dForce Collaborates with Lido to Power the Adoption of $wstETH on L2s

Published in
4 min readFeb 3


We are happy to announce our collaboration with Lido Finance to power the wide adoption of $wstETH on Arbitrum and Optimism.

dForce recently receive $LDO grants from the Lido community, which will be utilized to reward users of $wstETH by lending and borrowing from the dForce protocol on Arbitrum and Optimism, as agreed by the dForce community through DIP-034.

The proposed distribution of $LDO will start from 12:00pm UTC, 3 February with the following schedule (subject to Lido’s monthly reWARD budget planning):

Click here for a hands-on guide.

We also plan to launch another vault for wETH/wstETH Curve LP tokens on Arbitrum and Optimism in about 1~2 weeks, allowing users to further enhance capital efficiency, and earn ETH staking yield, $LDO, and $CRV simultaneously.

What can I do with my $wstETH on dForce?

To facilitate wide adoption of $wstETH, dForce proposed to enable $wstETH as not only a collateral asset but also a borrowable asset, meaning that you can borrow $wstETH against any supported assets on dForce Lending.

This demonstrates many interesting opportunities for the Lido community. On one hand, you can earn passive yield on your $wstETH holdings by depositing into dForce; on the other hand, you can borrow $wstETH against any assets supported on dForce Lending, interacting with more protocols and unlocking more DeFi yield.

Example 1: deposit $wstETH and borrow $ETH to earn $LDO token rewards.

Example 2: deposit $wETH and borrow $wstETH and provide liquidity on Curve to earn $LDO rewards.

Example 3: deposit $wstETH and borrow $USX and $USDC to earn $LDO, $DF, $VELO rewards.

Partnership between the Two Communities with Mutual Benefits

We strongly believe this integration demonstrates a great opportunity for both communities. dForce’s support will help further expand the utilization of $wstETH and enhance its ability to interact with other DeFi applications and assets in a meaningful way on different layers and blockchains.

More importantly, this integration will help further improve $wstETH’s peg by increasing its liquidity on Curve and other DEXes — the more liquidity there is, the less volatile the peg should become, and the easier it is for users to take advantage of the different strategies which will bring $wstETH back to its peg.

dForce announced collateral support to $wstETH on Ethereum in December 2021 and has contributed 5,634 newly minted $wstETH (or >$9m in dollar value) from our referral link: 0x0cf797324f358aca98acfc9cb94d14c9738921f7 since then. And total $wstETH supplied to dForce amount to more than 7K (or $11.5m in dollar value) as of today.

dForce now ranks #2 on Arbitrum with a total holding of 5,000 $wstETH, and #4 on Optimism with a total holding of 2,224 $wstETH.

About Lido Finance

Lido is an ETH-staking protocol that allows people to continue using an ETH staking derivative across the DeFI ecosystem while their ETH earns rewards.

stETH is a token that represents staked ether in Lido, combining the value of initial deposit + staking rewards. stETH tokens are minted upon deposit and burned when redeemed. stETH token balances are issued 1:1 to the ethers that are staked by Lido. stETH token’s balances are updated when the oracle reports change in total stake every day.

Lido’s wrapped stETH (wstETH) is stETH which is deposited into the stETH wrapper to create a new token called wstETH. Wrapping stETH creates a DeFi-compatible version of the stETH token which allows for easier integrations with DeFi protocols.

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