Eigenlayer (EIGEN)
EigenLayer is a protocol on the Ethereum blockchain that introduces the concept of restaking, enhancing crypto-economic security. This functionality allows users who stake ETH directly or through a liquid staking token (LST) to engage with EigenLayer smart contracts voluntarily. By opting in, users can restake their ETH or LST, extending crypto-economic security to additional applications on the network and earning supplementary rewards.
Overview
EigenLayer was founded in July 2021 by Sreeram Kannan. The platform enables Ethereum stakers to enhance security for multiple services by restaking their ETH and participating in various services simultaneously. This leads to pooled security via restaking. The reuse of ETH in securing different services reduces capital costs for stakers and significantly improves trust guarantees for individual services. EigenLayer addresses the common challenge of establishing a new trust network for security, allowing any service, regardless of its composition, to access the pooled security provided by Ethereum's stakers. This approach encourages an environment conducive to permissionless innovation and free-market governance. EigenLayer launched its Stage 1 mainnet on June 14, 2023, as a guarded launch with restaking limits.
| Ticker | EIGEN |
| Category | Infrastructure |
| Website | https://eigenfoundation.org/ |
| @eigenfoundation | |
| Contract Addresses | |
|---|---|
| ethereum | 0xec...83 Copied! |
Funding
EigenLayer raised $14.5 million in a seed round in August 2022, led by Polychain Capital and Ἀthereal Ventures. On March 8, 2023, EigenLayer announced it had raised $50 million in a Series A round led by Blockchain Capital. Other firms in the round included Electric Capital, Polychain Capital, Hack VC, Finality Capital Partners, and Coinbase Ventures. On February 22, 2024, Eigen Labs, the developer behind EigenLayer, raised $100 million from venture capital investor a16z crypto.
Technology
Pooled security via restaking
EigenLayer introduces a streamlined approach to pooled security known as "restaking." This involves Ethereum validators linking their beacon chain withdrawal credentials to EigenLayer smart contracts, opting into various modules on the EigenLayer platform. Validators run additional node software for these modules, allowing them to impose slashing conditions on staked ETH. In return, validators earn extra revenue for providing security to these modules. This restaking mechanism facilitates a robust transfer of cryptoeconomic security, extending beyond traditional smart contract-based DApps to include virtual machines, consensus protocols, and middleware.
Open marketplace
EigenLayer establishes an open marketplace to regulate the supply of pooled security by validators and its consumption by AVSs. In this marketplace, validators can decide whether to participate in each module on EigenLayer. To attract restaked ETH, modules must offer adequate incentives to validators, who play a key role in determining the allocation of pooled security based on potential slashing risks. EigenLayer's opt-in dynamics bring two significant advantages: it complements the stable governance of the core blockchain with a dynamic, efficient free-market governance structure for launching new auxiliary capabilities, and the opt-in validation allows new blockchain modules to leverage diverse resources among validators, leading to well-balanced trade-offs between security and performance.
Team
- Sreeram Kannan - CEO
- Robert Raynor - Engineering
- Soubhik Deb - Engineering
- Vyas Krishnan - Product
- Chris Dury - COO
- Calvin Liu - CSO
- Sid Sanyal - VP of Engineering
- Brianna Montgomery - Strategy
- Wes Floyd - Solutions Architect
- Tina Haibodi - Product
Introducing new LSTs
On January 24, 2023, EigenLayer announced the addition of restaking support for three new Liquid Staking Tokens (LSTs): Frax Ether (sfrxETH), Mantle Staked Ether (mETH), and Liquid Staked Ether (LsETH). EigenLayer also reopened for restaking at the existing cap of 200k ETH for each LST.
EIGEN Token
The EIGEN token is a universal intersubjective work token. A work token can be staked to perform tasks within a blockchain platform, such as execution or validation. The four key features in EIGEN staking include universality, isolation, metering, and compensation.
Universality
EIGEN can be universally used for resolving any intersubjectively attributable fault. Any AVS that wants to use the cryptoeconomic benefits of EIGEN must encode the rules of coordination in their respective setup phase. These AVS-specific rules, such as slashing conditions, ensure that any intersubjectively attributable fault is self-verifiable beyond a reasonable doubt.
Isolation
EIGEN features isolation through a two-token model. The first token, bEIGEN, is used for staking and can be subjected to forking. The other token, EIGEN, remains unaware of forks in bEIGEN, allowing it to be used for DeFi or non-staking applications without externalities.
Metering
Resolving any intersubjective fault incurs a cost to social consensus. Any claim to fork the token requires depositing a bond in bEIGEN to deter malicious challenges. Successful challenges should only be raised if sufficient staked EIGEN can be considered malicious and burnt, resulting in a lower token supply.
Compensation
The protocol ensures that if an AVS is attacked by a malicious quorum of EIGEN stakers, the AVS can slash and redistribute the malicious stake back to its users. This achieves strong cryptoeconomic security, ensuring no honest user suffers harm. Using EIGEN for resolving intersubjectively attributable fault ensures Ethereum's social consensus is not overloaded.