Lido DAO has announced the implementation of a new governance model that grants ETH stakers veto power over proposals. This move aims to enhance trust and security within the protocol.
Lido DAO's New Governance Model
Lido DAO has approved a dual governance mechanism, allowing ETH stakers to veto proposals. This change aims to reduce governance risks and better address stakeholder interests. Lido researcher Hasu noted, 'Lido really reduces the risk that users have from any kind of governance attack and the trust that they need in the maintainer companies and the LDO holders.'
Impact on User Trust and Security
The new governance structure aims to increase user trust in the Lido protocol. The introduction of veto power allows stakers to block contentious proposals, thus promoting a more transparent governance process and protecting participant interests. This is expected to improve trust and security within the community.
Prospects for Institutional Investors
With the increase in staker powers over decisions, the current changes may attract institutional investors' attention. Previously, governance risk has been a significant barrier to large-scale staker participation. An improved governance structure could enhance stability in the staking market and thus attract more participants.
By introducing a new governance model, Lido DAO not only strengthens trust among users but also creates conditions for a safer and more transparent staking process. This could have a positive impact on the future of institutional investments in the Lido ecosystem.
