What Is Lido Staked Ether (stETH)? Stake and Earn ETH Rewards

Lido Staked Ether (stETH) is a liquid staking derivative that allows Ethereum (ETH) holders to earn staking rewards without locking up their assets or losing liquidity. Developed by Lido, a leading decentralized finance (DeFi) protocol, stETH enables users to participate in Ethereum 2.0 staking while maintaining the flexibility to use their staked assets across various DeFi platforms.​

How Does stETH Work?

When you stake ETH through Lido, you receive stETH tokens in return. These tokens represent your staked ETH and accrue staking rewards over time. The process involves depositing ETH into Lido's smart contracts, which then stake the ETH in Ethereum 2.0's Beacon Chain. 

The rewards earned from staking are automatically reinvested, increasing your stETH balance.​

Key Features of stETH

Liquidity: Unlike traditional staking, stETH allows you to retain liquidity. You can trade, lend, or use your stETH in DeFi applications while still earning staking rewards.​

1:1 Peg to ETH: Each stETH token is pegged 1:1 to ETH, ensuring that its value reflects the price of ETH.​

Automatic Rewards: Staking rewards are automatically compounded into your stETH balance, enhancing your holdings over time.

Security: Lido employs a decentralized network of node operators to stake ETH, reducing the risk of slashing and enhancing security.​

Using stETH in DeFi

stETH can be utilized across various DeFi platforms, including:​

MakerDAO: Use stETH as collateral to mint DAI, MakerDAO's stablecoin.​

Curve Finance: Provide liquidity in stETH pools to earn trading fees and additional rewards.​

Aave and Compound: Lend stETH to earn interest or borrow against it.

These integrations allow you to maximize the utility of your staked assets while earning rewards.​

Also read How to Buy Lido Staked ETH (STETH)

How to Stake ETH with Lido

To stake ETH with Lido, follow these steps:

1. Visit Lido's Staking Page: Go to stake.lido.fi

2. Connect Your Wallet: Use a compatible wallet like MetaMask, Ledger, or WalletConnect.​

3. Deposit ETH: Choose the amount of ETH you wish to stake.​

4. Receive stETH: After staking, you'll receive stETH tokens in your wallet.​

5. Monitor Rewards: Track your staking rewards and stETH balance through Lido's dashboard.​

stETH Price and Market Data

As of April 19, 2025, the price of stETH is approximately $1,598.31 USD, with a circulating supply of 9.31 million tokens and a market capitalization of around $14.8 billion. The token is actively traded on various platforms, including Coinbase, Kraken, and Uniswap.​

Also read Lido Staked ETH Price

Advantages of Using stETH

No Minimum Deposit: Stake any amount of ETH without the need to meet the 32 ETH minimum required for solo staking.​CoinMarketCap

Flexible Access: Use your stETH in DeFi applications while still earning staking rewards.​

Decentralized Governance: Participate in Lido's decentralized autonomous organization (DAO) to influence protocol decisions.​

Risks to Consider

Smart Contract Risk: As with any DeFi protocol, there's a risk of bugs or vulnerabilities in the smart contracts.​

Market Risk: The value of stETH is subject to market fluctuations and may not always trade at a 1:1 ratio with ETH.​

Withdrawal Delays: While stETH provides liquidity, converting it back to ETH may involve delays due to Ethereum 2.0's withdrawal queue.​

Also read Should You Stake Your Ethereum? Passive Profit Strategies with Ethereum

Conclusion

Lido Staked Ether (stETH) offers a flexible and efficient way to earn staking rewards on Ethereum without sacrificing liquidity. By integrating stETH into various DeFi platforms, users can maximize the utility of their staked assets while participating in Ethereum's transition to a proof-of-stake consensus mechanism.

FAQ

1. What is Lido Staked Ether (stETH)?

Lido Staked Ether (stETH) is a tokenized version of Ethereum (ETH) that represents staked ETH on the Lido platform. It allows users to stake ETH and earn rewards without locking up their assets or losing liquidity.

2. How does stETH work?

When you stake ETH through Lido, you receive stETH tokens in return. These tokens are pegged 1:1 to the value of ETH and accumulate staking rewards over time. You can use stETH across DeFi platforms while still earning rewards.

3. What are the benefits of using stETH?

stETH provides liquidity by allowing users to participate in Ethereum staking without locking their assets. You can use stETH in DeFi applications like lending, borrowing, and liquidity pools, all while earning staking rewards.

4. Where can I buy or trade stETH?

stETH can be traded on major decentralized and centralized exchanges such as Uniswap, Coinbase, and Kraken. The price of stETH typically mirrors the value of ETH, with slight variations depending on the market.