Ethereum News Today: Lido's Staking Share Hits Three-Year Low of 25.25% Amid StETH Depegging and Rising Competition

Lido Finance, a dominant player in Ethereum’s liquid staking market, has experienced a significant decline in its staking share, reaching a three-year low of 25.25% as of July 24, 2025, according to data from Dune Analytics [2]. This marks the lowest level since March 2022 and reflects intensifying competition and persistent challenges with the depegging of stETH tokens, which have struggled to maintain a 1:1 ratio with ETH [5]. The drop underscores shifting dynamics in the Ethereum staking ecosystem, driven by user concerns over liquidity and redemption delays.

The decline is attributed to large-scale withdrawal activities by major stakeholders, including entities such as Justin Sun and Ether.fi, which have contributed to an all-time high of 235,728 stETH waiting in Lido’s unfinalized withdrawal queue [5]. Concurrently, Ethereum’s validator exit queue has surged to record levels, with approximately 237,000 ETH queued for withdrawal as of July 24 [4]. This trend aligns with broader market movements, as Ethereum’s price rally to $3,800 in late July spurred profit-taking and increased pressure on staking platforms to process unstaking requests [6].

Lido’s challenges are further compounded by the depegging of stETH, which has eroded user confidence and driven a shift toward alternative staking solutions. The token’s liquidity constraints have also impacted Lido’s native governance token, LDO, which has turned bearish amid prolonged withdrawal delays [5]. Meanwhile, new entrants such as BitMine Immersion are gaining traction, with the latter aiming to stake 5% of Ethereum’s supply as its holdings surpass $2 billion [3]. These developments signal a broader diversification of the staking market, as investors prioritize platforms offering greater transparency and stability.

Despite these setbacks, Lido retains a substantial position in the market, holding over 9 million ETH staked, valued at approximately $33 billion, and offering a 2.8–3% annual percentage rate on Ethereum staking [5]. However, its reduced dominance raises questions about the long-term implications for decentralized finance (DeFi) platforms that rely on stETH as a critical asset, including Aave and Uniswap. The ongoing depeg threatens liquidity across these ecosystems, potentially triggering broader market adjustments [5].

Regulatory concerns have also emerged, with Ethereum co-founder Vitalik Buterin previously warning that concentrated staking power could pose risks to the network’s consensus and governance stability [5]. While Lido’s current market share remains significant, the platform’s ability to address liquidity bottlenecks and restore token peg stability will be critical to retaining users and maintaining its leadership role. Analysts note that the staking market’s evolution highlights growing investor demand for flexibility and reliability, underscoring the need for continuous innovation in the sector [5].

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[2] [Stellar's XLM Price Decline: Reasons for Potential Recovery](https://m.economictimes.com/crypto-news-today-live-24-jul-2025/liveblog/122865756.cms)

[3] [BitMine Immersion Aims to Stake 5% of Ethereum's Supply](https://cryptoslate.com/bitmine-immersion-aims-to-stake-5-of-ethereums-supply-as-holdings-exceed-2-billion/)

[4] [Ethereum Validator Exit Queue Tops $2B as Stakers Rush to Quit](https://cryptoadventure.com/ethereum-validator-exit-queue-tops-2b-as-stakers-rush-to-quit-after-160-rally/)

[5] [LDO Price Turns Bearish as Lido's Unfinalized Withdrawals Hit All-Time High](https://invezz.com/news/2025/07/23/ldo-price-turns-bearish-as-lidos-unfinalized-withdrawals-hit-all-time-high/)

[6] [Ether Stumbles as ETH Validator Exit Queue Hits 18-Month High](https://www.rootdata.com/news/141038)