Lido’s Ecosystem Operations team has proposed a considerable buyback of its governance token, LDO, utilising up to 10,000 stETH from the Decentralised Autonomous Organisation (DAO) treasury, aiming to purchase approximately 65 million LDO tokens—about 8% of the circulating supply. This strategic move is in response to LDO’s recent market performance, having traded at around $0.27 on March 27, 2026, closely approaching its all-time low of $0.2714 observed on March 8. Over the past two years, LDO has underperformed against Ethereum (ETH) by nearly 70%.
The buyback initiative, which requires a vote from the DAO, is framed as an exceptional measure rather than a standard treasury operation. The rationale behind this intervention is that LDO’s current market price has diverged significantly from the protocol’s fundamental value, more so than at any point in history.
The LDO buyback will be executed in increments of 1,000 stETH across various platforms, including CoW Swap, Uniswap, Binance, and OKX, ensuring that the transactions are managed by Lido’s Growth Committee alongside affiliated market-making partners. The funds for this operation will derive solely from stETH already held in the treasury, with no new tokens being issued.
### Decline in Revenue
Despite being the largest liquid staking protocol on Ethereum and maintaining approximately 23% of all staked ETH, Lido’s market share has decreased from over 28% in 2024, primarily due to increasing competition from exchanges, custody services, and innovative restaking solutions.
Financially, Lido faced notable declines in performance last year, with revenue plummeting by 23% to US$40.5 million (AU$59 million) in 2025, down from US$52.4 million (AU$76 million) in 2024. Staking fee revenues dipped to US$37.4 million (AU$54 million), while total gross staking rewards fell by 18% to US$846.7 million (AU$1.23 billion).
Notably, the proposed treasury action is distinct from Lido’s NEST buyback initiative, which remains inactive due to unmet market and revenue conditions. A date for voting on this new proposal has yet to be established.
### LDO Approaches All-Time Low
The backdrop for this buyback comes against a long-term decline in LDO’s value relative to Ethereum. On March 27, the token was valued at about US$0.27 (AU$0.39), slightly above its all-time low set earlier in March. Lido’s governance discussions reveal that LDO is currently trading at a staggering 70% discount compared to the ETH-denominated levels observed over the preceding two years.
This downward pressure has been exacerbated by substantial sell-offs from major holders, particularly those possessing between 10 million and 1 billion LDO, who sold around 80 million tokens between October 2025 and early 2026. As a result, LDO’s market capitalisation has dwindled to approximately US$260 million (AU$377 million).
### Conclusion
In summary, Lido faces various structural challenges amidst a declining market for its governance token, prompting a significant intervention strategy to stabilise LDO’s price. As it navigates these obstacles, the upcoming proposal vote will be pivotal in determining the future trajectory of both Lido and its governance token.
