Revising the Bull Market Expectation for $LDO

Previously, I believed there was still four times the growth potential for LDO's ETH staking volume, meaning that the staking rate of ETH and LDO's market share in the ETH staking market could both increase from 30% to 60%.

However, I no longer believe that LDO's share in ETH staking can necessarily increase to 60%, based on the following two reasons:

1. Strong competitors have emerged in the market, such as ETHFI. Before this surge, I researched ETHFI but ultimately did not purchase, as ETHFI's price-to-earnings ratio under full circulation is inferior to LDO's, and it does not hold the leading position as LDO does. However, ETHFI has three advantages: first, a lower circulation rate, which is better for price increases; second, it has an actual dividend mechanism that uses a portion of the protocol's income for token buybacks to distribute dividends; third, there are some additional businesses and the reuse of liquid staking.

The recent surge of ETHFI, while influenced by market manipulation, also reflects the confidence of the underlying capital and the recognition of the market.

I am uncertain if LDO can maintain good growth amidst increasingly fierce competition.

2. Recently, LDO passed a proposal granting governance rights to stETH holders, which is a good thing and reflects the LDO community's good vision and values.

However, the positive effects of this are taking too long, and the underlying issue is that LDO is too left-leaning. I do not believe that LDO is at a stage in the market where it can be complacent and focus on establishing good systems. In the early stages of market development, more aggressive and centralized organizations have a better chance of capturing more market share (provided that they are aggressive but make correct decisions).

This reminds me of the comparison between SOL and ETH over the past two years. The benefit of being left-leaning is a higher lower limit, but the short-term upper limit may also be lower.

Of course, as ETH rises, seeing LDO above 3 is still not a problem for me. I will buy on dips, but I will lower my expectations.