[EGG] Lido Labs BORG Foundation Grant Funding Request

[lidolabs-operations]

UPD 14/03/2025: As part of internal discussions, contributors have made wording clarifications in the proposal. The requested amounts remain unchanged. For transparency, here’s the IPFS link to the original proposal: https://ipfs.io/ipfs/bafybeieivkxu3yt5z7qvxq5kthvlbntpamjvvidnewih6aer42oyvcpxqa.

tldr

Seek grant approvals through 2025-12-31 to the Lido Labs BORG Foundation to advance protocol research, development, and governance initiatives with a focus on Lido v3 implementation, as well as facilitating maintenance of the Lido on Ethereum protocol.

Basic Data

Field	Description
Proposal Name	Lido Labs BORG Foundation Research, Development and Maintenance Initiative
Which of the following GOOSE goals is your proposal advancing?	GOOSE-2 goals: #1 Lido DAO Has Effective and Decentralized Governance; #2 Lido protocol Attracts the Best Validator Set in the Market; #3 stETH is the most used token in the Ethereum ecosystem
Proposed scope of work	Protocol R&D, Lido v3 Implementation, Dual Governance Development, Security Research, and facilitating maintenance of the Lido protocol
Objectives	1. Drive technical research and development for Lido v3 Staking Infrastructure for a diverse product line, 2. Strengthening DAO Governance Infrastructure and Decentralization, 3. Advance Decentralization of Ethereum, 4. Lead Protocol Research Initiatives
Total Budget Request and Best Before Dates	Budget request includes $34.88m through 2025-12-31.

Lido Labs BORG Foundation Grant Funding Request

	1-Decentralised Governance	2- Validator set	3 - stETH Adoption	4- Support	Grand Total
G&A	0.34m	2.03m	0.83m	10.08m	13.28m
R&D	7.60m	5.25m	5.44m	3.31m	21.60m
Grand Total	7.94m	7.28m	6.27m	13.39m	34.88m

Strategic Priorities

1. Drive technical research and development for Lido v3 Staking Infrastructure for a diverse product line

• Advance the technical development of Lido V3 through:
  • Creation of technical architecture specifications and documentation
  • Development and testing of Lido Core and stVaults architecture allowing custom staking setups with access to stETH liquidity
  • Development of smart contracts, oracles, services, and tools for the Lido V3 staking infrastructure
  • Security audits and test suites
  • Integration support for Early Adopters

Key Performance Indicators:

• Development milestones achieved
• Security audits completion and resolution
• Successful testnet deployments and mainnet Lido on Ethereum protocol upgrade under the Lido DAO design and implementation approvals
• New staking product lines and integration cases launched

2. Strengthen DAO Governance Infrastructure and Decentralization

• Dual Governance Release – Launch and integration into governance processes
• Research the ways to align long-term LDO holding with the success of Lido on Ethereum and propose approaches to the DAO
• Governance Tooling Improvements – Reducing voting fatigue, increasing efficiency, and ensuring DAO accountability.
• Governance Documentation & Guidelines – Maintaining transparency through clear, up-to-date governance materials.
• Community Education – Expanding awareness and engagement in governance processes.
• On-Chain Security & Operations – Ensuring secure, error-free execution of DAO transactions and committee actions.

Key Performance Indicators:

• Active Voting Power – Tracking participation levels in governance.
• Operational Security – Zero critical errors in governance execution.
• Attack Vectors Mitigation – Strengthening governance resilience
• Community Engagement – Measuring involvement in discussions, proposals, and education initiatives.

3. Advance Decentralization of Ethereum

• Strengthen protocol and network security and decentralization through:
  • Increased permissionless participation via either upgrades and increased scaling of current permissionless modules (CSMv2) or new modules proposed and developed by the community (SSVLM)
  • Further research into optimal node operator and validator sets, and continued best in class transparency and community betterment via initiatives such as VaNOM and DUCK (open source institutional grade controls and risk framework for node operators)
  • Upgrades to the Lido protocol to adapt to new Ethereum features, such as Triggerable Withdrawals and increased Max Effective Balance, which increase protocol security and optimize protocol network footprint

Key Performance Indicators:

• Percentage of stake operated using DVT and via permissionless entry
• Number of unique node operators
• Distribution and decentralization of stake
• Maintenance of leading protocol performance
• Maintenance of leading rewards effectiveness

4. Lead Protocol Research Initiatives

• Research the impact of EIPs on Lido protocol to provide contextual analysis and develop strategies for minimizing potential risks to the protocol
• Develop research contributions at the intersection of Ethereum and the Lido protocol to actively participate in protocol discussions (e.g. research into scalability solutions, investigation of new staking mechanisms)
• Explore the design space for an open validator market within Lido protocol, enabling differentiated service offerings and a dynamic fee structure that aligns rewards with each validator’s risk profile and decentralization impact
• Analyze market and industry signals to anticipate the major market shifts and provide strategic options for Lido protocol’s growth enabling proactive responses to emerging trends
• Explore opportunities to enhance protocol revenue and drive greater user engagement in Lido protocol’s staking ecosystem (e.g. exploration of cross-chain opportunities)

Key Performance Indicators:

• Research papers published
• Technical proposals published on research forums
• Broad Ethereum-wide research participation
• Community feedback on research initiatives

Additional Info

LDO token holders have approved that Lido Labs BORG Foundation oversees and legally “wraps” the LEGO committee (0x12a43b049A7D330cB8aEAB5113032D18AE9a9030). LEGO committee continues its existing grant (quarterly limit of $0.5m with LDO share <= 20%) to further ecosystem grants and experimentation as originally approved.

Next steps

If the proposal is supported, funding for disbursement to finance Lido Labs BORG Foundation would be requested from the DAO via Easy Track motions to the operational multisig (0x95B521B4F55a447DB89f6a27f951713fC2035f3F).

Lido Labs BORG Foundation will aim to deliver quarterly community calls to review accomplishments and key results and actuals reporting.

[Nansen]

As a relatively new participant in the governance forum, we may have missed prior discussions that address some of the questions below. We’d appreciate if the proposal could be updated with relevant references for completeness and ease of comparison.

Budget Granularity

The budget is broken down into broad categories with a split between G&A and R&D. However, additional granularity on specific budget items (e.g., activities within R&D and Support, legal and compliance, audits, outsourcing, training, etc.) would provide better benchmarking and comparative analysis.

• How does this budget compare to other (staking) providers?
• What are the key increases or decreases compared to previous years?
• Are there specific cost drivers that have led to significant budget changes?

Outcome Measurement

The proposal outlines broad objectives—such as Lido v3 implementation, dual governance, security improvements, and research—but many of the KPIs are open-ended and lack clear, measurable success metrics.

For instance:

• How will the success of validator set expansion be measured? Will it be based on the number of new operators onboarded or decentralization metrics?
• What specific milestones or benchmarks will be used to track progress?
• Consider rewriting KPIs into a OKR format at least into a impact and measurable format

Greater clarity on these KPIs would improve accountability and help assess the proposal’s impact over time.

Sustainability & Forecasting

Has the budget factored in recent market conditions? Treasury assets and revenue have declined significantly with the market cooldown over the past month. While many initiatives aim to enhance long-term sustainability, understanding how budget allocations were prioritized and whether the plan is financially viable under current conditions would be helpful.

• How does this budget compare to prior years’ requests?
• How much of last year’s budget was utilized, and were there unspent funds?
• Has contingency planning been considered? For example, if market conditions worsen, would this budget constrain other initiatives?

Incentives & Accountability

It may be worth considering performance-based spending unlocks on a quarterly basis. This approach would:

• Ensure funds are allocated to high-impact initiatives.
• Allow for adjustments based on delays or evolving market conditions.
• Hold contributors accountable for progress, timeliness, and stakeholder engagement.

[lidolabs-operations]

Thank you for your questions! The responses aim to be clear, concise, and transparent; feel free to ask further questions if any.

@Nansen

What are the key increases or decreases compared to previous years?

Last year’s EGG requests were semi-annual, while this year’s funding covers 3 months (Multi-EGG) + 9 months. Overall, the total annual grant request remains similar.

For transparency, last year’s budget utilization for the Lido Contributors Group(LCG) was underspent by ±38%. Multi-EGG has similarly underspent, with ±$6.5m drawn to-date from the total $11.1m request. Generally, although forecasting accuracy has been difficult for the group, it also allows for some leniency during periods of market volatility and generally the Foundation is mandated to run a tight ship with prudent use of grant assets.

@Nansen

Are there specific cost drivers that have led to significant budget changes?

Nothing specific, nor any major changes compared to 2024. It’s important to note that protocol maintenance requires significant resources, even though it may not be as exciting to assess as new initiatives.

@Nansen

Outcome Measurement

First of all, the foundation hopes today’s proposal update has improved transparency regarding Outcome Measurement. However, let us highlight a few key points for clarity.

@Nansen

How will the success of validator set expansion be measured? Will it be based on the number of new operators onboarded or decentralization metrics?

Validator set expansion will primarily be measured by:

• Percentage of stake operated via DVT and through permissionless entry
• Number of unique node operators
• Stake distribution and decentralization

Tracking and reporting on validator set metrics can be found in VaNOM. Additionally, Lido Scorecard provides insights into decentralization and security.

@Nansen

What specific milestones or benchmarks will be used to track progress?

To be fully transparent, the foundation is currently developing a structured process for setting and reporting on specific milestones and targets.

The foundation aimed to outline key research directions and upcoming releases in this proposal. The foundation remains committed to enhance progress tracking transparency and, after considering factors like format, legal guidelines, tooling, cadence, and reporting mechanisms, will introduce quarterly reporting to keep tokenholders and the community informed on results and future plans.

@Nansen

Consider rewriting KPIs into a OKR format at least into a impact and measurable format

The foundation has updated the proposal wording to better define key outcomes aligned with GOOSE objectives. Please review the latest version, hope it’ll be clearer. Additionally, the foundation will aim to report progress towards key OKRs in a quarterly cadence.

@Nansen

Sustainability & Forecasting

Has the budget factored in recent market conditions?

The Treasury Management Committee is charged with developing automated strategies for ensuring that grants can continue to be disbursed throughout market conditions, and has executed on plans to raise approximately a year’s worth of operating grants in stablecoins today through various non-custodial motions. The plan is therefore financially viable, without drawing down on stETH, for at least 12 months, though prudent application of TMC motions with DAO surplus ensures that the effective runway is multi-year.

Should market conditions worsen through to the first half of the year, the Foundation will propose and communicate on wind-downs of grant activity in order to extend the runway as far as possible.

@Nansen

• How does this budget compare to prior years’ requests?
• How much of last year’s budget was utilized, and were there unspent funds?

Answered above.

@Nansen

Has contingency planning been considered? For example, if market conditions worsen, would this budget constrain other initiatives?

No, but there is precedent for adapting goals in response to market changes—reGOOSE in 2024 was introduced for this reason.

@Nansen

Incentives & Accountability

It may be worth considering performance-based spending unlocks on a quarterly basis.

For now, the #1 priority is to keep operations efficient while maintaining accountability. The DAO can object funding via EasyTrack at any time, ensuring oversight.

The foundation draws funds monthly based on actuals, with a $18M quarterly limit. Most of the grant remains in the Treasury until needed, and LDO holders can halt funding via EasyTrack at any moment if adjustments are required.

[BlockworksResearch]

Disclaimer: All of the following information was pulled from Blockworks Advisory Lido Governance Manual & Steakhouse Lido Dune Dashboards (and forum posts).

Acknowledgements

Thank you, lidoecosystem-ops and lidolabs-operations for putting this information together! In general, all of the objectives of the Ecosystem BORG & Labs BORG fall in line with the brief description of strategic priorities.

General Thoughts

For the community, and to answer @Nansen’s well-timed question, “What are the key increases or decreases compared to previous years? / How does this budget compare to prior years’ requests?” it appears that:

• G&A has increased YoY to level off in 2025
• Excluding 2022, R&D has increased YoY at around 55%
• S&M has stabilized in 2025

To further explore another one of Nansen’s questions, “Are there specific cost drivers that have led to significant budget changes?” we have to look at the previous variance by budget period and back out these numbers. (Disclaimer: H2 of 2024 and ongoing Q1 of 2025 budgets have not been reviewed)

The average variance across all budget period categories is 39%. A rough approximation for 2025 end spend is then:

• General & Administrative: $4,989,800.00
• Research & Development: $24,265,800.00
• Selling & Marketing: $5,264,300.00
• Total Expense: $34,519,900.00

Given the following admission, it is difficult to name specific cost drivers. Yet, the assumption is that they are primarily related to the build-out of Lido V3 and the cost of pursuing stETH issuers.

@lidolabs-operations

Generally, although forecasting accuracy has been difficult for the group, it also allows for some leniency during periods of market volatility and generally the Foundation is mandated to run a tight ship with prudent use of grant assets.

Questions

All in all, we will repeat the same primary question as Nansen:

1. Given the significant increase in budgeted resources in 2025, there must be cost drivers that are related to these projections – generally, what are they?

[Jenya_K]

@BlockworksResearch

Given the significant increase in budgeted resources in 2025, there must be cost drivers that are related to these projections – generally, what are they?

Appreciate the question! However, could you clarify what exactly is being compared?

If I sum up all grant proposals from 2023 and 2024, the major budget increase happened between 2023 and 2024. When looking at 2024 vs. 2025 , the total grant requests—including Multi-EGG from LCG, and the ongoing EGGs from both Lido Labs Foundation and Lido Ecosystem Foundation—have increased by around 10%, which is broadly in line with previous trends.
UPD: My mistake—I checked the documents Blockworks referenced below, and I agree. The grant request from the foundations has increased more significantly than I initially thought.

Primary budget allocations for 2025 (as outlined in the proposals): protocol maintenance, decentralization initiatives, Lido v3 development, research & development of other proposals aligned with GOOSE objectives.

For reference, a list of major grant requests from the past three years is here:

Consolidated Grant Requests (Past Three Years)

[LIDO-1] (November 1, 2022 – April 30, 2023) Proposal

[LIDO-v2] (May 1, 2023 – December 31, 2023) Proposal

[st2024 v1] Proposal

[st2024 v2] Proposal

[Multi-EGG 2025] Proposal

[governance-data-bot]

Snapshot vote started

We’re starting the [EGG] Lido Labs BORG Foundation Grant Funding Request (Apr-Dec 2025) Snapshot, active till Mon, 24 Mar 2025 16:00:00 GMT . Please don’t forget to cast your vote!

[adam-11]

Hello, this is my proposal, which is in line with the original intention of goose2. If you can, I hope to help initiate a vote or make suggestions, because I saw that the latest gooes2-related proposal application deleted this part of the content "Tokens are linked to protocol income

"Proposal: $LDO COIN Staking Rewards and Protocol Revenue Linking Mechanism

[BlockworksResearch]

Acknowledgement

Thank you for the feedback, @Jenya_K, and for holding us to a standard of proof!

Thank you to @steakhouse for their continued commitment to budget creation; without them, these numbers would be impossible to deduce.

For the contributors and community, allow us to address how we came to the former total budget numbers.

Introduction

We feel that this explanation corroborates our numbers and will allow the community to come to a conclusion on their accuracy. For a more detailed explanation of our findings, APPENDIX A in the Lido Governance Manual links to an Excel sheet titled “Budgets”.

Explanation For Budget Comparison

Here are all the budget periods ever proposed Q1 2022, Q3/Q4 2022, Q1 2023, Q2/Q3/Q4 2023, Q1/Q2 2024, Q3/Q4 2024, Q1 2025, Q2/Q3/Q4 2025. The budget periods are inconsistent which makes them incomparable – on a relative basis – when measuring total budgeted allocation. Our explanation below will only explain the totals, not the categorization for G&A, R&D, and S&M (for more information, head to linked APPENDIX A).

In order to compare the total budget allocation we must normalize for time-period. In our data, we normalized the data to be yearly. Notably, the data you see above does not account for the budgeted LOL spending because it is categorized as distinct from operating expenditures in Steakhouses Financials.

2022

Q2 2022 (Source 1)

Not accounting for contingency because that is an authorized but not allocated budget expense the Total OP EX is equal to $1,046,505.00 = 513,504 + 533,001 for Q2 2022

Q3&4 2022 (Source 1)

The Total OP EX is equal to $1,112,883 = 634,881 + 478,002 for Q3 2022 RCC

Q4 2022 (Source 2)

The Total OP EX is equal to $732,710 = 235,543 + 497,167 for Q4 2022 RCC

The Total OP EX is equal to $3,384,854 = 981,869 + 981,869 + 585,558 + 835,558 for Q4 2022 LIDO-1 Budget.

Q4 2022 Total Budget Allocation ex contingency is then $4,117,564 = 732,710 + 3,384,854

Total H2 Budgeted is then $5,230,447 = 732,710 + 3,384,854 + 1,112,883

Total 2022 budget is $6,276,952 = 732,710 + 3,384,854 + 1,112,883 + 1,046,505.00

2023

Q1 2023 (Source)

The Total OP EX is equal to $5,684,998 = 1,230,735 + 1,230,735 + 931,152 + 1,437,458 + 527,458 + 327,458 for Q1 2023

Q2/Q3/Q4 2023 (Source)

Total Op Ex is equal to $20,500,000 = 4,900,000 + 11,600,000 + 4,000,000 for Q2/Q3/Q4 2023

Total 2023 budget is $26,184,998 = 20,500,000.00 + 5,684,998

2024

H1 2024 (Source)

Total Op Ex is equal to $22,500,000 = $6,500,000 + $10,900,000 + $5,100,000 for H1 2024

H2 2024 (Source)

Total Op Ex is equal to $24,600,000 = 6,900,000 + 14,900,000 + 2,800,000 for H2 2024

Total 2024 budget is $47,100,000.00 = 24,600,000 + 22,500,000

2025

Q1 2025 (Source)

Total Op Ex is equal to $11,100,000.00 = 3,500,000 + 4,900,000 + 2,700,000 for Q1 2025

Q2/Q3/Q4 2025 (Source 1, 2)

Total Op Ex is equal to $45,490,000 = 3,680,000 + 1,000,000 + 5,930,000 + 13,280,000 + 21,600,000 for Q2/Q3/Q4 2025

Total 2025 budget is $56,590,000 = 11,100,000 + 45,490,000

[Jenya_K]

Huge thanks to @BlockworksResearch for their incredible work in increasing transparency! This is a massive effort, and your contributions are hugely valuable to the community.

I also want to highlight an important point— grant requests don’t reflect actual spending. Despite approved budgets, funds aren’t always fully utilized, and significant portions often remain in the treasury.

Key granted vs. spending insights:

• The 2024 grant was underspent by ~38%.
• Multi-EGG has similarly underspent.

For real-time financial insights, the best source of truth is the SAFU Dune dashboard. This dashboard, built by Steakhouse and Lido Analytics contributors, provides a look at financials, with key accounting principles and detailed breakdowns of expenses.
https://dune.com/steakhouse/lido-safu

While transparency has improved, clarity around budget utilization is still lacking. Seeing the new foundations aiming to improve reporting and financial transparency for the community.

[Tane]

We are supportive of this budget proposal and appreciate the clear alignment with the recent legal restructuring within Lido. It effectively highlights critical issues and themes that the Lido Labs BORG Foundation should appropriately address.

Moreover, we highly value the clear identification of not only thematic areas but also measurable KPIs, which will significantly enhance transparency and accountability.

We echo the suggestion made by @Nansen regarding periodic updates on progress. As noted by @lidolabs-operations, regular reporting—such as bi-annual or quarterly updates—on the strategic projects and shifts in KPIs would greatly contribute to constructive and efficient DAO governance.

@lidolabs-operations

Additionally, the foundation will aim to report progress towards key OKRs in a quarterly cadence.

Lastly, we have one question concerning the unused portions of the budget of 2024 or before.

For budgets not fully utilized, is it correct to understand that these funds were simply never drawn from the treasury, and thus require no special action, or is there a scenario in which returns from the previous core contributors (the 3 entities) might be necessary?

[Jenya_K]

@Tane

is it correct to understand that these funds were simply never drawn from the treasury

That’s correct. Lido contributors take a highly conservative approach to grant funding operations. Funds are only requested based on actual expenses.
As a result, any underspent budget has never left the treasury.

[Alex_L]

Snapshot vote ended

Thank you all who participated in [EGG] Lido Labs BORG Foundation Grant Funding Request (Apr-Dec 2025) Snapshot, we reached a quorum!
The results are:
Adopt multisig policy: 62.8M LDO
No changes: 17.9k LDO