Original title: Welcome to Restaking Summer

Original author: Jack Inabinet, Bankless

Original compilation: Luccy, BlockBeats

Editors note: On January 25, according to information from EigenLayers official website, EigenLayer TVL reached 806,700 ETH, worth approximately US$1.788 billion. Additionally, the team is introducing a new method of allocating re-pledge points that will cap the number of re-pledge points allocated to any LST, LRT or personal deposit at 33% of the total future issuance.

Bankless analyst Jack Inabinet deeply discussed the concept behind EigenLayer, introduced its points mechanism in detail, and analyzed its potential airdrop value. BlockBeats compiles the original text as follows:

There are only a handful of crypto projects that have generated at least a billion dollars in wealth for early users when airdrops first began, but we may very well be about to see another popular protocol join that list.

The promise of restaking becomes a transformative cryptoeconomic primitive, and EigenLayer is at the forefront of working to make it a reality.

Today we’ll explore why EigenLayer is a game-changer, give examples of the types of services built on top of it, give you a rationale for why EigenLayer is the next billion dollar airdrop opportunity, and estimate participation How big of an airdrop can we expect after EigenLayer?

Why is EigenLayer a game-changer?

EigenLayer creates a decentralized marketplace that allows Ethereum holders to “re-stake” their tokens, providing security for other cryptographic applications beyond just the Ethereum network.

As a programmable trust network, EigenLayer allows developers to create decentralized networks while avoiding the difficulties associated with launching and operating their own trust network.

Since protocol developers no longer have to worry about running a network of validator nodes, they can focus more on important matters, like building their applications, rather than working too hard to support the market cap of the stakeable tokens that secure their decentralized network.

This lowers the barrier to entry for creating your own decentralized network and gives more power to the long tail of cryptographic security applications.

Protocols using EigenLayer are renting their economic security from existing Ethereum stakers. This repurposing of staked Ethereum to provide security for multiple applications brings capital efficiency to staking. , effectively reducing the cost of protecting additional networks while maintaining strong trust guarantees for individual services.

For EigenLayer restakers, the protocol offers two opportunities to enhance their returns. Not only do re-stakeholders receive enhanced benefits from securing other networks, but they are also eligible to receive airdrops from protocols using their services.

What services can be built on EigenLayer?

EigenLayer Active Verification Service (AVS) refers to any system that requires its own distributed network of verification nodes for verification and relies on EigenLayer to provide security. The term AVS is actually a true umbrella term that can be applied to any decentralized verification application within the broad scope that the protocol can serve.

Re-stakers delegate their stakes to AVS operators, who operate EigenLayer’s infrastructure and use the re-stakers’ Ethereum as collateral for their services, in exchange for the ability to use these staked Ethereum as collateral.

The most famous AVS is EigenDA, EigenLayers data availability solution.

Although EigenDA is not currently live, it is expected to significantly reduce the cost of publishing data on rollups and is expected to provide a more cost-effective solution than the leading DA solution Celestia, thanks to the re-staking relative to the Celestia model Cost-effectiveness of operating an independent L1 blockchain.

However, EigenLayers ability to protect the network goes far beyond the Ethereum ecosystem, and a variety of applications are being built on the Cosmos ecosystem.

Cosmos Hub (ATOM) has long been the primary cross-chain security provider for networks that don’t want to launch their own tokens and validator node sets in the Cosmos ecosystem, but EigenLayer is looking to take that crown soon.

Ethereum os and Layer 3r are two AVS that will enable the Cosmos chain to launch its L1 using EigenLayers existing trust network, providing a more attractive (and cost-effective) security alternative to the Cosmos Hub.

Just as EigenLayers AVS can be used to provide security for L1 and L2 blockchains, they can also verify a variety of other cryptographic systems, including decentralized guardian and oracle networks.

EigenLayer also aims to increase interoperability: their fast finality AVS will allow any transaction to reap the benefits of instant settlement, and bridge protocols can leverage AVS to use EigenLayers re-pledged Ethereum network as collateral, prompting settlement on user transactions. Reduce waiting time during transfer.

Although the intersection of artificial intelligence and cryptography is only beginning to be explored, EigenLayer could become an important player in unifying the two environments. Onchain AI interfaces may soon be able to leverage AVS to verify the integrity of their algorithms by generating zero-knowledge proofs, while the capital efficiency of EigenLayer’s re-staking model makes it more cost-effective than alternative ZKML technology.

How big will EigenLayer’s airdrop be?

Accurately valuing crypto protocols with actual cash flows is difficult enough, let alone one that doesn’t yet exist. While theres no direct comparable to EigenLayer, Celestia offers a close enough competitor to base its valuation on.

Celestias sole purpose may be as a data availability layer, but the networks TIA token currently has a fully diluted valuation (FDV) of $15 billion, just below last weeks brief peak of $20 billion.

EigenLayers advantage over Celestia is the variety of additional services it offers, and there are multiple revenue drivers beyond data availability, meaning the market may view EigenLayer as a more attractive investment opportunity than Celestia.

Unfortunately, EigenLayers valuation is affected by the fact that it is not a blockchain network, which means that the EIGEN token cannot accumulate the L1 premium as expected.

In practical terms, this means that EIGEN will have less utility than TIA because it will not be an asset for staking AVS, a factor that will reduce demand for the token, potentially causing EigenLayer to trade at a lower valuation.

EigenLayer may choose to enhance the utility of EIGEN by using EIGEN as a payment token for services provided by the network. However, this is a less efficient source of demand and will be partially offset by inevitable selling pressure from rehypothecaters and AVS operators who use it as compensation looking to cash out and exchange for another asset.

Taking all of these factors into account, it seems reasonable to assume that EigenLayer will trade at an FDV similar to Celestia, possibly with a valuation of around $10 billion to $20 billion at initial launch.

While EigenLayer’s token economics are currently unknown, it doesn’t seem outlandish to further assume that they will airdrop 10% of their token supply to early users, which would easily make the protocol a multi-billion dollar airdrop.

What does this mean for individual depositors?

Currently, 760,000 Ethereum have been deposited in EigenLayer, and the upcoming LST cap increase will further increase the number of Ethereum. Depositors receive one point per Ethereum stake per hour, and the total points accumulation is approximately 1 billion.

We have no way of knowing how many EigenLayer points there will be, as its unclear when the airdrop will take place and how much Ethereum will earn points at that point, but we do know that Polymarket currently rates the probability of the EigenLayer airdrop arriving before April as only There are 13%.

Assuming that the EIGEN airdrop will take at least another 180 days from the next time the deposit limit is raised, and that during this period the management volume of Ethereum increases linearly to 1 million, then approximately 4.8 billion points will exist at the time of the airdrop.

At a valuation range of $10 billion to $20 billion, assuming 10% of the total EIGEN supply is airdropped, depositors can expect to receive $0.21 to $0.41 per point, representing every time EigenLayer raises its Claim opportunities for Ethereum deposited during the LST cap range from $907 to $1,814.

It is worth noting that while many assumptions must be met for this estimate to be valid, this is only the minimum allocation that non-whale depositors can expect to receive; tiering the allocation of EIGEN tokens and capping the maximum allocation will benefit small depositors .

How to maximize EigenLayer airdrop opportunities?

The first thing you need to do to qualify for EigenLayers short investment is to set a reminder on your calendar to deposit Ethereum on February 5th.

Original link