A new governance proposal from the Lido DAO community is attracting significant attention in the crypto market as Ethereum's largest liquidation Staking protocol considers using approximately $20 million in funds to buy back LDO Governance Token . This move comes as LDO price hovers near its all-time low, creating a new narrative about how DAOs use funds to stabilize tokenomics and bolster market confidence.
The proposal, put forward by the Lido Ecosystem Operations team, seeks authorization for the Lido Growth Committee to spend up to 10,000 stETH from the Treasury to accumulate LDO. With ETH prices around $2,000, the transaction would amount to approximately $20 million. This is XEM a "one-time" action, separate from the automated buyback plan NEST that was introduced at the end of 2025.
According to the proposal, the current LDO/ ETH ratio is around 0.00016 — approximately 70% lower than it was two years ago. The Token hit a historical Dip of around $0.27 on March 7th and is currently trading around $0.31, bringing its market Capital down to nearly $260 million. If the entire plan is implemented, the purchase volume could absorb approximately 65 million LDO, equivalent to nearly 8% of the circulating supply. The DAO argues that the current valuation reflects a significant mismatch between the Token price and the protocol's underlying fundamentals, rather than simply typical market fluctuations.
Notably, this proposal is designed for faster and larger-scale deployment than the NEST program. The NEST plan is only expected to activate when ETH surpasses $3,000 and Lido's annual revenue exceeds $40 million, while also capping the budget at $10 million per year. Meanwhile, the one-time buyback proposal allows the DAO to act immediately while the market is still low, with a scale double the annual NEST limit.
Financial data shows Lido's 2025 revenue reached $40.5 million, a 23% decrease from the previous year. However, the DAO emphasized that the decline in LDO price was much more significant than the decline in protocol performance. Net rewards decreased by approximately 20%, while the LDO/ ETH ratio dropped by as much as 50%. Simultaneously, operating costs decreased by 13%, and the revenue-efficient ratio increased from 5% to 6.11%, indicating continued improvement in operational performance.
LDO 's on-chain liquidation is currently quite thin, with a depth of only about $90,000 within a ±2% range. Therefore, the purchase plan will be Chia into batches of 1,000 stETH, deployed through DeFi platforms such as Uniswap, CoW Swap, and CEX exchanges including Binance and OKX, and may also coordinate with market maker partners to mitigate slippage.
