THE RISKS OF LSD

Summary from the TLDR Crypto newsletter

This post explains how Liquid Staking Derivatives, including Lido, present potential threats to the Ethereum protocol due to possible cartelization and centralization. While this was written over a year ago, it’s still relevant as LDO has gained nearly 33% share of staked Ether. The author suggests self-limiting to avoid any potential issues and advises capital allocators to be conscious of these risks and limit allocation to LSD protocols that exceed 25% of total staked Ether.