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Ethereum Staking Provider Lido to Incorporate NFTs Into Unstaking Process
Users will receive a transferable non-fungible token representing their request withdrawal for their staked ether.
Updated Mar 28, 2023, 9:12 p.m. Published Mar 28, 2023, 8:26 p.m.
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Lido, the largest decentralized finance (DeFi) protocol by total value locked, unveiled plans during its Node Operator Community Call #5 to release a non-fungible token (NFT) representing a user’s withdrawal request amount as part of the process of unstaking their ether . These withdrawals will be enabled after the Ethereum blockchain undergoes its next major upgrade, Shanghai (also referred to as Shapella by developers), next month.
Ether withdrawals on Lido, where users can unstake their stETH and receive ETH at a 1:1 ratio, will have two steps: request and claim, according to Mariya Muzyko, product manager at Lido, during the call Tuesday afternoon. Once a user requests a withdrawal, they will receive a Lido-issued NFT representing their withdrawal request. The user can then use the NFT to claim their ETH rewards. The NFT is burned after the user redeems and claims their ETH.
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Lido was the first to provide access to liquidity to ETH holders who wanted to stake their tokens by issuing a derivative token, stETH. This token represents the combined value of the user’s initial deposit plus accrued interest and can be used across many DeFi platforms. The introduction of an NFT into the request withdrawal process represents another first of its kind.
Each withdrawal-request NFT will be transferable, which means users can transfer the NFT to another address, giving this new address the right to claim the corresponding ether rewards. If a user decides to sell their NFT on secondary markets, Lido said it will not take a royalty percentage from the sale.
Withdrawal periods will take roughly one to five days to process, depending on the amount of stETH in the withdrawal and the number of total requests, according to the community call.
Read more: Ethereum’s Shanghai Hard Fork Now Has Official Target Date
Update: Tuesday, March 28, 2023, 20:39 UTC: Adds information about the Shanghai update in the first paragraph.
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