$EIGEN Spotlight

All right, we have here the Eigenlayer. I'm going to write this out as if I'm explaining this to my mom.

PoS and LSD 💧

Let's start with ETH a PoS chain; a Proof of Stake network securing itself by staking its own coin into a yield accruing mechanism calculating ETH emissions and usage from the protocol. It's a pretty straightforward concept. We add onto it LSDs or Liquid Staking Derivatives which allows for those staked assets to be wrapped and used while still accruing yield. Examples such as stETH, rETH allow users to use their underlying ETH in DeFi and onchain activities while securing the network.

Restaking ♻️

Eigenlayer proposes to recycle those tokens via a technique called restaking. The proposal is to use the security of ETH and its derivatives for further dAPP development specifically through AVS's; Actively validated services. Such use cases are currently Bridges, Oracles, and SaaS or any other project with the trust-minimized, decentralized, crypto ethos. One issue with AVSs is that they have to create tokens to decentralize their protocol, making the overhead costly, especially for newcomers and edge products. Projects often require liquidity mining for their protocol to function properly. Eigenlayer's restaking creates a new marketplace for AVSs to deploy their product by leveraging the restaked ETH. This idea is essentially shared security and it’s not new. ATOM does it with their 'consumer chains', and DOT explores this with their 'parachains', Eigenlayer deployed a DA AVS as its first use case, and currently over 50 AVSs are in production. The $EIGEN token can be staked and rewarded to the stakers although this is thankfully not a requirement for all AVSs, they can reward restakers with a token of their choice. $EIGEN is also be used for governance.

Sideshift in to $EIGEN 🎈

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