Ethereum restaking protocol EigenLayer TVL surges amid rising ETH staking

EigenLayer, an Ethereum-based restaking protocol, has surged previous Uniswap, the foremost decentralized change (DEX) on the Ethereum community, concerning complete locked worth (TVL).

Data from DeFillama exhibits that EigenLayer has emerged because the top-performing decentralized finance (DeFi) protocol over the previous month. Its TVL skyrocketed by 171% within the final seven days alone, reaching $5.67 billion, positioning it because the fifth-largest DeFi protocol.

EigenLayer TVL
EigenLayer TVL. (Supply: DeFillama)

In distinction, Uniswap noticed a modest 6% enhance in TVL, reaching $4.31 billion throughout the identical interval. Different outstanding DeFi protocols, comparable to Lido, Aave, and Maker, additionally skilled comparatively modest development charges of lower than 10%.

In the meantime, EigenLayer’s speedy enhance follows staked ETH development to an all-time excessive of greater than 29 million tokens regardless of the latest selloff by the defunct crypto lender Celsius, in line with Nansen information shared with Crypto.

Why is EigenLayer TVL surging?

EigenLayer’s surge will be attributed to the reopening of its vault for deposits on Feb. 5.

Since then, ETH holdings on the platform have skyrocketed from 941,000 to 2.3 million inside every week, marking a big enhance. This inflow represents roughly 2% of Ethereum’s complete circulating provide now staked by way of this platform.

EigenLayer Token Balances as of Feb. 8 (Supply: Nansen)

Blockchain analytics agency SpotOnChain reported that the highest 4 restakers on EigenLayer are Puffer Finance, Tron’s community founder Justin Solar, Eigenpie, and Kelp DAO. Puffer Finance leads the group with 233,600 ETH restaked, adopted by Solar with round 109,300 ETH — Eigenpie and Kelp DAO path carefully, having restaked 88,600 ETH and 75,300 ETH, respectively.

What’s EigenLayer?

EigenLayer dominates the restaking market, attracting vital consideration from the crypto group. Since June 2023, this DeFi protocol has regularly elevated its deposit restrict by way of a phased launch technique.

ETH restaking has emerged as one of many main narratives within the crypto market because it permits buyers to earn further rewards on their staked ETH. The protocol helps in style liquid staking tokens comparable to lido-staked ETH (stETH) and rocket pool ETH (RETH) restaking by way of its platform.

Murathan, a contributor to DeFi collective, identified the growing recognition of native restaking amongst ETH validators. He said:

“1 in each 4 validators coming into the Ethereum validator queue are setting their withdrawal credentials to an EigenPod.”

Nonetheless, some group members have warned that the mannequin would possibly create a Ponzi scheme that might come crashing quickly.

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