The LDO token is the governance token for Lido DAO. It is used to vote on protocol parameters and govern the Lido DAO treasury.
With the mission to make staking simple, liquid, secure and decentralized for the end user, the Lido DAO has the following responsibilities:
Deploy protocol smart contracts;
Set fees and other protocol parameters;
Select the threshold signature scheme participants among reputable individuals or organizations willing to provide the service;
Facilitate the multi-party computation ceremony to create the threshold signature account for staking rewards;
Assign initial DAO-vetted node operators.
Propose and update Lido’s parameters;
Approve incentives for parties that contribute towards DAO’s goals (e.g., stETH liquidity providers);
Propose and update Lido’s implementation for incoming Ethereum 2.0 features using DAO treasury funds;
Assign oracles to deliver reward/slashing rate feed to help establish stETH token balances;
Scout and qualify new node operators and penalize the existing ones slashed by Ethereum 2.0’s rules;
Manage the Lido DAO’s insurance and development funds;
Manage unbonding and withdrawals once available in Ethereum 2.0;
You can learn more here: blog.lido.fi/introducing-ldo/