We recently briefed you on Swell Network, and their plans to build a restaking rollup. Today, we’re covering Ether.fi, another competitor in the Restaking scene, and the most dominant at that. Ether.fi leads the pack with $2.6B+ in TVL to date. Competitors include Puffer Finance (~$1.2B in TVL), Kelp DAO (~$620.55M in TVL), Eigenpie (~$315.65M in TVL), and of course, Swell Network (~$148.78M in TVL).
Ether.fi’s airdrop recently took place, with the TGE occurring soon after an unexpected announcement for a Binance ETHFI token launchpool…
Background on Ether.fi
Ether.fi’s ETHFI token currently represents the largest restaking bet available right now. Other LRT protocols simply haven’t launched their TGE yet, and existing tokens may be adjacent or indirect ways to gain exposure to restaking. Protocols providing marketplaces for restaking points like Pendle and Whales have gained some attention, notably Pendle which saw it’s Ethereum mainnet TVL increase by multiples with its introduction of LRT YTs.
While Ether.fi’s success is most correlated with restaking, it originated as a liquid staking protocol, like some of it’s LRT peers. TVL was mostly stagnant throughout 2023 before the rising tide of retaking emerged, as depicted below.
Integrating with Pendle also helped to boost user interest and activity involving Ether.fi; Ether.fi was the first option for users to earn points at an enhanced rate on Pendle. Furthermore, this option was available on the Arbitrum chain, with $eETH becoming and available asset on the rollup. While obviously overshadowed by Ethereum mainnnet, Arbitrum eETH pairs still facilitate millions in volume on a daily basis. It should be noted that the ETHFI airdrop claim takes place on Ethereum mainnet, regardless of what network users used to acquire their Ether.fi points. Ether.fi’s Whales market integration also shouldn’t be overlooked; $2M+ in Ether.fi points were traded prior to TGE.
Ether.fi Liquid
Ether.fi recently introduced Liquid, a suite of products under the Ether.fi umbrella which will help to blend DeFi activity and IRL spending. The suit consists of 3 products:
Stake:
Stake is basically the current product that Ether.fi currently provides; users can restake their ETH to EigenLayer.
The aim of ‘Stake’ is to sort of replace staking by making restaking the preferred method of earning yield on ETH.
This is especially true as ETH staking yield decreases below 3%.
Liquid:
Liquid launched on March 18th.
The premise behind Liquid is to provide DeFi applications for various versions of eETH right from the Ether.fi platform, making it easier than ever for users to access.
Shortly after launch, Liquid saw $40M+ in TVL deposited, consisting of ETH, eETH, or weETH, all earning restakign points and an 30% APY with a 12% base rate and 18% in ETHFI rewards.
A range of dApps are used to provide the yield available in Ether.fi Liquid
Ether.fi UI
Cash:
Ether.fi cash may be the most interesting offering of the suite; it allows users to spend their Ether.fi balance IRL.
Users will also have the chance to borrow against their stack, and spend these funds instead.
Features include a mobile MPC wallet and a credit card that can be connected to a user’s Ether.fi account via their wallet.
A payments L2 needs to be developed to support this with some built-in features to handle payment disputes and other qualify-of-life features that users come to expect from payment processors.
Cash is slated to be launched within 1 year.
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