Introduction

Restaking is a ~$20B industry growing ~15x year-to-date and capturing ~15% of the ETH market. For now, the restaking industry is 100% bootstrapped by risk-free yield (points). In order for EigenLayer to cross the chasm and cement itself as a fundamental crypto primitive it must eventually facilitate scalable economic activity. There are two ways to achieve this

1. AVS Yield - secure other cryptoeconomic systems in exchange for slashing risk. Yield source: AVS security budget.

2. Derivatives Yield - earn the funding rate or sell volatility in exchange for financial risk. Read more. Yield Source: funding rate / options premiums.

While the EigenLayer team is busy with solution #1, 3Jane is executing on solution #2.

3Jane: Derivatives Yield

3Jane is a crypto-native derivatives protocol built on restaking. 3Jane unlocks a novel derivatives yield layer by enabling the collateralization of all exotic yield-bearing ETH variants in *options contracts*. As a result, restakers can earn +10-15% APY in ETH yield on top of staking/restaking yield.

First Derivatives Execution

3Jane just executed its first options sale, selling ~$2.6M in ETH call options to our institutional market makers in exchange for yield. 3Jane depositors earned ~8% APY in real eETH options yield on top of staking + restaking yield!

Size: 666 eETH call option contracts
Instrument: weETH-14JUN24-4450C
Premiums Earned: ~0.98 eETH
Yield: 0.0147% (~8% APY)
Transaction

3Jane is the first ETH yield source for all EigenLayer assets and the first step towards financializing EigenLayer by sourcing yield not just from AVS security but also from financial derivatives.

Deposit today to earn $ETH on your restaked assets: 3jane.xyz

3Jane will *not* be offered to persons or entities who are U.S. Persons, Restricted Persons, or Sanctioned Persons. Access and use by such persons is expressly prohibited.

3Jane is a crypto-native derivatives protocol built on EigenLayer. 3Jane enables the collateralization of any EigenLayer restaked asset in derivatives contracts (inspiration). 3Jane unlocks a novel derivatives yield layer for the EigenLayer ecosystem, allowing native restakers, liquid restakers, and LRT holders to earn derivatives yield in addition to staking and restaking yield. 3Jane represents a broader necessary evolutionary step for EigenLayer toward financialization.

Financialization of EigenLayer

EigenLayer v1 is about building out the trust network boilerplate infra to support generalizable validation of any software module. As such, the past six months were defined by a golden age of building out other AVS infra (i.e. chains, DA’s, bridges, oracles) that then borrows EigenLayer security to enforce validation. However, as of now restaked assets are entirely unproductive assets that earn 0% APY from said PoS systems. Enter Derivatives Yield.

Derivatives Yield: The New ETH “Farm”

3Jane allows users to generate enhanced yield, without any opportunity cost, through the financialization of EigenLayer assets in derivatives contracts. By doing so, 3Jane unlocks a novel yield layer for ETH-denominated assets through options. Users simultaneously earn:

1. collateral yield (ETH Mainnet PoS staking, AVS PoS restaking)

2. options yield (ex: call option premiums)

Depositors can wrap LRT’s in 3Jane and begin accruing options premiums yield, earning up to 15% APR in ETH terms in addition to staking and re-staking yield.

If the past six months were a golden age for infrastructure then next six months will be a golden age for anything EigenLayer financialization. 3Jane will simply swallow the entire restaking industry.

Mainnet coming soon.

Follow the 3Jane protocol twitter and join the telegram!

3Jane will not be offered to persons or entities who are U.S. Persons, Restricted Persons, or Sanctioned Persons. Access and use by such persons is expressly prohibited.

Loosely, it means any income-like yield earned from trading derivatives such as perpetuals and options. In crypto, this yield will mainly come from two places:

1. cash & carry yield (perpetuals). This is Ethena.

2. options premiums yield (options). This is 3Jane.

Ethena: Cash & Carry Derivatives Yield

Ethena sUSDe is just a construction of two positions:

1. long stETH spot

2. short ETH perpetuals on an exchange (collateralized by stETH)

By doing this, Ethena is effectively an onchain delta-neutral vehicle for farming derivatives yield — particularly the funding rate from exchanges.

3Jane: Options Premiums Derivatives Yield

3Jane eETH-C is just a construction of two positions:

1. long eETH spot

2. short ETH deep out-of-the-money options* on 3Jane (collateralized by eETH)

By doing this, 3Jane is effectively an onchain vehicle for farming derivatives yield — particularly the options premiums yield over-the-counter.

Mainnet coming soon.

Follow the 3Jane protocol twitter and join the telegram!

3Jane will not be offered to persons or entities who are U.S. Persons, Restricted Persons, or Sanctioned Persons. Access and use by such persons is expressly prohibited.

*Options are a type of derivative that grants options buyers access to leverage in crypto without getting liquidated, unlike perpetuals. However, just like perps traders must pay a funding rate to be able to trade on leverage, options buyers must pay something equivalent to options sellers called a premium to get access to leverage. As a result, selling options is commonly used as a way to earn yield by collecting premiums in exchange for taking on a short volatility position. Options are a multi-trillion dollar market in traditional finance. Selling options is not a risk-free strategy. Read more here.

State of the Space

We are witnessing a cambrian explosion in crypto-native yield-bearing assets enabled by EigenLayer’s restaking primitive. At time of writing, 14% of all staked ETH has been restaked equating to $14B TVL from native/liquid restaking.

In 2023, there was effectively 1 PoS yield source between ETH and BTC — you can stake your ETH on the Beacon Chain. Today, staked ETH and BTC can be re-pledged across an infinite number of cryptoeconomic systems and by doing so one can earn more yield in exchange for providing security. Specifically, this scales with the number of Actively Validated Services (AVS’s) live on EigenLayer (ETH) and the number of PoS chains live on Babylon Chain (BTC). As a result, you can have an infinite number of yield-bearing ETH and BTC variants with varying yield / risk profiles.

Ethereum

ETH security can now not only be used to secure ETH mainnet, it can now be re-pledged to secure AVS’s such as sidechains, data availability layers, new virtual machines, keeper networks, oracle networks, bridges, threshold cryptography schemes, trusted execution environments, etc. Operators secure AVS applications by running their software and in return receive AVS rewards. Operators are subject to slashing conditions of each AVS that it is securing.

Let’s imagine a scenario where there are 2 Operators {O1, O2} and 3 AVS’s {A1, A2, A3} live on EigenLayer. The power set of AVS’s represents all the possible combinations of AVS software that a Node Operator may run simultaneously, ranging from 1 AVS (isolated security) to all 3 AVS’s (pooled security). As a result, there are 7 (2³ — 1) possible combinations per Operator, and 14 in total between O1 and O2. Note that an Operator re-pledges the same ETH delegated to it across every AVS that it is running simultaneously. So, in this example with just 2 Node Operators and 3 AVS’s we have effectively gone from 1 asset (staked ETH) to 14 yield-bearing exotic variants of ETH, all with their own risk profile and importantly yield profile from each AVS.

Now, scale this to the current number of Node Operators (P2P, Chorus One, EtherFi, 01 Node, Ankr, etc.) and current number of AVS’s (EigenDA, Ethos, Lagrange, Espresso, Fhenix, etc.) and we get thousands of possible {Node Operator, AVS_1, …., AVS_n} combinations. Granted, in reality the only combinations are whatever each subset of AVS’s each Node Operator decides to run.

Bitcoin

Similar to EigenLayer with ETH assets, BTC can now be used to secure other PoS Chains through Babylon Chain. This enables staking idle BTC towards securing alternate PoS chains and earning yield. Babylon allows you to lock directly on the Bitcoin network and leverages extract one-time signature (EOTS) to enforce slashing. As a result, BTC holders can also stake and earn yield and get exposure to different risk profiles/ APR’s depending on what it is securing.

Stablecoins

Whereas EigenLayer allows users to access yield through proof-of-stake rewards, Ethena has built an on-chain vehicle for capturing cash-and-carry (long ETH spot, short ETH perpetuals) yield giving users upwards of 20% APY. sUSDe is yet another novel crypto-native yield-bearing asset.

Enter 3Jane

3Jane is a crypto-native derivatives protocol leveraging restaking and cash-and-carry to unlock a novel layer of derivatives yield. 3Jane enables the collateralization of all exotic yield-bearing ETH and BTC variants across EigenLayer, Babylon Chain, and Ethena, in options contracts, encompassing a market size of approximately $17.5 billion (and growing) at time of writing.

Options contracts are a type of derivative that grants options buyers access to leverage in crypto without getting liquidated, unlike perpetuals. However, just like perps traders must pay a funding rate to be able to trade on leverage, options buyers must pay something equivalent to options sellers called a premium to get access to leverage. As a result, selling options is commonly used as a way to earn yield by collecting premiums in exchange for taking on a short volatility position. Options are a multi-trillion dollar market in traditional finance. Selling options is not a risk-free strategy. Read more here.

Users will be able to execute the cash-and-carry as well secure other PoS-based chains, data availability layers, shared sequencer marketplaces, ZK / FHE co-processors, TEE committees, etc and collateralize those positions in a robust derivatives market. As a result, users can earn an additional yield of up to 40% APY on their natively restaked ETH, eETH, ezETH, rswETH, and sUSDe by selling options contracts and collecting premiums.

ETH Buy&Hold: 0% yield
Stake on Lido: +x% staking yield
Restake on EigenLayer: +y% restaking yield
Collateralize on 3Jane: +z% options yield

Mainnet coming soon.

Follow the 3Jane protocol twitter and join the telegram!

3Jane will not be offered to persons or entities who are U.S. Persons, Restricted Persons, or Sanctioned Persons. Access and use by such persons is expressly prohibited.