Lido Launches V3 Whitepaper with stVaults for Customizable Staking

Lido V3 Whitepaper is now live and open for feedback. Lido V3, launched in February 2025, improves the current protocol and introduces stVaults: a staking primitive that supports building non-custodial, permissionless, and customizable staking products, enabling on-demand liquidity backed by stETH. While the V3 concept has been finalized, key pieces are still a work in progress. Contributors are specifically seeking feedback on stVault design and risk management to balance the risk profile and redeemability of stETH with validator-driven operator selection, reserve ratio, and risk levels.

This development marks a significant step forward for Lido, as it aims to enhance its staking protocol by introducing stVaults. These stVaults are designed to provide a more flexible and customizable staking experience, allowing users to build non-custodial and permissionless staking products. The introduction of stVaults is expected to enable on-demand liquidity backed by stETH, which is a staked version of ETH that represents the user's staked ETH and the rewards accrued from staking.

The launch of the Lido V3 Whitepaper comes at a time when the demand for decentralized finance (DeFi) solutions is on the rise. The ability to stake ETH and receive stETH in return has become an attractive option for many users, as it allows them to participate in the Ethereum network's consensus mechanism while still maintaining liquidity. The introduction of stVaults is expected to further enhance this experience by providing users with more control over their staking activities and the ability to customize their staking products to suit their specific needs.

However, the development of Lido V3 is still a work in progress, and contributors are seeking feedback on key aspects of the protocol. Specifically, they are looking for input on the design of stVaults and risk management strategies. The goal is to balance the risk profile and redeemability of stETH with validator-driven operator selection, reserve ratio, and risk levels. This feedback is crucial for ensuring that the final product is robust, secure, and meets the needs of users.

Overall, the launch of the Lido V3 Whitepaper is an exciting development for the DeFi community. It represents a significant step forward in the evolution of staking protocols and has the potential to provide users with more flexible and customizable staking options. As the development of Lido V3 continues, it will be interesting to see how the community responds to the feedback request and how the final product shapes up.