Ethereum’s [ETH] staking platform Lido Finance announced its support of Chainlink Price Feeds to expand stETH adoption across decentralized finance or DeFi protocols. For the uninitiated, stETH is a token that represents the staked ETH in Lido, combining the initial deposit value with rewards. Thus, the token enables users to earn DeFi yield rewards.
According to the blog, with the stETH/USD Price Feed launched on Ethereum mainnet, DeFi projects would be able to cite this oracle contract at any given time to get the latest price of stETH when executing on-chain functions. As a matter of fact, the stETH/USD Chainlink Price Feed is already being collectively used and sponsored by a decentralized community of users, which includes several DeFi projects like Aave, Compound, and Enzyme.
Lido Finance is a leading liquid staking protocol that allows users to stake Ethereum [ETH], Solana [SOL], and Terra [LUNA] and receive staked liquidity tokens in return at a 1-to-1 ratio. It is fully DAO-operated and currently supports staking for ETH, LUNA, and SOL.
Chainlink’s data reliabilty
As per the blog, the reason for the integration with Chainlink is to expand ‘the utility of stETH, as users can earn the normal staking rewards from Lido while also deploying stETH as collateral in DeFi’. Apart from that, It would also enable new DeFi protocols to add support for stETH and have immediate access to a secure and reliable oracle solution. Reading along the same lines, Lido added,
“We selected Chainlink as it’s the most time-tested decentralized oracle network in the industry, demonstrating verifiable reliability across multiple blockchains during the most extreme network congestion and market volatility. Not only do Chainlink Price Feeds supply real-time price data with wide market coverage, but it’s a blockchain agnostic oracle solution, which will be critical to aiding in our multi-chain expansion.”
The staking platform is further planning to expand support of Chainlink Price Feeds in the future for its multiple platform initiatives, such as decentralized price oracles for bLUNA, stSOL, and the assets of blockchains that Lido plans to onboard that includes Polkadot [DOT], Avalanche [AVAX], and Polygon [MATIC].