Ethereum

EigenLayer

DeFi

Edge

Yield

<p>EigenLayer, one of the biggest staking protocols on the Ethereum network, is facing a significant challenge that could potentially lead to a yield crisis.&nbsp;</p> 
<p>Industry observers are increasingly concerned about the growing difference between EigenLayer’s Total Value Locked (TVL) and its Actively Validated Services (AVS).</p> 
<h2 class="wp-block-heading" id="what-has-been-said-about-the-yield-crisis">What Has Been Said About The Yield Crisis</h2> 
<p>Chudnov, a pseudonymous employee of the derivatives exchange 3Jane, recently posted that EigenLayer’s Total Value Locked (TVL) exceeds $15 billion.&nbsp;</p> 
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper"> 
  <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
   <p lang="en" dir="ltr">1/ EigenLayer is facing a *major* yield crisis, and nobody is talking about it. <a href="https://twitter.com/eigenlayer?ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">@eigenlayer</a> has &gt;$15B in TVL but AVS's will actually need less than *10%* of that for security, which means yields may fall off a cliff</p>— chudnov (@chudnovglavniy) <a href="https://twitter.com/chudnovglavniy/status/1782253746615177568?ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">April 22, 2024</a>
  </blockquote>
  <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
 </div>
</figure> 
<p>However, Chudnov suggests that to maintain security, the Actively Validated Services (AVSs) require only a bit of that amount, possibly less than 10%. As such, it’s clear to see that EigenLayer users might experience reduced yield in the future.&nbsp;</p> 
<h2 class="wp-block-heading" id="the-liquidity-problem">The Liquidity Problem</h2> 
<figure class="wp-block-image">
 <img decoding="async" width="1200" height="717" src="https://www.cryptopolitan.com/wp-content/uploads/2024/04/image-93-1.jpg" alt="" class="wp-image-515252" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/04/image-93-1.jpg 1200w, https://www.cryptopolitan.com/wp-content/uploads/2024/04/image-93-1-300x179.jpg 300w, https://www.cryptopolitan.com/wp-content/uploads/2024/04/image-93-1-768x459.jpg 768w" sizes="(max-width: 1200px) 100vw, 1200px">
</figure> 
<p><a href="https://www.cryptopolitan.com/eth-liquid-restaking-protocol-yieldnest-raises-5-2m-in-contribution-round/" data-type="link" data-id="https://www.cryptopolitan.com/eth-liquid-restaking-protocol-yieldnest-raises-5-2m-in-contribution-round/">Liquid staking</a> is a method that enables users to stake their assets on a blockchain while still being able to access them in the form of liquid tokens.&nbsp;</p> 
<p>EigenLayer is popular among its users for <a href="https://ethereum.org/en/staking/" data-type="link" data-id="https://ethereum.org/en/staking/" rel="nofollow noopener" target="_blank">Ethereum staking</a>. It allows users to earn rewards without locking up their assets.&nbsp;</p> 
<p>However, there’s a big problem at hand. There’s a difference between what’s staked on EigenLayer (Total Value Locked or TVL) and what’s really needed for validation (Actively Validated Services or AVS).&nbsp;</p> 
<p>Even if more is staked, it doesn’t mean more work is needed for validation. So, as more people stake, the rewards might get split among more users. Over time, users would earn less.</p> 
<h2 class="wp-block-heading" id="what-s-next-for-eigenlayer">What’s Next for EigenLayer?</h2> 
<p>EigenLayer may need to explore various solutions to avoid a potential yield crisis. One goal is to enhance the utility of its liquid staking tokens within the DeFi ecosystem.&nbsp;</p> 
<p>One possible approach could involve innovating new functionalities for these tokens, expanding their use beyond traditional staking activities. By enabling users to use DeFi apps more while still earning staking rewards, EigenLayer could effectively bolster the attractiveness and versatility of its platform.</p> 
<p>Still, EigenLayer’s future is uncertain. It has to create a model to address its growing Total Value Locked (TVL) to remain a viable option for Ethereum stakers in the long run.&nbsp;</p> 
<p>Thus, EigenLayer’s upcoming developments and strategic adjustments will be crucial in shaping its sustainability and continued relevance within the Ethereum ecosystem.</p>

EigenLayer on the Edge of Potential Yield Crisis

Mục lục

Cryptopolitan_News

Các bài viết khác được xuất bản trên 23 thg 4, 2024

Bitcoin To More Than Double In Value To $150K By Year-End, Says Standard Chartered Analyst: 'We C...

South Africa Grants License to 75 Crypto Companies, Spearheads Crypto Revolution

Pudgy Penguins flips Bored Ape Yacht Club!

Solana Price Prediction: When Will the SOLANA Price Reach The $1000 Mark?

Bitcoin Market Trends: Whale Buys and Upcoming Catalysts Analyzed

Anticipated Mid-2024 Launch of Bitcoin ETFs in Hong Kong

Tham gia bản tin miễn phí của chúng tôi để cập nhật tin tức về tiền điện tử hàng ngày!