The DeFi staking protool, Lido, has announced that it will wind down its Solana operations due to low revenue generation and unsustainable financing support for its operations.
Lido has taken action following community votes favoring the sunsetting of the Solana in a DAO proposal that was introduced on September 4. Over 92% of voters chose Sunset SOL staking, while only 7.2% wished to continue it with additional funding from the Lido DAO.
Lido’s P2P team sought funding of 1.5 million DAI for 12 months of Solana staking operations, which was rejected by the DAO, and eventually it had to shut down.
The community proposal stated that Lido on Solana, the P2P team, invested approximately $700k, which has generated a revenue of only $220k, resulting in a loss of $484k.
Solana staking was enabled by Lido in September 2021. After two years, it will be discontinued on October 16, and no new staking will be accepted onward. stSOL holders will continue to receive staking rewards until the completion of SOL staking.
Lido will begin off-boarding Solana nodes on November 17 while planning to wind down all node operations until February 4, 2024. If any staking still remains after February 4 next year, it will only be unstaked using CLI, according to the official announcement.
“Whilst this decision was difficult in the face of numerous strong relationships across the Solana ecosystem, it was deemed a necessity for the continued success of the broader Lido protocol ecosystem,” Lido said in a blogpost.