The Lido DAO is considering a major $20 million buyback of its governance token, LDO, in an effort to correct what it describes as a “historic price dislocation.” Despite strong protocol fundamentals, the token has fallen sharply—down nearly 96% from its all-time high—raising concerns among stakeholders.
Currently, LDO is trading around $0.30, a steep decline from its peak of $7.30 in August 2021. With a market cap of roughly $255 million, the token ranks outside the top 100 cryptocurrencies. This drop comes even as Lido continues to dominate the liquid staking space on Ethereum, holding a 23.2% share of all staked Ether.
Why Lido DAO Wants a Token Buyback
According to the proposal, the DAO plans to swap up to 10,000 stETH (Lido Staked Ether), valued at approximately $20 million, from its treasury to buy back LDO tokens. The organization believes the current price undervalues the protocol’s real performance and position in the market.
Lido DAO argues that LDO’s price relative to ETH has dropped to 0.00016, which is about 63% below its two-year median. This gap, it says, is not justified by any major decline in the protocol’s fundamentals.
While revenue declined by 23% to $40.5 million in 2025 due to lower staking fees, the DAO highlighted several positives:
- Rewards only dropped 20%, aligning with broader market trends
- Operational costs improved by 13% year-over-year
- The protocol’s take rate increased from 5% to over 6.1%
These metrics suggest that Lido remains fundamentally strong despite market pressures.
How the Buyback Plan Will Work
The proposed buyback won’t happen all at once. Instead, Lido DAO plans to execute it in smaller batches of 1,000 stETH at a time. Each batch will require approval from tokenholders, ensuring community oversight throughout the process.
To minimize market disruption, the DAO intends to use strategies like:
- Limit orders
- Dollar-cost averaging (DCA)
Additionally, results from each phase will be reported before moving forward, allowing flexibility to pause or adjust the plan if needed.
This isn’t the first time a buyback has been suggested. A previous proposal in November recommended an automated mechanism, but it has yet to be implemented.
