Liquid Staking Giant Lido Moves 8 Million ETH Onto New Validators to Ease Ethereum Network Load
Lido, the largest liquid staking provider on Ethereum, has activated a major upgrade to its core protocol, moving more than 8 million ETH (approximately $16.5 billion) onto Ethereum’s newer validator design. The migration, announced Monday, shifts roughly a fifth of all staked ETH from older 0x01 validators to 0x02 validators, a format made possible by Ethereum’s Pectra hardfork earlier this year.
Pectra allows a single validator to hold up to 2,048 ETH, replacing the previous 32 ETH cap. This consolidation enables operators to manage thousands of validators with far fewer entities while securing the same amount of staked ETH. For Lido, the share of its staked ETH on 0x02 validators will rise from about 32% to roughly 52%. Once complete, the migration will cut Ethereum’s total validator count by nearly a third.
Fewer validators processing the same stake reduces the data load on Ethereum’s consensus layer, accelerating finality and lowering operational costs. “This is the biggest change to how Lido Core staking works since Lido V2,” said Isidoros Passadis, Chief of Staking at Lido Labs Foundation. “The node operators securing the majority of ETH staked via Lido are consolidating onto far fewer validators, and for the first time, they’re backing that stake with their own capital.”
The upgrade, called Curated Module v2 (CMv2), also introduces a significant change for operators. For the first time in five years, curated node operators must lock ETH bonds to cover risks such as slashing, execution layer rewards violations, and operational failures. Previously, the Curated Module relied on reputation and track record. Bonds have been required for Lido’s permissionless Community Staking Module since 2024, but CMv2 extends that requirement to professional operators handling the bulk of Lido’s staked ETH.
A separate upgrade, CSM v3, adds a new operator category called Identified DVT Clusters, targeting verified community stakers who use distributed validator technology from providers like Obol or SSV. Splitting a validator across independent operators reduces slashing and downtime risk, allowing a smaller bond relative to the stake backed.
No action is required from stakers holding stETH; their holdings remain unaffected. The migration will proceed over the coming months, paced by Ethereum’s activation queue. Lido also flagged a later phase, expected around Q1 2027, that would introduce a marketplace where operators compete for stake based on fees and performance.