Lido proposes deploying up to 10,000 stETH from the DAO treasury to buy LDO

Two of DeFi’s established governance tokens are now in the red zone, forcing their respective DAOs to move capital in an effort to change that. 

Today, March 27, Lido’s Growth Committee proposed a direct LDO accumulation strategy using treasury stETH.

At the same time, 1Inch DAO announced the launch of a new structured incubator to fund teams building revenue-generating strategies for its Aqua protocol.

1Inch bets on Aqua to open a new revenue pipeline

The 1inch DAO’s Aqua Revenue Stream Incubator is accepting applications until April 8 and offers up to $400,000 for external teams to build revenue-generating strategies on Aqua, the protocol’s latest shared liquidity platform. 

Each team gets a grant of up to $50,000, but unlike typical ecosystem grants, the participating teams are expected to share a portion of the revenue they generate with the DAO treasury.

Once selected, funding is unlocked after hitting certain milestones, tying the DAO’s capital directly to outcomes, which is particularly important considering 1inch’s history with grant programs. 

Some delegates at the DAO have previously stated that its former grant programs were somewhat unsuccessful due to the lack of reporting and accountability from recipients. One delegate even went as far as saying that the DAO has “effectively become a front for portraying a sense of decentralisation.”

Aqua is 1inch’s shared liquidity platform, which launched developer access in November 2025 with a public frontend initially expected to launch this quarter. 

The 1INCH token is currently trading at around $0.28, with a market cap of approximately $245.5 million. Its all-time high of $7.87 came as far back as May 2021, putting the current price about 96% below that level. 

The token’s all-time low of $0.08 came more recently in October 2025, and the incubator is its latest attempt to rebuild to past peaks.

Lido shopping with its own treasury?

Lido’s move is a bit more direct. The project published a proposal today on its Lido Research portal that will authorize the Growth Committee to use up to 10,000 stETH from the Lido DAO Treasury, which will operate separately from the automated NEST format that Lido is also developing as the long-term solution to its revenue issues.

The conversion will be executed through different on-chain exchanges, including CoW swap, 1inch, and Uniswap, as well as off-chain exchanges like Binance, Bybit, and OKX. 

Funds would then be deployed in 1,000 stETH batches, each requiring a published execution price cap before an Easy Track motion is initiated. 

According to the proposal, net protocol rewards are down approximately 20% over the same period in which the LDO:ETH ratio fell by almost 50%. 

Essentially, LDO is undervalued because its price dropped much further (50%) than its actual revenue (20%). 

Despite a tough market, the protocol actually became more efficient by cutting costs and increasing its fee percentage. As the dominant leader in liquid staking, the DAO believes the market has overreacted, creating a perfect opportunity for the treasury to buy back its own assets.

But what do these moves mean?

DAOs spending treasury capital to support their own tokens is not new, but it does not come without controversy. 

Some argue it is a sign of desperation, and a use of community funds to boost prices rather than build a product. Others argue it is rational capital allocation derived from the same logic that drives public company share buybacks when management believes the stock is mispriced.

What makes the Lido and 1inch moves notable is that both protocols can make a credible case. Lido commands $18.98 billion in TVL with a market cap of over $244.5 million, and a market cap to TVL ratio of 0.0128, which is one of the most compressed in DeFi. 

1inch, despite its token price collapse, remains a top-tier DEX aggregation layer processing a large daily volume across Ethereum and multiple other chains. 

Right now, neither DAO is deploying treasury capital out of strength, but they both have a strong argument that their current prices do not reflect what the protocols actually are.

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