EigenLayer, a extremely anticipated “restaking” protocol for Ethereum, efficiently accomplished the preliminary guarded stage of its mainnet launch on Wednesday.
Customers can now deposit liquid staking tokens (LSTs) into the protocol, or arrange and configure an EigenPod to natively restake ETH. The protocol helps Lido’s stETH, Rocket Pool’s rETH, and Coinbase’s cbETH tokens, with plans to onboard different LSTs sooner or later.
As soon as its rollout is full, EigenLayer will permit Ethereum stakers to validate third-party providers for a yield whereas concurrently incomes staking rewards for securing the community.
“EigenLayer goals to empower the ecosystem stakeholders and innovate on each the way forward for shared safety, in addition to the way forward for decentralization,” the challenge mentioned in a blog post.
EigenLayer’s liquid staking swimming pools are at present capped at 3,200 tokens every, with particular person deposits restricted to 32 tokens per transaction. The creation of latest EigenPods will pause as soon as native staking exceeds 9,600 ETH. Withdrawal requests will execute after a seven-day delay.
$32B Market
EigenLayer is searching for to harness Ethereum’s staking ecosystem as a shared safety layer, however its success might hinge on its means to compete with DeFi protocols as a supply of additional yield for stakers.
Common LSTs like stETH and rETH take pleasure in integrations with a variety of DeFi protocols, providing holders a wide range of methods for producing yield or accessing liquidity whereas persevering with to build up staking rewards.
Though Ethereum’s staked capitalization is already $32.5B, solely 16% of circulating Ether is staked, suggesting the sector should still have important room to develop.
Restaking
The Ethereum community validates code written in its native Solidity programming language that’s suitable with the Ethereum Digital Machine (EVM), Ethereum’s core good contract engine.
EigenLayer permits stakers to additionally opt-in to validate modules containing non-EVM code, additionally known as “Actively Validated Providers (AVSs),” by harnessing Ethereum’s staking ecosystem as a shared safety layer.
EigenLayer mentioned the second part of its launch would introduce “Operators,” which carry out validation duties for AVSs constructed on the EigenLayer protocol. AVSs will come on-line later, finishing EigenLayer’s mainnet launch.
“Restakers have the pliability to delegate their staked ETH to Operators or run validation providers themselves, successfully turning into an Operator,” EigenLayer mentioned. “Restakers retain company over their stake and select which AVSs they opt-in to validate for.”
Operators and restakers face further penalties if an AVS they safe misbehaves or in the event that they fail to carry out validation duties, on prime of the common slashing dangers related to staking.
Vitalik Buterin not too long ago warned in opposition to protocols searching for to leverage Ethereum’s social consensus mechanism for functions apart from securing the Ethereum community.
“We needs to be cautious of application-layer initiatives taking actions that threat growing the ‘scope’ of blockchain consensus to something apart from verifying the core Ethereum protocol guidelines,” Buterin said in a weblog submit final month.
Sreeram Kannan, EigenLayer’s founder, described Vitalik’s critique as an “glorious evaluation,” advocating for restakers to make use of the protocol for “low-risk” actions.
Governance
The protocol’s contracts are upgradeable and pausable. Three multisig governance wallets oversee contract upgrades, pause performance, and protocol parameter changes respectively.
EigenLayer described the setup as a brief governance answer and mentioned it intends to decentralize sooner or later. Its multisig signers embody Tim Beiko from the Ethereum Basis, Swapnil Raj from Nethermind, and Ben Rodriguez from Coinbase Cloud.
“These multisigs signify a rudimentary however working system of clear preliminary governance, with acceptable checks and balances,” EigenLayer mentioned.
ConsenSys and Sigma Prime audited EigenLayer’s code. The challenge can be providing $2M in bug bounties by way of Immunefi.