Cork — the tokenized risk protocol — is live in public beta on the Ethereum mainnet. Lido is one of Cork’s key launch partners, introducing the wETH:wstETH risk market. The market lets users hedge, trade, and earn against the risk that wstETH loses its price correlation to wETH.

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Start with wETH:wstETH on Cork.

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About Cork

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Cork introduces a novel primitive to DeFi known as Depeg Swaps, which represent the risk associated with any pegged asset — including stablecoins like USDC and liquid staking tokens like stETH — that it loses its pegged value. Cork’s Depeg Swaps represent tokenized risk, which can be traded against to protect positions or capture upside on depeg events. Cork was built to bring more opportunity to existing crypto markets, while also providing more financial instruments in preparation for the influx of real-world assets and institutional capital into crypto.

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Lido x Cork

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Lido is the leading ETH liquid staking protocol, launched in late 2020 to strengthen and accelerate the launch of Ethereum’s Beacon Chain. For over four years, Lido has given ETH holders — from whales to retail holders — the opportunity not only to earn on their ETH, but also to use the stETH liquid staking token elsewhere in DeFi. With more than $20B of TVL (DefiLlama, February 2025), Lido is the largest liquid staking protocol today.

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stETH’s value is correlated to ETH’s price and is proportional to ETH’s market value and the yield generated from staking ETH. Lido’s trust, adoption, and value is dependent on the capacity for stETH to be convertible back to ETH. However, depeg events (both big and small) have been inevitable in crypto’s past for every single kind of pegged asset.

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Lido’s partnership with Cork to launch the wETH:wstETH risk market is an evolution in the stability and opportunity of the stETH ecosystem. The market will allow people to protect their stETH positions against a potential depeg risk (hedge), trade on the chance that stETH does lose its peg and earn by providing liquidity to the wETH:wstETH vault. This market dynamic gives a price to the risk that 1 stETH is not instantly convertible to 1 ETH.

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The result? More insight into the health of the wETH:wstETH market. The ability for people to protect their valuable stETH positions against a risk that is inherent to crypto. More financial instruments associated with stETH. And, overall, a stETH ecosystem defined by more stability, more opportunity, and more transparency.

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Starting with Cork x Lido

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The Lido wETH:wstETH market on Cork gives users opportunities to protect their portfolios and earn based on the risk that stETH loses its peg to ETH. There are three main ways for users to get involved with the wETH:wstETH risk market on Cork.

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1. Hedge: Users who want to protect their stETH holdings against the risk of a depeg event can buy stETH Depeg Swaps. To do so, users can purchase tokens directly from the Cork app, or purchase Depeg Swaps from a DEX. In the event of a depeg, stETH Depeg Swaps can be deposited back into Cork’s Peg Stability Module to redeem ETH on a 1:1 (i.e. pegged) ratio.
2. Trade: Users who want to trade the likelihood that stETH loses its 1:1 convertability to ETH can buy stETH Depeg Swaps or Cover Tokens that behave similarly to prediction markets. To do so, users can purchase tokens directly from the Cork app, or purchase these assets from a DEX. In the event of a depeg, stETH Cover Token holders will be distributed all remaining assets in the wETH:wstETH Peg Stability Module.
3. Earn: Users who want to earn can provide liquidity to the wETH:wstETH vault. Providing liquidity to the vaults earns yield through trading fees, risk premiums, and protocol fees.

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For a deeper understanding of how to start with Cork, see the Cork documentation. To dive right in and get started with Cork x Lido, head to the Cork application.

Want to partner with us to open a new Cork market pair? Connect with us here.