Lido Finance, Ethereum’s largest liquid Stack platform of Locked Value, has introduced a proposal that gives the stack ether (Steth) holders direct voting power together with existing DAO token holders.

The upgrade, called Lido Improvement Propposal (LIP) 28, outlines a double control system that allows Stethe holders – those who sting ETH via Lido and receive a liquid token in return – to participate in a vetomechanism on key protocol decisions. Currently only holders of LDO$1.07Lido’s Governance Token has something to say about how the protocol develops.

According to the new system, Stethe could veto certain proposals approved by LDO token holders, although the veto would not allow them to push suggestions through unilaterally.

The proposed system is framed as a mechanism to increase responsibility and decentralization, especially as Lido continues to dominate Ethereum’s intervention landscape. Over 25% of all ETH is stacked on the network that runs through its infrastructure.

How it works

The double management system adds a special time -lock contract between Lido Dao’s decisions and their execution, giving Steth holders a way of intervening if they are strongly against a proposal.

The “dynamic” time lock is needed because this is how technically controlling technically works behind the scenes.

In the current system, decisions do not take effect immediately as there is a fixed period before they are performed. It gives users time to respond if they do not agree with certain changes.

However, Ethereum stacking is different because you can’t quickly remove or pull ETH, even with the current time slock. It takes time, liquidity is complex and there is often a queue that can take several days to clear.

The new proposal wants to tackle it.

The proposed dynamic Timelock assumes that as enough users who are not satisfied with a proposed change, depositing their steth (or wrapped steth and withdrawal of NFTs) in a designated Escrow contract for withdrawal, the time lasting is beginning to rise -this is called to cross “first seal” (set to 1% of the total Lido eth.

If dissatisfaction continues and deposits crosses the threshold “Other Seals” (10% of Lidos ETH Tvl), a “rage that has been completed” is triggered “: The performance of DAO’s decision is completely blocked until all protesters have had the chance to withdraw their ETH.

This creates a kind of safety valve – which allows stakes to signal objection and exit – while still giving DAO time to respond or cancel the disputed action.

The plan is coming as Ethereum has risen more than 30% over the past week and riding of momentum from its pectra upgrade, introducing the reform of execution layer to improve scalability and efficiency.

The rally has given rise to renewed attention to Ethereum-native applications such as Lido, which are critical of the capital flow and the validator’s participation across the chain-and directly affects the ETH market structure.

The LIP-28 proposal is still in its discussion phase, with a formal vote on the chain expected in the coming weeks.

If it is approved, the change could move how governance is distributed over Ethereum’s action ecosystem, setting a precedent for other defi-protocols seeking to include users, not just token holders, in the decision-making process. Lidos other competitors include Rocket Pool and Frax Ether.

The LDO prices have risen 6.5% over the last 24 hours, while the Coindesk 20 index, a wider market meter, increased 2.5%.

Read more: Ethereum activates ‘Pectra’ upgrade, raises Max Stake to 2,048 ETH