Lido reported $40.5 million in revenue for 2025, down 23% year-over-year. The decline reflects shifting dynamics in Ethereum staking as yields compress and capital moves to alternative products.
The protocol, which generated $52.4 million in 2024, attributed the drop to lower staking rewards and net outflows of user funds. Gross revenue fell 18.2%, according to its annual report. Lido also noted a contraction in its core market segment, particularly among simple liquid staking token (LST) users.
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Is Ethereum Staking Entering A Lower-Yield Phase?
Lido said network-wide annual percentage rates (APR) declined across Ethereum, reducing returns for participants. At the same time, capital rotated toward exchange-based staking and institutional offerings with lower perceived risk. The protocol also faces competition from liquid restaking providers that attract users with token incentives.
The shift marks a structural change in staking behavior.
“2025 unfolded under a structural shift in Ethereum staking,” Lido stated, pointing to intensified competition and declining demand in its core segment.
The Simple LST category, once its primary growth driver, continued to lose share as users explored higher-yield or institutionally managed alternatives.
Lido is responding with strategic adjustments. The protocol is considering an LDO token buyback program, potentially launching in the second quarter. Under the proposal, staking rewards would be used to purchase LDO tokens on the open market and deploy them into liquidity pools. The move aims to support token value while reinforcing ecosystem liquidity.
The organization has also taken cost measures, including a 15% workforce reduction in August, and is expanding its product suite. New offerings are targeting institutional users and higher-yield strategies. Partnerships are emerging as well, including a WisdomTree exchange-traded product in Europe that integrates Lido staking.
The evolving staking environment raises questions about long-term positioning. Can Lido maintain leadership as capital shifts toward institutional and incentivized alternatives? The next catalyst will be execution on new products and whether staking flows stabilize as Ethereum yield conditions adjust.
