On July 27, Lido kicked off its biggest Core Protocol upgrade since Lido V2 by shifting over 8 million ETH to Ethereum’s updated validator format.
This stake represents roughly $16.5 billion, about 20% of all ETH staked, now migrating from Ethereum’s older 0x01 validators to the newer 0x02 validators enabled by the Pectra hardfork earlier this year.
The Pectra upgrade allows a single validator to hold up to 2,048 ETH, compared to the previous 32 ETH limit. This lets operators combine thousands of validators into fewer units without sacrificing staked ETH security.
As a result, Lido’s share of ETH staked on 0x02 validators will jump from around 32% to about 52%, cutting Ethereum’s total validators by nearly a third once migration finishes.
Fewer validators processing the same stake means less data for Ethereum’s consensus layer to handle at every slot, speeding finality and lowering operational costs.
Isidoros Passadis, Chief of Staking at Lido Labs Foundation, described the shift as the largest change since Lido V2. Operators backing most ETH staked via Lido now consolidate onto fewer validators and, for the first time, put up their own capital to secure the network.
This upgrade, dubbed Curated Module v2, also introduces a new requirement: Curated Node Operators must lock ETH bonds to cover risks like slashing and operational failures.
Previously, operator selection mainly relied on reputation and track record, but now capital backing adds an extra layer of security for this professional operator group.
The bonding system has been part of Lido’s Community Staking Module since 2024, but CMv2 extends this to the main node operators handling the majority of staked ETH.
Another improvement, CSM v3, introduces Identified DVT Clusters, allowing verified community stakers to run validators together using distributed validator technology.
