Lido’s decentralized autonomous organization is weighing a one-off $20 million buyback of its governance token, LDO, to address a pronounced price dislocation relative to Ether, the DAO said in a proposal submitted Friday. The plan would swap up to 10,000 Lido Staked Ether (stETH) from the treasury for LDO, arguing the token is materially undervalued.
The proposal characterizes the current gap between LDO’s market price and protocol fundamentals as historically large and atypical. LDO’s market price has collapsed roughly 96% from its August 2021 peak and is trading at about $0.30, leaving a market capitalization near $255 million. The DAO noted LDO’s price-to-ETH ratio sits around 0.00016, roughly 63% below its two‑year median.
Lido proposes executing the purchase in up to ten smaller batches of 1,000 stETH to limit market impact. Each batch would require tokenholder approval before execution and be carried out using limit orders or a dollar-cost averaging approach to avoid driving extreme volatility. Results from each tranche would be reported before proceeding to the next, and tokenholders could halt the program at any point.
The buyback effort follows prior community discussion of automated buyback mechanisms that have not been implemented. Lido remains the leading liquid staking provider on Ethereum, controlling roughly 23.2% of staked ETH, a market share that has previously drawn centralization concerns.
Lido’s finances have softened alongside the wider market. The protocol’s revenue fell about 23% to $40.5 million in 2025, with staking fee revenue down to $37.4 million. Despite that decline, the DAO argues fundamentals remain resilient: staking rewards slipped by roughly 20% amid the market contraction, operational costs improved by about 13% year-over-year, and Lido’s take rate—the share of staking rewards it retains—rose from around 5% to over 6.1%, boosting fee capture.
Proponents say the buyback would help correct a valuation gap not reflected by protocol performance, while critics may view treasury-driven purchases as risky or as addressing market sentiment rather than structural issues. The proposal’s staged approval process gives tokenholders multiple opportunities to weigh the tradeoff between using protocol assets to support token price and preserving treasury reserves.