Tokensight Research
We are delighted to announce our strategic partnership with Ebisu Finance!
Through this collaboration, we will assist Ebisu in underwriting LRT risk by conducting infrastructure risk assessments on portfolio-selected Actively Validated Services (AVS) on EigenLayer.
Ebisu Finance unleashes the potential of EigenFi through two main products:
Ebisu Money by allowing users to draw dollar-denominated credit against LRTs and LRT derivatives via a decentralized stablecoin (ebUSD), providing liquidity against restaked assets while enabling yield generation through AVS and ETH staking rewards.
Ebisu Earn, a composable restaking strategy vault standard that helps users navigate emerging restaking platforms. Users earn staking, restaking, derivative/LP strategy yield, and points from underlying protocols while hedging individual LRT risk. In addition, ebUSD can be minted against these vault positions.
As Liquid Restaking Protocols (LRPs) begin composing their AVS portfolio strategies, EigenFi protocols must consider more than just economic metrics like liquidity and governance of liquid restaking tokens.
Unlike common Liquid Staking Protocols, LRPs include a novel infrastructure risk component derived from the services built on EigenLayer, crucial for LRT yield generation and their underlying security.
Assessing the soundness and solvency of these assets from first principles has become crucial, as a result.
Our partnership ensures that Ebisu Finance is adequately informed and considers LRT collateral health while securely scaling its marketplace.
Through our mathematical, research-driven frameworks, we will assist Ebisu in shaping each LRT AVS strategy profile from an endogenous infrastructure risk standpoint. We will recommend protocol parameters such as adequate deposit caps and minimum asset collateralization ratios that Ebisu should consider setting in their protocol, and avoid black-swan repercussions such as asset liquidations and risky lending practices.
Tokensight's basic three step process will be:
Underwriting AVS risk individually and in isolation (sample, illustrative dashboard: https://eigenavsrisk.streamlit.app/);
Underwriting AVS risk as a pooled service in the context of an AVS ecosystem on EigenLayer, taking in consideration thoughtful parameters that might mitigate/exacerbate its risk within that context;
Composing the aggregate, pooled risk of a given AVS selected-portfolio by an LRP and derive its health as a collateral asset in the context of Ebisu.
We are committed to providing ongoing risk underwriting intelligence for Ebisu Finance, including future quantitative modeling and cryptoeconomic security simulations.
In the coming weeks, we will share some findings from our research and joint collaboration. Stay tuned for more updates!
Visit the official Ebisu Finance website to dive deeper and stay updated on their latest developments!
Learn more on their ethos and the EigenFi space on the insightful blog posts: Introducing Ebisu & ebUSD and Underwriting LRTs: Balancing High Yields with Security.
Also learn more on EigenLayer by checking their website.
