# EigenLayer - the most ambitious Re-staking protocol in 2023

**Published by:** [NNT](https://paragraph.com/@nnt/)
**Published on:** 2023-08-22
**URL:** https://paragraph.com/@nnt/eigenlayer-the-most-ambitious-re-staking-protocol-in-2023

## Content

What is EigenLayer? How it is affected in long term? Let’s explore! 1/ Overview EigenLayer is a re-staking protocol that lets users re-stake their ETH for extra yield and utilizes Ethereum's security to support middleware, blockchain, and new protocols at a reduced cost. The entire EigenLayer protocol can be divided into: • Demand side: middleware, data availability layers (DA), oracles protocol, bridge protocol... • Supply side: Individual ETH stakers in staking service provider (Lido, Rocketpool...) 2/ Team Team size: 35 members, with over 80% being engineers. Young but experienced research in blockchain technology, making EigenLayer team a promising and noteworthy group. Historically, projects led by such technical teams have often achieved great success. 3/ Financial EigenLayer has garnered substantial early-stage support from the capital market, securing over $64.4M across 3 funding rounds. With 8 high-profile backers, 4 of them are top VC tier-1. 4/ SWOT analysis 📌Project Strengths: • Trinity benefits: achieved through 3 sources (pledging Ethereum earnings, cooperative project node construction, verified token rewards). • Increasing market efficiency: + Unlock liquidity for LSD & LP tokens. + Save internal bootstrapping & maintenance costs for new protocol • Enhance network security: Increase the security of the network using liquidity staking. • Lower the threshold for project parties: project can reduce costs, and thresholds, and improve core functionality & user experience by using Ethereum trust Layer provided by EigenLayer. 📌 Project Weakness • Risk of asset loss: If a node or network is attacked, forked, or misbehaved, the restaker's assets may be forfeited in partial or total permanent loss. • Trust leverage risk caused by restaking. • Asset bubble risk. • Cancellation period risk: If the restaked ETH needs to wait a certain period of time to unlock when unstaked, then users may be exposed to liquidity and price fluctuations. • Value capture risk: If the security and incentives provided by EigenLayer are not sufficient to attract protocols and validators -> loss of sovereignty over the protocol, reduced value of collaborative projects, or slow ecosystem development. 📌Project Opportunities • First mover advantage: Re-staking is a new concept that has no direct competitors, if EigenLayer is successful it will become the leader. • Market share: EigenLayer is promising to place a top TVL project in the LSD industry with a TVL of about $200B. 📌 Project Threats • Tokenomics issues: If users can earn by restaking ETH without using native tokens from other protocols, EigenLayer's native tokens may lose value and demand. • Reward distribution: unfair token distribution and reduced user participation. • Security event risk: A large number of ETH is being confiscated, affecting the security of the Ethereum network. • Technical risks: result in the loss of assets or trust of the staker and module, affecting the reputation and development of the project. 5/ Current Metrics • TVL: $73M, ranked at top 13 in Liquid Staking TVL rakings. • 12.9K unique addresses deposited into EigenLayer. • Collected 161+ $ETH gas fee. We’re in the early stage of re-staking and how it affects the long-term balance of the industry. We hope that you find that thread helpful ❤️

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