Lido Validator Upgrade Could Cut Ethereum Validator Count by Over a Third

Lido, one of Ethereum's largest liquid staking platforms, has rolled out an upgrade to its validator system. The Curated Module v2 is designed to improve validator efficiency by enabling them to operate with larger effective balances.

The upgrade adds support for Ethereum's 0x02 withdrawal credentials, which will allow validators to increase their effective balance from 32 ETH to up to 2,048 ETH depending on configuration. This change could reduce the number of validators from around 880,000 to approximately 628,000, a drop of about one-third.

Lido's update emphasizes that this change will primarily affect the consensus layer, rather than execution-layer activity such as transaction fees. The migration is expected to be handled at the protocol level, requiring no staker action.