Originally published on: December 06, 2024
EigenLayer, the leading restaking protocol on Ethereum, is introducing significant upgrades to its rewards program to offer more flexibility to both protocols and restakers. The changes, as detailed in a recent blog post on December 6th, will revolutionize the way rewards are distributed within the EigenLayer ecosystem.
One of the key updates includes allowing third-party protocols, known as actively validated services (AVSs), to allocate rewards to validators based on their performance. Additionally, validators, or “operators,” will now have the ability to set fee rates independently, providing them with more control over their earnings.
The aim of these upgrades is to enhance flexibility, efficiency, and customization within the EigenLayer ecosystem, making it a more dynamic and rewarding environment for all participants. These changes are set to go live on the mainnet in January, ushering in a new era of staking rewards.
EigenLayer, which was launched in 2023, has already amassed a significant user base, with dozens of AVSs and nearly $19 billion in restaked collateral. Restaking, a process where tokens are used to secure multiple protocols simultaneously, has become increasingly popular within the EigenLayer community.
With 20 AVSs already operational on EigenLayer’s mainnet and many more in development, the platform continues to expand its offerings to meet the needs of its growing user base. Notable AVSs include EigenDA, managed by Eigen Labs, and ARPA Network, which specializes in trustless randomization.
EigenLayer’s native token, EIGEN, which was unlocked on October 1st, is designed to offer enhanced security features for protocols. Trading at approximately $4.92 as of December 6th, EIGEN has quickly gained traction in the market, boasting a fully diluted market capitalization of nearly $8.25 billion.
To incentivize restakers, EigenLayer launched a programmatic rewards program on September 17th, offering EIGEN emissions comprising around 4% of the token’s total supply. This initiative aims to reward stakers based on their participation in AVSs, creating a sustainable ecosystem where value is distributed effectively.
With EigenLayer’s latest enhancements, the future of restaking rewards looks promising for protocols and restakers alike. Stay tuned for more updates as EigenLayer continues to reshape the DeFi landscape with its innovative solutions.