Lido consolidates $16B in staked ETH with Curated Module v2

Lido moved more than 8 million ETH, roughly $16 billion, onto larger 0x02 validators as Curated Module v2 went live today. The transfer shifted about one-fifth of all staked ETH managed by the protocol onto validators that can hold up to 2,048 ETH each instead of the prior 32-ETH limit.

Curated Module v2 is the permissioned node-operator layer that already manages over 90% of Lido’s staked ETH. The module requires professional, DAO-approved operators to post ETH as collateral. That bonded collateral can be seized to cover slashing events, incorrect execution-layer rewards or other operational failures. Lido described the bond as smaller than what a fully permissionless system would require and said the intention is to align operator capital with performance and add protection for stakers.

The upgrade uses the 0x02 validator type introduced by the Pectra hard fork in May 2025, which raised the effective balance ceiling per validator to 2,048 ETH. By consolidating stake onto the larger validators, Lido raised the share of its staked ETH on 0x02 validators to about 52%, up from roughly 32% prior to the migration. Lido expects Ethereum’s total validator count to fall by about one third as fewer validator instances will be needed to hold the same amount of ETH.

Lido began planning the migration earlier in the year and estimated the process could take up to six months. During reallocation, the protocol anticipated missing about 738.5 ETH in protocol rewards while assets are unstaked and re-deployed. Lido reported that rolling out CMv2 required technical and operational scoping plus multi-stage testing with node operators, researchers and auditors.

The CMv2 release coincides with an update to Lido’s permissionless layer, Community Staking Module v3. The CSM v3 adds a Distributed Validator Technology route that splits validator duties and keys across four independent operators to reduce slashing and downtime risk. Community staking participants already post an ETH bond; under CSM v3 the same bonded capital can support more staked ETH, which Lido says improves capital efficiency for smaller stakers.

Lido is a major infrastructure provider in Ethereum staking and is used by institutional custodians and product issuers to support staking services and staking-linked investment products. The protocol has faced scrutiny over concentration of staked ETH; the operator bonds and the DVT route address related governance and operational risks.

Network data show Ethereum’s percentage of ETH staked has risen toward roughly 35% and validator entry queues have increased since last year’s high exit queues. Staking yields across the network have compressed; Lido reported revenue of $40.5 million in 2025, a 23% decline from the prior year, reflecting lower per-ETH rewards.

Isidoros Passadis, chief of staking at Lido Labs Foundation, described the upgrade as “the biggest change to how Lido Core staking works since Lido V2.” Lido also noted the rollout involved coordination with multiple parties and extensive testing before the new modules were activated.