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Ethereum staking provider Lido to add NFTs into unstaking process

Ethereum staking provider Lido to add NFTs into unstaking process

Users who want to withdraw staked ether will get a token that can be traded but can’t be used to buy anything else.

At its Node Operator Community Call #5, Lido, which is the largest decentralized finance (DeFi) system by total value locked, announced plans to launch a non-fungible token (NFT) to show how much ether a user wants to withdraw (ETH).

When the next big update to the Ethereum blockchain, Shanghai, which designers also call Shapella, is put into place next month, these withdrawals will be possible.

Ways to withdraw ETH from Lido

Mariya Muzyko, a product manager at Lido, said on Tuesday afternoon’s call that there will be two ways to withdraw ETH from Lido. Customers can unstake their stETH and get ETH at a 1:1 ratio. These steps are asking for and getting. When a user asks for a withdrawal, Lido sends them an NFT that serves as legal proof of the request. The user can then use the NFT to claim their ETH payouts. When the user redeems their ETH and gets it back, the NFT is burned.

What is stETH?

Lido was the first to give ETH holders who wanted to stake their tokens access to liquidity. They did this by creating a new token called stETH. This token, which can be used on many DeFi platforms, shows the total value of the user’s initial investment plus any interest that has been earned. Adding an NFT to the process of requesting a withdrawal is also a first of its kind.

Users will be able to send each withdrawal-request NFT to a different address. This new address will then be able to claim the ether prizes that go with it. Lido said that if a user sells their NFT on a secondary market, Lido will not take a royalty out of the sale.

The community call said that withdrawals will take between one and five days to process, depending on how much stETH is being withdrawn and how many withdrawals are being made.

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About MahKa

MahKa loves exploring the decentralized world. She writes about NFTs, the metaverse, Web3 and similar topics.

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