Renzo lures Ethereum stakers away from Lido to Ether.fi
Ethereum has experienced a decline in prices of more than 4% over the past month, prompting ETH holders to shift their focus from Lido Finance to other restaking protocols. Data from a Dune Analytics dashboard that monitors staking activity revealed that Lido Finance had the highest outflow of Ethereum among similar protocols during this period. Approximately 284,800 ETH was withdrawn from Lido’s platform. However, despite this setback, Lido still maintains its dominant position in the Ethereum staking sphere, commanding a market share of 29.7%.
On-chain data indicates that ETH stakers are now gravitating towards liquid restaking protocols. Notably, Lido experienced the largest outflows, while Ether.fi and Renzo Protocol attracted substantial inflows of over 400,000 and 280,100 Ether, respectively. According to DefiLlama, Ether.fi and Renzo are the two largest liquid restaking platforms available, with total value locked (TVL) of $3.1 billion and over $2.1 billion invested, respectively. In total, these protocols have accumulated over $8 billion in locked assets.
The shift from Lido to liquid restaking platforms like Ether.fi and Renzo highlights the growing interest in Eigenlayer points among participants in the decentralized finance (defi) space. Liquid restaking protocols leverage Eigenlayer’s platform to enable stakers to secure other networks and solutions using ETH. This practice originated from staking, a key feature of Ethereum’s blockchain after the Merge in September 2022, which involved transitioning from a proof-of-work to a proof-of-stake consensus mechanism. Under the new paradigm, stakers play a crucial role in safeguarding Ethereum’s chain by locking up ETH with validators to enhance security.
Eigenlayer has further expanded on this initiative by utilizing staked ETH for a broader range of protocols and chains linked to Ethereum. Participants in the protocol are rewarded with points, and there is speculation that these points could potentially be converted into a token airdrop in the future.
The increasing popularity of liquid restaking protocols is evident from the rankings provided by DefiLlama. As the interest in decentralized staking grows, Ethereum’s co-founder has proposed a new plan to boost decentralization in crypto staking, indicating the industry’s ongoing development and innovation in this space.
Follow Us on Google News
