Diversified LSD baskets like $LSDETH and related EVM/POS products with PowerAgents auto-harvesting of intrinsic and extrinsic yield with deposit insurance will be marketed to small retail savers globally as an insured 'savings account' for the ETH economy paying passive HODLs/savers real yield generated by ETH POS operations/Validator networks financing the 32 ETH stakes Validators need.
The $LSDETH basket spreads all risks via a diversified mix of carefully monitored, performance-based re-balancings of eligible LSD operators like Lido, Stakewise, Stadler etc. adding a wrapper of re-insurance sourced from a specialised Nexus Mutual syndicate to protect small savers (say, withdrawals of less than $50,000). Larger investors will contribute to the Safety Fund on minting, but unless they split their wallets into balances less than $50,000, they will not be fully covered by deposit insurance. This replicates the TradFi approach of having large institutional savers finance deposit protection for small savers.
Demystifying Liquid Staking Derivatives
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