21Shares, a provider of crypto exchange-traded products (ETP), has introduced a way for traditional investors to gain exposure to Lido DAO. The Switzerland-based company’s issue-specific summary states that “21Shares Lido DAO ETP (LIDO) is a non-interest bearing, open-ended security. Each series of the product is linked to an index or specific underlying asset Lido DAO.” The products are available to the public in 22 European Union countries, including France, Germany, and Portugal, and are traded on several exchanges such as SIX Swiss Exchange, BX Exchange, and the Stuttgart Exchange. The ETP currently has $100,000 in assets under management (AUM), compared to 21Shares’ total AUM of more than $1.1 billion.
21Shares has classified this product as “high risk” in several categories, including market risk, regulatory risk, secondary market risk, risk of the occurrence of an extraordinary event, and the risk of a quick change in the value of a crypto asset that could drop to zero. Megan Enright, 21Shares communications manager, noted that “this risk indicator aligns with the risk classification of products offered by other issuers as well, which take historical prices into account, and is set by the regulatory framework. Even in the traditional finance space, it is not uncommon to see risk factors of 6 or 7.”
Liquid staking enables users to maintain liquidity, despite locking their cryptocurrency to earn rewards for securing a blockchain network. Lido, the dominant liquid staking player, has more than $13 billion ETH staked, commanding a 76% market share of liquid staking derivatives on Ethereum, according to data from blockchain analytics firm Nansen.