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# Lido Finance

<figure><img src="/files/bQ7jEsz1KdJFoD5liWOP" alt=""><figcaption></figcaption></figure>

Lido Finance addresses a fundamental challenge in the staking ecosystem: liquidity. By allowing users to stake their tokens through Lido, they receive stETH (staked Ether) tokens in return. These tokens represent a user's stake in the Ethereum 2.0 Beacon Chain, enabling them to participate in network validation and earn rewards, all while maintaining the ability to trade or use their staked assets elsewhere in the DeFi space. This liquidity unlocks opportunities for yield farming, borrowing, and trading without the usual constraints associated with locked-up assets in traditional staking models.

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