The price of Lido-staked ETH (stETH) has fallen significantly against Ethereum prices, losing its intended parity with the latter asset.
Lido-Staked ETH Loses Target Price
stETH is losing parity with ETH.
As of 21:00 UTC on June 10, the price of stETH on Curve was 0.9474 ETH. That price represents slippage of about 5% despite the fact that stETH is backed nearly 1:1 with ETH deposits.
This Curve pool is becoming heavily imbalanced as market participants continue to sell their stETH for ETH. The pool is now made up of approximately 80% stETH and 20% ETH, which is causing the Curve algorithm to adjust the price.
With more than $1.2 billion in liquidity, the Curve pool is the deepest in the market. Therefore, it has a major impact on the overall market price of stETH. Various other DeFi exchanges—including Uniswap and Curve Finance—plus a number of centralized exchanges also handle stETH but are unlikely to have as large an impact as Curve does.
Lido’s governance token, LDO, is...
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