I’ve been thinking a lot about Lido Finance recently and what its success—or failure—means for Ethereum. Did you know they just turned a profit for the first time in four years? $5 million in net income, thanks to Ethereum’s price jumping 67% a few months ago. It’s clear they’re making big moves, like focusing solely on Ethereum and even letting more people run node operations.

But here’s what’s been on my mind: What happens if Lido Finance goes bankrupt? I mean, they dominate Ethereum’s liquid staking market. If something went wrong, would stETH lose its peg? Would DeFi protocols that rely on stETH, like Aave or MakerDAO, face massive liquidations?

And what about Ethereum itself? With Lido controlling so much staked ETH, could bankruptcy lead to validator disruptions or even threaten Ethereum’s decentralization? It’s a scary thought.

I don’t think Ethereum would collapse entirely, but the ripple effects could be huge. Competitors like Rocket Pool might pick up the slack, but would they be ready for such a shift?

I made a video diving deeper into this topic. If you’re curious about the future of Ethereum and liquid staking, I recommend checking it out. Let me know what you think—could Ethereum survive a Lido collapse?

https://youtube.com/shorts/KT5Y5MJ85AM?si=IArELsUXdN-PE8U-