Lido’s buybacks won’t fix the bigger problem

Lido has introduced a buyback plan of approximately $4 million annually, alongside a roadmap that aims to transition the protocol from exclusive staking to broader financial applications. Despite this, concerns over the viability of BTC treasury companies have surfaced, especially as Strategy trades below a market net asset value (mNAV) of 1 for the first time since early 2024. The overall market has been weak, particularly in Big Tech, while the Dow Jones has shown resilience. In crypto, indices experienced declines, with notable exceptions being Layer 2 solutions and Memecoins. Lido’s buyback strategy, which is contingent on high ETH prices and revenues, may not effectively support token pricing during market downturns. Furthermore, Lido's Q3 performance was unprofitable, questioning the real impact of the buyback in the current financial state of its DAO. In the broader crypto context, investors appear wary of relying solely on existing strategies for BTC exposure, as many see treasury companies as inefficient proxies. Overall, while Lido is evolving, the present buyback plan raises doubts about its urgency and effectiveness in addressing existing challenges.

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