Liquid Staking Protocol Lido Allocates $6M to Ethereum Development

Lido has committed two million of its LDO tokens to the Protocol Guild transfer, which is positioned as a new funding mechanism for public initiatives for the development of Ethereum.

The Lido Finance Governance Forum held a vote in support of the Ethereum protocol participants through the Protocol Guild worth about $6 million.

The Protocol Guild is considered a new approach to the concept of financing public goods, which supports development activities, especially in the sector of second-level solutions (Layer 2). It is a funding tool designed to provide autonomous mechanisms to recruit, retain, and reward members of the Ethereum core protocol.

Most of the current public benefit funding protocols in the Ethereum ecosystem are based on grants (such as Gitcoin grants) and retroactive funding programs (such as Optimism retroactive public benefit funding).

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The Protocol Guild criticizes current approaches, arguing that they have significant limitations that hinder their usefulness. One of these disadvantages is that they are not forward-looking, especially in the case of retroactive funding. Another complaint is that they do not provide value to individual contributors because their design prioritizes the development of project teams.

The Protocol Guild says it is proposing a public goods funding mechanism that will be more sustainable to support the Ethereum protocol. Part of this sustainability will include creating financial incentives to improve the core Ethereum codebase, as well as supporting not just teams but individuals as well.

Lido will allocate two million of its LDO tokens to this initiative. At the current LDO price, the grant is almost $6 million.