Lido begins biggest overhaul of $16.5B in staked ETH, CoinDesk reports

Lido, the liquid staking protocol behind LDO, has begun its largest-ever upgrade, migrating around 8 million ETH worth about $16.5 billion into a new validator structure, CoinDesk reported. The upgrade applies the new validator structure introduced in Ethereum's Pectra upgrade last year and aims to reduce the total number of Ethereum validators by about one-third, easing the burden on the consensus layer. Lido is also shifting professional node operators to its curated module v2, or CMv2. As a result, node operators will be required to post a set amount of ETH as collateral for the first time since Lido launched, and a penalty mechanism will be introduced for weak operating performance.