Staked ETH ETFs and Lido's institutional push

Transcript

So when you have something like liquid staking and especially liquid staking that's enabled by a decentralized protocol, you're challenging a lot of these traditional preconceptions about how things are supposed to work. GM GM. Good morning and welcome to the Milk Road Show. The daily crypto show where my job is to say wow interesting [music] repeatedly while the real experts talk. I'm your host LGD set and today is Wednesday October 29th 2025. Today we're joined by the Lido team, Kian, the head of institutional relations, and Izzy, the chief of staking, and we're going to talk about their Van E ETF, why it matters for staking's future, and how close we are to having something like Ethereum as Ethereum staking becoming as easy as a savings account. We're going to look inside their biggest evolution

yet. Look at their V3 and how they're finding new ways uh for people to earn yield through DeFi with with Lido Earn. And of course, if we have time, you guys know my vibe, we'll have a little bit of chaos, maybe have make a couple predictions for ETH's future. Before we start, uh, Milk Road is actually hiring right now. We're looking for sharp, creative video editor, graphic designer to make our ideas look as good as they sound. Uh, so if you love turning podcasts into fun clips, making great thumbnails, taking a photo of me and using a bit of AI to spruce it up and make me look a little less strange, uh, this is your shot. So, please apply today. the description or the the application link is in the description, so check it out. And today's episode is brought to you by Gemini Credit Card.

Turn your everyday spending into Bitcoin. Stack SATs without even thinking about it and bridge power your business with instant stable coin payments. No friction, no banks, just global finance made simple and figure markets. Earn solid return on your cash because sitting idle isn't a strategy enough for me. Let's get Kian and Izzy out here. Gentlemen, listen. This is I feel like this is a bizarre time to talk when the government is shut down and you guys are in here trying to be like let's get these ETFs approved. Are you guys sweating right now or you're just as cool as a cucumber while uh while you're waiting for the government to open up? >> Yeah, it's a good question. I think look, we're excited. Um like anything worthwhile doing in life, nothing's ever easy and this is just kind of another I suppose speed bump we've kind of gone

through. Um, the exciting thing is for us is that like obviously the the shutdown actually happened just before the S1 got approved. So for it actually to be I suppose approved is sorry the wrong word for it actually to be filed and the review to hopefully happen in a couple of weeks will be really exciting. >> Is that what you expect? Do you think you think we'll be back on track this year? >> I think so. Quietly confident [clears throat] but you know I'm a glass half full type guy. >> [laughter] >> when this >> I'm quite confident. I guess doesn't mean like you're betting on prediction markets right now, can you?

>> Exactly. I'm hopeful. That's all I can say. >> Hopeful. That's good. Yeah. A good optimist like that. Can you guys explain to me um for people that don't know and especially me, I come from more like the you know the DJ side of things uh in in the institutional side of all this uh I know is is is in in good shape right now. But I want to understand from you guys is something like this like an ETF, how does that work? Why is that significant um for for for for the for I guess for Ethereum and for the industry? >> Sure. So I can try and take that like I think it's it's definitely significant because ultimately it brings DeFi institutional staking to a mass market.

So like if you think of what ETFs are today, it's effectively a wrapper where institutions are comfortable using as a gateway. And the big issue with kind of staking ETFs today is that they tend to have a small allocation being staked. So if you think of native staking today, one of the big issues is the entry queue. So you're waiting 20 25 days just to start earning rewards. But the broader issue for a lot of these ETFs is the unstake or the withdrawal queue taking around 45 days. So these ETFs typically have to deal with redemptions in around a T plus2 basis and that's why they tend to have a large proportion of the product unstaked. So for example in Europe like staking in European products

has been around for quite a while but they tend to only have to they tend to only have a 50% staking rate. What Lido is able to unlock with liquid staking is a 100% stake product. And this is obviously really attractive from two points. First, the issuers's perspective, they can have a better product. And secondly, from a an investor's perspective, they're able to get the full staking yield. So, they're getting better returns. And I think that's what we're really excited about. We're able to bring a better product to the market that institutions actually want to buy.

So is that so so in for something like this this would be an ETF for specifically staked ETH whereas the other ETFs are not right >> they would be natively staked products we're launching a Lido staked ETH or STE product >> right okay so that so so how is that different for some how does how does that diff why would somebody buy that over the normal like a regular Ethereum ETF >> so like A regular Ethereum staked ETF, like I said, is only 50% staked, which means you're only getting, let's say, for example, 1.5% of the staking rewards. What we're able to offer with a liquid stake product is that you get the full 3%. So, it's a 100% stake product

versus a 50% stake product. >> And this is great from an issuers perspective because it's like generating higher returns. >> Got it. Okay. So, then the the So, then Okay. So, you're literally you would get double the returns, double the yield basically on that. So that's advantageous. Okay. So I mean why would anybody So why would anybody buy the other ETFs instead of the staked one? >> Well, look, that's why Izzy and I are here is trying to kind of educate the world like to let people know liquid staking is here [laughter] [gasps] >> and and and Van is that is that a um do they just launch ETFs like you guys partner with them to launch the ETF? How does that work?

>> Yes. So we would work in quite close collaboration with FAX. So we would have went through a huge amount of kind of due diligence educating them on what liquid staking is getting them comfortable with the concept of like using Lido core. So obviously liquid staking is quite different to native staking especially with Lido a big proponent of what Lido does is driving decentralization and Izzy can probably speak better to this but the idea that we have over 800 different node operators within Lido is like a tremendous selling point for what we do like diversity is critical. I think there's been a couple examples of that over the past kind of two quarters where diversity is super important. So again, a lot of what we've done with fak van is just getting them comfortable with what

lido is as a dowo, what ste is liquid staking as a whole. And they ultimately saw the benefits of a 100% stake product and lido and ste enabling that. >> Ken, how far has has uh have staked products have to come in this environment or liquid staking? I feel like that's something that, you know, I feel like it's taken regulars so long to even just wrap their heads around crypto and accept it and now you're clearly advancing them so much with liquid staking, but that must be that must be a hard pill for them to swallow.

>> Um, I I wouldn't say it's a hard pill for them to swallow. I would just say it takes time. Like I've always kind of broken it down as levels. Like level one is native staking, level two is liquid staking, and then level three could be considered restaking. So just getting them comfortable with like native staking, getting them to dip their toe in the water, that's terrific. Then when you start getting a little bit more advanced, that's when you can see the real benefits of liquid staking. So again, with Lido, being able to stake your ETH and earn instant rewards, there's tremendous value in that. Or at the other side of that, if you want to start unstaking, the ability to swap ste into stables, that's a selling point that again serious institutional investors will understand. Um regulators on the other hand they obviously have to

be educated and have to be quite riskadverse in what they do but ultimately like Lido adds a tremendous amount of value and it just takes time for everyone to get there and understand at the same level. >> Yeah. And maybe to add to this I think we we kind of see this in terms of like how the regulatory developments also take place like the order and um I I I guess like the relative complexity of each of the different developments. So, we saw the SEC provide um like a statement on general staking activities, I guess you could say, like earlier on in the year that covered custodial staking and native staking or solo staking. So, like the kind of staking that you can do from home or if you're you're basically using a custodian to do it on your behalf. Uh but they they

basically made like a very explicit note that said this statement doesn't cover potential liquid staking activities or more complicated activities like restaking. Um so more recently uh I think like approximately a month and a half ago uh we saw that they released this this statement on certain uh liquid staking activities. So like Keen said it's really a lot about education. Uh it's about having conversations to a allow people to wrap their heads around how does something that doesn't work at the base layer. You know like native staking works but happens on the application layer but still enables activities that happen on on the base layer work. How does something that is decentralized work? Um how do you reason about things like Dows? uh organizations that essentially only exist uh in cyerspace and and on blockchains uh but

still somehow manage to complete and execute these administerial services of taking capital that is allocated by users um and dispersing it in a way uh that is like non-custodial is is secure and secured by by code by smart contracts. >> What's the biggest push back on all that though? I mean you guys paint such a pretty picture but I mean when you're talking to I mean Venick or any other you know any other institutions or the regulators like what what do they just is there anything that they immediately say be like hold on what about this so I think it's not necessarily push back well in some it might be but I I I think the first part is like level of complexity and the second part is novelty so a lot of the ways that these uh like large institutional players

reason about things is basically based on precedence so They have established processes for how they think about things. They have established regulatory guidance for what it means to work with like a counterparty. Expectations from uh both a technical and an operational and a legal perspective like you have like an actual legal counterparty that you're working against. And due to the advent of blockchains and how things can happen in a decentralized manner, a lot of these things are or can be done differently. Um, so when you have something like liquid staking and especially liquid staking that's enabled by a decentralized protocol, you're challenging a lot of these traditional preconceptions about how things are supposed to work. Um, and so at that point, what you have to do is you have to like educate uh the counterparty about how you can do these things and

why does a distributed and decentralized protocol work just as well or even better than having like a single counterparty um that you can hold accountable? How do you balance the trade-off of things like smart contract risk against like counterparty credit risk and financial risk and and things like that? >> Did you know you can earn Bitcoin without ever buying it? That's where the Gemini credit card comes in. Here's [music] how it works. Earn up to 4% back in Bitcoin on gas, transit, and ride share. 3% on dining, 2% on groceries, and 1% on everything else. Use it just like any other credit card, and you're building a crypto portfolio at the same time. The best part, the Gemini credit card has no annual fee and works anywhere [music] Mastercard is accepted.

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>> Yeah, that makes sense. Is this is this something you guys view, and again, this is maybe I'm super green to like uh any kind, you know, more of the cryptoetf side, but is this something you guys see as more of an institutional product or as a retail product? like who do you who do you when you guys are creating the marketing for this or the documentation who do who do you actually want to attract? I mean Kian you're on the institutional side so I know obviously you're here for that reason but um you know I think for a lot of a lot of our audience listen there's you know we don't not everybody here is institutional right so they're going to be curious if this is something that when it goes live if they if it's for them if they should be looking at it.

>> Yeah. So from like an American ETF perspective with an I think it's definitely going to be a good combination of both. So from an institutional perspective, I think there's good opportunities for the DACO or the digital asset treasury companies to buy the ETF. And then from the retail perspective, same thing. So being able to go on their trading app and just having direct access to 100% stake product is really attractive. Like a lot of feedback we've gotten from people who may not be as crypto native as us, like they don't want to go through the process of setting up a wallet or like learning like the different types of risk when it comes to staking. like an ETF is a perfect kind of gateway for them to get exposure to crypto in a way that they probably have experience with already through their brokerages.

>> Where do you think we are in like the crypto adoption curve, especially from like this this level of institutional product, right? Cuz obviously the awareness I'm sure everybody knows about crypto at this point, but is this is this something you guys see as being like is this going to be part of people's savings account? like are they are do you obviously you want that but how realistic is that over the next 10 years? Yeah, I can give my two cents on this, Izzy, but um I think for me, like you only have to look what's happening in the market right now with Black Rockck Fidelity. Like my view has always been the same. Like these guys are serious players and they don't place spam bets. And for me, we're only kind of starting to ramp up right now. And I think the next big wave of success for

Ethereum is going to be institutional adoption. And yeah, the race has only just started from my perspective. Does it make you nervous when you see people like Tom Lee buying 5% of the supply or does that make you bullish? >> No, I I concur with with like Keen here. So I I think we're like at the beginning of institutional adoption and then what happens after like mass institutional adoption is that you have like the real mass uh retail adoption. I don't think uh I get nervous when when Tom Lee buys like 5% of of outstanding ether. Market forces have like a way of of balancing these things out. uh and at the end of the day um it matters a lot not only you know like what percentage of of of ETH uh like Bit Miner might have but also how they utilize it. Um and I think what

we're seeing seeing with a lot of uh at least the intents that we've seen so far from what institutions have signaled is that they're going to move into doing things in DeFi or where DeFi is the underlying layer pretty quickly. Um and I think there's a reason for that. One is that there's not a lot of different ways for these vehicles to differentiate themselves. So, first you can just hold the ETH, then you can stake that ETH, and then you can figure out how to deploy that ETH in a DeFi. Um, and that's really where the comparative advantage will be. So, you're going to have a lot of cases where there's going to be some people that are a little bit reluctant and then one player will will make a move and everybody else will kind of have to match them pretty quickly afterwards.

So wait, so wait in that are you are you the player making the move with the ETF? Like is that what you >> No, no, I would say that the DATs are specifically the players making the moves. We are essentially helping them helping give them moves to make. >> Um so a natively staked uh like product is basically like >> something just like one tick up from holding ETH. Uh a liquid stake product is essentially like the plus+ or like the evolution of that. And then I think the next thing after that is deploying your ETH in DeFi and potentially deploying your staked ETH in DeFi. And you cannot deploy natively staked uh ETH in DeFi. The only thing that you can do if you're like a DAT is collateralize the position against uh like another traditional credit institution. But

something like STD allows you to do that like natively uh on the blockchain. Uh and I think that's where the real kind of um comparative advantage of products like LIGO and and other kind of LSTs and potentially eventually restaking protocols comes in is that these building blocks are actually also the building blocks of DeFi, which is the next destination for a lot of these institutional vehicles. They're going to love it once they get in the weeds though. I once once once you guys keep doing your job so well and uh keep at it and explain all this stuff to them, I feel like they'll they'll really enjoy it. New financial vehicles.

One last question about the ETF. And again, this is a super green question, but how does how much ETH do you need for that? Is that is that how that works? Like you need a big bucket of ETH to to launch it or maybe that's that question didn't make any sense. >> Uh no, so it sounds like you're asking about like seed product. >> Yeah. Well Well, is it is it Yeah, I guess so. Like how much? Yeah. Go ahead. >> Yeah. So like what tends to happen is like we will go and we'll speak to a panel of different ETF issuers and we'll educate them and we'll kind of convince them that look this is the right product and you should launch this but ultimately it kind of comes down to two things from their perspective like is there a client demand and two how much

of a seed will you have to launch the product because ultimately these guys are commercial they have to cover costs and these ETFs and ETPs come at a cost to launch typically legal cost custody fees index providers and just general admin associated with managing the product. So I wouldn't say there's a minimum per se. What you want to do is you want to have as much of a seed as possible because it becomes quite attractive and it tends to get more media attention on top of [snorts] that. >> Right. Right. And is that would that is that number revealed when the ETF launches or at the filing?

>> Yes. So when the product launches um like for example in Europe it could be a case of you would seed the product in advance. So when it launches on day one there's a nice big seed. Other times it could be a case the product launches with no seed and then you would um invest on day one. So there's there's options on what you can do. >> Okay. Okay. Okay. Thanks for explaining that. This is good. This is like just good do personal education for me. I hope it helps people who are listening too because uh this is this is stuff that I've always I've always been curious about. Um I do want to give some time because you guys have a lot of great new stuff launching. So um tell me about tell me about Lido V3. What's coming with that?

>> Sure. So um if I were to describe how like Lido and SD works so far, I would say it's one size fits most. Um, I think you could even argue that in the beginning of of DeFi, it was like one sizefits-all, but users are kind of looking for something differentiated now and a lot of institutions or large asset allocators want to make more tailored decisions about, for example, how their ETH is staked. So, the way that it works right now is that essentially you allocate ETH to the lighter protocol and the protocol algorithm algorithmically, sorry, decides which node operators it's it's kind of sent to. And there are kind of protocol rules that all of these different operators have to follow with regards to how that stake is run. Uh but a institution might for example want to pick their node operator or they might

have an in-house node operator but still want to get access to SD. So SD vaults allow them to finally uh be able to stake in such a way where they tailor make the the validation setup but then still have the ability to get um exposure to SD at the end of the day. And the way that they do this is by essentially creating like a vault that is natively staked if you will but then lap wrapped by the lido protocol and then this wrapped vault can be used as a collateral position against which um some ST is made available and then the institution or its users can use this SD however they want to. They can deploy it in DeFi or they can loop it. So you could take the ST go to a lending market on chain borrow ETH against it and then stake again which allows you to

essentially lever up your position. Um, or of course you can you can just hold it like it would normally hold. Mr. Steve, >> Izzy, I'm going to need a good like tutorial video for all that, man. I'm going to need it. Absolutely. I'm I'm a visual learner. [laughter] >> We're we're actually I don't know if you were joining Dev Connect in in uh Buenocidas uh in the middle of November, but we're going to do like workshops uh around this because the launch of V3 will be at the end of November, beginning of December. Uh so we will have like a really big workshop around like how this kind of stuff works. So, if you're around, uh, ping me and we'd be happy to invite you.

>> Is anybody else doing that? Like the kind of what you're describing. Are there any other D5 products doing that or is this a new a new kind of idea? >> From a staking perspective, I wouldn't say that it's uh like a new idea. So, um, on the Ethereum side, uh, like the idea of using staking as vaults is something that that has been done before and basically like allowing node operators to customize their vault and and making them the BD arm. uh I guess if you want to think about it that way of the staking protocol. I think what hasn't been done before is um essentially creating a product that allows you to integrate the staking position together with a DeFi position.

Uh and it's not necessarily that like it wasn't thought of technically, but at the end of the day, what matters the most if you want to be able to like deploy your capital in the DeFi is that you want utility for the token. So you want a lot of different integrations and you need liquidity. Um, and so the the real success story, I guess if you want to think about it this way, of Lido has been not only the way that it has created such a decentralized and robust staking layer that sits at top Ethereum, but powers Ethereum, but also the degree to which um, ST can be used uh, almost as an alternative to ETH in in DeFi. So you can do almost all of the different things that you can do with ETH with STE and to a very large uh extent like with

really huge amounts of scale and I don't think there's like many other tokens that that can do that in existence regardless of the network. And so when you put those two things together and then you also allow for this customization of the validator stack you create an optionality that other protocols haven't be been able to do um in the past. >> Got it. Okay. And is this is this live yet? Is V3 out? >> It's not it's not out yet. It's like in the final stages of test net right now. And actually we just had um >> the the hoodie test net had the Fusaka hard fork which is going to happen like in early December for Ethereum mainet and everything is is looking great and so we are um gearing up for V3 being deployed on Ethereum mainet in the first

week of December. >> Got it. Okay. Well, maybe you'll have an ETF by then. Hopefully that'll be a perfect perfect alignment of of excitement. And tell me guys about uh Lido earn. And I know that's another thing you guys are rolling out. >> Absolutely. Um, so learn is essentially a gateway for people that have ETH or STE to be able to do more with their SD in a way that is curated by the same contributors that are helping make um like the Lido protocol what it is right now. Uh it doesn't actually tie into uh like the Lido staking layer itself. It's built on top of SD. So the risks for example that you might have if you're deploying your assets into light to earn because there it's underlied by DeFi strategies don't uh affect the

underlying staking protocol at all. So the two things are are quite well separated from uh a risk perspective but essentially what it does is all right now you have ST or maybe you have some ETH and ST and you want to deploy them in a way uh that complements each other. There's a lot of different blue chip DeFi out there. Uh whether it's, you know, using lending markets like a or Morpho, uh levering up your positions, borrowing against your positions or taking advantage of like arbitrage opportunities that exist. And lighter earn is essentially a curated gateway to surfacing a bunch of these different DeFi opportunities to users of ST and ETH right now and potentially other tokens in the future.

>> Right. So you're so people will be so on lido people will be able to use their SD to earn yield from these other from these other >> yeah you can earn additional yield essentially from from DeFi strategies that are operated by third parties so there's different vault infrastructure if you want to think about it this way like the people that actually create the smart contracts and then there's also vault curators and it's the people who are devising uh and deploying the funds across all of these different strategies in in DeFi and basically uh like lighter earn is a curated selection of of these different vaults.

So >> yeah. Yeah. So all of the different partners that are surfaced on Lido earn essentially go through the same security and due diligence process um that things go through when we develop them internally in Lido. Uh so what we're doing is essentially lending the lido distribution network the strength of the underlying assets and the expertise that we have from a security perspective from a smart contract perspective from a UI and UX perspective to to putting like all of these different opportunities through through a due diligence if you want to think about it that way.

>> What are the rewards look like for that? >> So the rewards are thankfully of course like always above staking APR. of staking APR for users [clears throat] is between like 2 and a half to 2.8% these days depending on execution layer rewards. I think when the vault first launched it had uh like >> a rewards rate like really high like above 10% maybe even around 15%. For a week or two it really depends on on like what's going on in the market uh especially lending market rates. So, how expensive is it to borrow ETH and lever up your position? But, uh, I think in the long term, um, we're aiming for something between like 5 to 8%. Why do people invest in real estate? Because it spits off cash flow. But, I'm not here

to manage rental properties. That's why I'm looking at Figure Markets. Their new democratized prime product backs your money with real cash flowing assets and returns up to 9% APY. It's the first real [music] world asset 40 lend pool built for everyone, not just institutions. Ready to lend like a bank and get more than the 5% A is offering you? Download the Figure Markets app today and get 9% on your idol funds. Go to milkroad.com/figurearkets. >> I mean, that's that's like you said, that's way better than actual just staking E. So, that's actually pretty sweet. [laughter] Who are the So, who are the Can you tell us who some of the curated who's on the curated list of protocols?

>> Yes. So currently there's two vaults in lighter earn. One is called GGV uh the golden goose vault. Actually if you like deposit ether's teeth it actually honks. It's a cool little Easter egg. Um it is run by VA both from a infrastructure and uh curation perspective. And the second vault is called DVD the distributed validator vault. Uh and it is run by Melo. Uh, and essentially that vault doesn't do a lot more than normal staking does, but what it does is it takes the ETH that you were to stake to Lido and stakes it in a specific part of LITO that is run using distributed validator technology. It's a big amount of words together, but it basically means like validators that are co-run by people. It's almost like if you had a multisig that was running a validator for you and there's two large DVT

infrastructure providers right now on Ethereum, SSV and Opel, and they essentially send incentives uh into this vault. And then those incentives are are pushed further to the users for essentially creating uh the capital that that seeds these DBT validators. >> How do you guys see LITO evolving beyond staking? I mean this these are fantastic products and somebody used you know somebody who used Lido a long time ago. It's great to see like new options like that. Um so congratulations on I mean I'm sure that's a lot of work to get those out. Um what's next? What is is LITO always going to be like a a staking protocol ETF or or is there is there more in the pipeline later on?

>> So if we like >> maybe you can't say maybe you can't say >> I [snorts] I I mean I can't say everything but I can say like my personal uh viewpoint on this. I think staking is is essentially like the base layer of Ethereum, right? But there is a certain level uh at which the things that you can do in staking become constrained. Like there's not much more that you can do. Um also because the base layer uh from a staking and consensus perspective isn't going to evolve a lot more. Um but what you can do is think about how staking enables DeFi and what other things in DeFi either adjacent or you know next to staking are things that users and the users of lighter would find useful and interesting. Um and I think essentially as we are talking about like what does

it mean for crypto to enter this new adoption phase. We want to think about like who are the new main users of crypto going to be and and what will they want to do. So you will have you will see like retail users of course using crypto. Maybe it's for saving, maybe it's for investment. But I think you will also see a lot of businesses like enterprises start using crypto. They might start replacing their banks. They might start uh like using crypto as a part of a way to manage their uh like their balance sheet. And I think um there's a lot of like fruitful land I guess if you want to think about it this way for Lido to be one of the leading players for uh businesses that that want to use DeFi and want to use it in a safe, robust, decentralized and very

accessible way. So you're thinking you're So So you're telling me that for Lido you guys would maybe have more of like a like le like like more of a business product on top of like the institutional product. Is that what you're saying? Like something that businesses can use like everyday businesses? >> I I I think that's where the next like large uh volume if you want to think about it this way of crypto adoption is going to be. So obviously you know like enabling retail consumers to get access to better yielding opportunities if you want to think about it like that is is kind of our bread and butter. But the the next real like setting aside the institutions which will hopefully you know enter the space in the next year year and a half. I think the next real uh next real advent of adoption is going

to be businesses. So people that were traditionally banked by like pretty crappy financial institutions are going to realize that there's a lot of really great ways not only to infranchise yourself from a business perspective in terms of like having more control over your assets, but also a lot more opportunities. So you will see businesses start to use DeFi for credit uh and for debt. And I think there's there's a lot of opportunities there. >> Keen, do you agree, man? Like tell me we haven't heard from you in a little bit. Is that is that is that the future for Lido and and for for crypto in general? >> Uh yeah. No, I 100% agree with Izzy.

Like for me, I just want to make staking as easy as possible for institutions and Lido has a terrific track record in doing that and they've obviously Lido's been around for quite a long time and it's battle tested. The next big thing for institutions is if lido can become a little bit more productized and I think like as Izzy has kind of beautifully articulated earn and the vaults around that are going to be very easy ways to do that. I think the earn concept and ST vaults is going to be terrific especially for the DATO as they try and compete with these ETFs once staking is enabled like I think that's going to be the big differentiator for these DAC codes like Shark Link for example that if they're just offering their clients a

staking yield of 3% that's not going to be as competitive as if you have a black rock staking product and it's 15 pips. So this idea of having an earn vault where we have these curated blue chip strategies that is a terrific selling point and effectively it's a strategy on a shelf and if we package that up right and we have the right integrations like again I would see tremendous inflow opportunities from that. >> So that's an interest that's kind of a funny picture you're painting. I never thought about it that way that the ETSs and the debts will like basically [clears throat] like you're essentially having this institutional product arms race right now, right, of like everybody is developing a product that will ideally be the ones that attract a lot of this institutional money and even the institutions themselves are the ones

creating it. >> Yeah. Like obviously ultimately the goal will be make the pie bigger, don't fight over pieces. >> But I think like obviously the D codes have a big advantage. They're they're live. they're in production for lack of a better term and people are investing. But when staking gets added to the ETFs, will a lot of that capital flow from the DACO to the ETFs? That's obviously still to be seen. I kind of see a world where the DACO will probably buy the ETFs so they can diversify. Um, but again, like I said, for the DACA, I think to be ma to remain competitive, they're going to have to be a lot more creative on their DeFi strategy and they're going to have to generate higher yields to compete with like a Black Rocker or a Fidelity where inevitably they will launch

products and they'll probably have no fees on it for the first year. So, I think that's when you'll see an interesting battle take place. >> Yeah, that makes sense. Okay, thanks for explaining that. Last question for you guys before we wrap out. Um, would you ever expand beyond ETH? >> And so we used to >> refer to Izzy on this. Yeah. >> Uh, like Lido used to be a multi multi-protocol network. Um, >> yeah, I remember I feel like I did you have Salana at some point? I feel like I went on there and there was Salana. >> Yeah, there was there was Leido on Salana, Letoido on Polygon, Leido on Polka Dot and Kusama.

>> Uh, there was an idea a glimmer in somebody's eye for Leo on Avalanche at some point. Um, and I feel like I'm missing one, but I'm I'm going to Oh, so there was um like a a lido on Cosmos, which eventually the team that was working on that spun out and created Neutron. Um the I think it was the right bet at the wrong time. So, what we're going to see uh and I think you're seeing it to a certain extent like in the way that these institutional ETFs are playing out is >> eventually you will you will want like a staking basket. you will want really good staking yield from the majors from ETH, from Salana, from you know, Avalanche, um, etc. I don't know if Bitcoin is ever become proof of stake, like probably not, but you know, Justin

Drake has famously said that at some point like Ethereum will subsume Bitcoin and it'll just be a layer two on on Ethereum. Um, I don't think that's going to happen, but it would be an interesting thought, but like that is the right kind of thing because eventually somebody's going to like want buy a basket of this. Um and Vanek is kind of like executing the strategy, right? They have they have their staked salt ETF which is powered by Getool. They have their staked ether ETF which is powered by Lidos ST. Um and it's it is something that can make sense like if it if it happens to make sense again. Um I just think that that the biggest difficulty that we faced at the time was each network um really has its own kind of like culture and vibe. uh and if you're if you can't compete locally

natively, I guess if you want to think about it this way, um it's very hard to compete at all. And the other big problem is that uh how crypto life cycles work. So there's a bunch of new projects, they raise money and then they spend it all like in the first couple of years. So if you're a project like Lido that wants to compete on multiple networks, you have to compete with multiple local uh upstarts, if you want to think about it, this that have a war chest that they're spending only for that network. Um, and it's it's it's basically like very very difficult to uh make meaningful uh inroads in in in that way. Um, I think eventually it it'll make sense. Uh, we will probably see a shuffling of like what is a crypto major in the next couple of years. So maybe

it'll make sense to revisit once once that's kind of like settled. >> It's a good perspective. Yeah, because now now I think of it, I was like I remember coming to the site and there's all these other options and now you've just focused on ETH. But I think that's smart. I don't think there's anything wrong with that. I think you have to just stick with your winners. You know >> that said um like ETH as a as a token as a currency is everywhere. Uh right, it's not only on Ethereum and Lido earn does not have to be an ETH only thing. So I think uh on light earn it'll make sense that if we start doing like omni omni network kind of activities uh they'll first be surfaced on earn um and then if it makes sense to recreate a staking product on one of the other majors um it

it'll be based on a very successful uh product that that comes through lightarn. >> Got it. Okay. Awesome. All right guys well thanks for explaining all I mean, I'm very excited for you. Been able to been following Lido for a long time and and it's great to kind of look under the hood and have a lot of stuff explained to me. So, I hope I hope maybe I'll clip this for for future use for people that don't don't fully understand all this stuff. Is there anything else we should know before we wrap up? >> No, thank you so much for having us. You're very kind. >> Of course, Kian, Izzy, guys. Uh, check out Lido Earn and B3 coming out and, uh, for your sake, gentlemen. I hope that the government reopens soon and you can get your your ETF approved, which would be very exciting. Uh, thank you

everybody for listening to Milk Road Daily Show. Uh, we'll be back here tomorrow. We have a few more great guests coming up this week. Um, and like I said at the start of the episode, if you know anybody who's like a graphic designer, video editor, please send them our way. Uh, it would be very nice to work with them. Otherwise, we will see you tomorrow. If y'all are making swaps or trades right now, highly recommend you check out Milkroad Swap. This is a DEX that we built in partnership with Cow Protocol. Why did we build it? Not to make money, just honestly. we could have a place to do our swaps for the lowest fees that we could find. This is the fees on Ethereum, Arbitum, and Bass are only.15% fees. Uh this is a huge difference from uh other centralized exchanges that

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