DeFi protocol Lido Finance announced in a statement that it will now also serve layer 2 solutions. The protocol will make the transition to solutions like Arbitrum and Optimism in the first place. A wrapped version of stETH will also be created.
Lido Finance Will Also Serve Tier 2 Solutions
Lido Finance’s stETH is also coming to tier 2. Making the announcement on the subject on its official blog, Lido Finance announced the new step with the following words: “Ethereum is scaling and Lido is doing the same. We are pleased to announce our expansion plans for Lido’s L2, starting with the expansion of stETH in the growing L2 DeFi ecosystem.”
This step means staking with lower fees for Ethereum stakers. They will also have access to a new suite of DeFi applications to increase their returns.
As we said at the beginning, wstETH is also included in the game with the new step. Lido announced that they have integrated Aztec and zkSync for wstETH. It was also stated that the integration was done through Argent.
Layer 2 protocols run a separate blockchain on the mainnet. Thus, a secondary framework is created in which transactions can be carried out. After the transactions are processed, the data is sent back to layer 1 where it is stored in the blockchain ledger. Thus, layer 2s help reduce network congestion on the mainnet.
We can list some of the most known Ethereum layer 2 solutions as follows; Polygon, Optimism, Arbitrum, and Loopring.
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