Ethereum staking solution Lido Finance has raised $70 million from venture capital giant Andreessen Horowitz, marking the protocol’s first funding round since May 2021.

Andreessen Horowitz’s investment in Lido is intended to further support the adoption of decentralized staking solutions for Ethereum 2.0, a spokesperson for the venture capital firm said. Ethereum 2.0 marks a significant shift in the network’s consensus algorithm by ushering in the adoption of proof-of-stake (PoS) and other upgrades that could enhance scalability and reduce fees. The transition to Ethereum 2.0, which began in November 2020, is still ongoing.

Excited to share that @a16z has invested $70M in @LidoFinance, one of the easiest ways to stake ETH and other PoS assets, and we used Lido to stake a portion of our ETH holdings on the Beacon chain. More from @DarenMatsuoka & @_PorterSmith: https://t.co/vc2tzDJ3mS

— cdixon.eth (@cdixon) March 3, 2022

According to Andreessen, staking Ether (ETH) has significant barriers due to the high threshold for operating a node. To become a full validator, users must be able to stake at least 32 ETH, which is worth over $90,000 at current prices.

In addition to investing in Lido, Andreessen said it’s staking a portion of its ETH holdings on the Beacon Chain through the protocol. “Staking with Lido removes many of the operational complexities that institutional investors have faced,” the venture firm said.

Ethereum’s Beacon Chain recently registered its 300,000th validator, according to industry data. At the time of writing, nearly 9.7 million ETH had been staked for a total value of over $27.1 billion.

Although terms like Ethereum 2.0 and Eth2 are still widely used in the industry, the Ethereum Foundation announced in January it would ditch such terminology. Instead, it now refers to the original Ethereum blockchain as the “execution layer” and the PoS chain as the “consensus layer.”

Founded in 2020, Lido Finance offers a liquid staking solution for Ethereum 2.0, allowing users to stake their ETH with no lockups or minimum deposits. As Cointelegraph reported, Lido also supports other tokens, having only recently added Kusama liquid staking.

More staking options arrive as we get closer to Ethereum 2.0. @Ledger has announced a partnership with @LidoFinance in a move that could make $ETH staking more accessible. https://t.co/SgGZTWyRhF

— Cointelegraph (@Cointelegraph) August 16, 2021

Related:Ethereum hash rate scores new ATH as PoS migration underway

Lido concluded a $73 million funding round in May 2021 that was led by crypto venture capital firm Paradigm. Three Arrows Capital, Alameda Research, Digital Currency Group and Alameda Research also contributed.

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