Key Takeaways
- A one-time $20 million repurchase program for LDO governance tokens has been introduced by Lido DAO, utilizing 10,000 stETH from protocol reserves.
- The LDO token currently trades at $0.30, representing a 95.9% decline from its August 2021 peak of $7.30.
- LDO’s value relative to ETH sits approximately 63% under its two-year average, marking what the DAO describes as an unprecedented valuation gap.
- Implementation would occur through incremental purchases of 1,000 stETH, with each phase subject to individual tokenholder authorization.
- Protocol revenues declined 23% to $40.5 million in 2025, yet Lido maintains dominance with 23.2% of Ethereum’s total staked assets.
The governance community behind Lido DAO has unveiled a strategic initiative to repurchase $20 million of its native LDO token. Submitted for consideration on Friday, the proposal is currently under tokenholder review.
$LDO may have 2 token buyback mechanisms!
One depends on @LidoFinance profits and activates when $ETH is above $3k (max $10m per year).
The second mechanism, a new proposal, is a “manual” LDO buyback with an allocation of 10k ETH = roughly $20m in ETH.
Lido, as a protocol with… https://t.co/gWebrjmznv
— Sholi – real human, not an AI slop bot! (@Sholi_software) March 27, 2026
The initiative seeks authorization to deploy 10,000 stETH from the protocol’s treasury — valued at approximately $20 million at current market prices — for acquiring LDO tokens through open market transactions.
According to the DAO, LDO is experiencing one of the most severe valuation discounts relative to Ethereum in its trading history. The current LDO/ETH price ratio of 0.00016 represents approximately 63% below the two-year median benchmark.
Data from CoinGecko shows LDO trading at $0.30 currently, marking a 95.9% decrease from its historical peak of $7.30 achieved in August 2021.
With a market capitalization hovering around $255 million, the token ranks as the 141st largest cryptocurrency by total value.
“That dislocation is not justified by a proportional deterioration in protocol performance,” Lido DAO said in the proposal.
Buyback Execution Strategy
Rather than executing the entire buyback simultaneously, the DAO has outlined a phased approach. The repurchase program would proceed through incremental transactions of 1,000 stETH each, building toward the 10,000 stETH maximum.
Every individual phase requires standalone tokenholder approval before execution. To minimize market disruption, the DAO indicated it would employ limit order strategies or dollar-cost averaging techniques throughout the process.
Detailed reporting on each completed phase is mandatory before advancing to subsequent purchases.
The DAO had previously explored an automated repurchase framework in November 2024, though that proposal never reached implementation.
Revenue Challenges Despite Market Leadership
Lido’s financial performance in 2025 showed revenues of $40.5 million, reflecting a 23% year-over-year decrease. Staking fee income, which constitutes the primary revenue stream, contracted 23% to $37.4 million.
While recognizing the revenue reduction, the DAO highlighted positive operational metrics. Operating expenses improved 13% annually, and Lido’s protocol fee rate increased from 5% to 6.11% of total staking rewards.
Despite LDO’s price struggles, Lido maintains its commanding position in Ethereum’s liquid staking sector. Dune Analytics data confirms the protocol controls 23.2% of all Ether currently staked on the network.
This market concentration has previously attracted attention regarding potential centralization vulnerabilities within the Ethereum ecosystem.
The proposal advances to a formal tokenholder vote, where LDO holders will determine approval for the initial 1,000 stETH repurchase tranche.
