What is steth coin? What are the characteristics of steth coins?

Staking derivatives STETH coins can obtain ETH staking income in the Lido protocol, while providing liquidity, participating in governance, and no lock-up period.

STETH Coin

Introduction

STETH coin is an Ethereum pledged derivative token issued by the Lido Finance platform, representing the ETH pledged by users in the Lido protocol.

Features

• Linked with ETH: STETH currency is linked to the value of ETH, 1 STETH = 1 ETH.
• Pledge income: Holding STETH coins can obtain the income from pledging ETH in the Lido protocol. The rate of return is related to the pledge rate of ETH.
• Liquidity: STETH coins can be freely traded on decentralized exchanges and centralized exchanges, providing liquidity.
• Participate in governance: STETH currency holders can participate in the governance of the Lido protocol through the Lido governance token LDO.
• No lock-up period: Unlike ETH staking, STETH coins have no lock-up period and users can withdraw their ETH at any time.

Purpose

• Staking income: Obtain ETH staking income without pledging ETH yourself.
• Liquidity: Provide liquidity while maintaining ETH staking income.
• DeFi Application: Can be used as collateral or liquidity provider in DeFi protocols.
• Hedging: Can be used to hedge ETH price fluctuations.

Risk

• ETH Price Fluctuation: The value of STETH coins is linked to the price of ETH and is therefore affected by ETH price fluctuations.
• Smart contract risk: STETH currency is based on the smart contract of the Lido protocol, and there is a risk of smart contract vulnerabilities.
• Liquidity risk: Under extreme market conditions, the liquidity of STETH coins may decline.

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