• Major VCs such as Dragonfly and Wintermute observed massive gains in their LDO portfolios over the last few months.
• The overall velocity of LDO declined, with whales losing interest in the token.
• Despite this, Lido’s revenue and unique depositors have seen an increase.
VC Funds Capitalize on LDO Token
Major Venture Capital (VC) funds such as Dragonfly and Wintermute have seen massive gains in their respective portfolios due to investments in the Liquidity Deficit Offering (LDO) token. Their portfolios grew by 39.2% and 17% respectively over the last month, with LDO making up a prominent part of their holdings. Paradigm fund, whose portfolio was almost entirely comprised of 90% LDO tokens, saw a 40% growth in the past month.
Whales Shy Away from LDO
Though VC funds are profiting from their investments into LDO tokens, investors should still proceed with caution. Over the last month, it has been observed that the overall velocity of transactions involving these tokens has decreased, indicating that whales are losing interest in them. However, new addresses continue to be attracted to these tokens as network growth increases.
Lido Rakes In Cash
The number of unique depositors on the Lido protocol has also increased according to Dune Analytics data – 123,840 depositors were present at the time of writing – which has resulted in a 32% increase in revenue for Messari’s data. This spike has contributed to an increase in its treasury funds which isn’t yet being put towards any upgrades or updates on its protocol as evidenced by declining code commits on GitHub.
Should You Invest?
Despite improvements seen within the protocol itself such as increasing revenue and number of unique depositors, on-chain metrics indicate that investors should be wary when investing into LDOs . If these treasury funds are invested into actual updates for its protocol however, future prospects may look brighter for both token holders and developers alike.
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If you’re looking for more information regarding your potential profits off LDOs then check out our very own Profit Calculator here!