daily traders on the coin’s spot market have been engaging in a pattern of short-selling, as evidenced by price changes seen on a daily chart since October 11.
This was further supported by the True Strength Index (TSI), which measures a trend’s strength.
According to indication readings, on October 11th, the TSI line crossed below the signal line. Since then, it has been placed beneath the signal line. Traders usually wait for this downward crossing to initiate short position openings and profit-taking.
Over the last 10 days, MATIC has seen large sell-offs, with key momentum indicators shown below their corresponding neutral levels. As of the time of writing, the coin’s Relative Strength Index (RSI) was at 48.04. At 34.90, its Money Flow Index (MFI) drew slightly closer to the oversold area.
Lido’s Potential Exit from Polygon After Solana Halt,Lido’s Potential Exit from Polygon After Solana Halt,Lido’s Potential Exit from Polygon After Solana Halt, Lido Coin Crypto news, Lido Coin News