Lido launched a significant upgrade, Curated Module v2, enabling the transition of 8 million ETH to new validators and enhancing staking efficiency.
On July 27, Lido, a leading liquid staking protocol, launched the Curated Module v2 upgrade, which will facilitate the transition of over 8 million ETH, valued at roughly $16 billion, to new 0x02 validators.
This upgrade is a significant step for Lido Core, introducing various enhancements to align with Ethereum’s roadmap and ensure the protocol's long-term sustainability. Importantly, stakers will not need to take any action as the upgrade occurs at the protocol level.
The 0x02 upgrade will increase the ETH limit per node from 32 to 2048 tokens, allowing Lido node operators to manage more staked tokens with fewer validators. This change is expected to boost the share of ETH staked under the new standard from approximately 32% to about 52%, while the total number of validators on Ethereum may shrink by one-third, thus lightening the load on the blockchain.
Key Features of Curated Module v2
Isidoros Passadis, head of staking at Lido Labs Foundation, described this upgrade as the most significant transformation since the protocol's second version. The Curated Module has been operational since 2020 and currently holds around 90% of the staked assets on the platform. Previously, the module relied on a reputation-based model, where the DAO selected professional operators expected to cover any losses.
With the new version, operators will need to stake their own ETH as collateral, which can be lost in cases of slashing or other failures. This new requirement aims to tie operators' capital to their performance quality, providing better protection for stakers, while the reputation model remains in place.
Operators will also be categorized into three distinct groups with different incentives:
- Decentralization Operators — focus on launching nodes in underrepresented areas;
- Extra Effort Operators — contribute beyond basic maintenance through capital investment and active participation;
- Public Good Operators — develop and maintain Ethereum’s client infrastructure.
As of July 1, 2026, seven client development teams within the Curated Module have collectively earned 8710 stETH, equivalent to about $21 million in rewards.
Governance changes will also streamline operations. Routine administrative tasks, such as changing an operator's address, will now be managed by the operators and the Curated Module Committee, reducing delays in addressing urgent issues, while the DAO retains control over key parameters.
The transition from the old module will take some time, with a validator activation queue exceeding 40 days. Lido developers estimate the migration period will last around six months, with potential missed rewards of approximately 738.5 ETH during this time.
Additionally, the third version of the Community Staking Module (CSM) was launched, which caters to solo stakers and small teams. This module currently represents over 770,000 ETH, about 8.5% of Lido's total value locked and 1.9% of staked ETH.
A notable update in CSM is the introduction of Identified DVT Clusters (IDVTC) for those launching distributed validators, providing higher capital efficiency compared to solo staking. The new module allows for multiple addresses for reward distribution, essential for clusters dividing payouts among participants.
Meanwhile, the Simple DVT module is being phased out, with 72 regular clusters closed following a vote. Operators of these clusters can transition to the CSM. A separate module for 0x02 validators is anticipated to launch in Q4 2026, although the current upgrade does not encompass this capability.
In January, Lido also deployed the v3 upgrade featuring modular stVaults infrastructure on the mainnet, further enhancing its offerings.
