Decentralized Finance Project (DeFi) Lido Finance has voted overwhelmingly against supporting the new Terra blockchain, with less than 5.5% voting in favor. The revitalization plan was approved today by Terra's network validators.
- Lido, a liquid staking protocol, is DeFi's fourth largest platform with a total value of $8.43 billion locked up, according to DeFi Llama.
- Kwon's proposal is to perform a hard fork of the blockchain, with the original chain continuing as Terra Classic. The new chain will focus on attracting DeFi applications.
- In a hard fork, the chain running a protocol is split in two, with the new branch using different rules. For Terra, this is an opportunity to reset its failed project after native stablecoin UST and sister token LUNA collapsed to near zero earlier this month.
- Initial reaction to Kwon's plans was largely negative, however, with about 92% of the 6,220 Terra community members voting against the change.
- Goldman Sachs, in a note published Friday, called Lido an example of how decentralized finance can amplify systemic risk, citing the protocol's links to Terra's Anchor protocol.