Recently, a particularly eye-catching track has emerged in the Ethereum ecosystem: the re-staking track based on EigenLayer.
There are already numerous articles about this track on the Internet, but these articles mainly focus on introducing some projects that may have airdrops, and there are few descriptions of the principles and potential problems of this track.
Directly introducing the project seems straightforward and can immediately encourage readers to copy your work, but it is difficult for us to inspire us to independently look for and discover new projects and new opportunities.
Therefore, in the following article I will share with you my understanding of some basic principles and potential opportunities of this track.
The foundation of this track is EigenLayer. So everything starts with the EigenLayer project.
What is EigenLayer?
It is a solution dedicated to expanding the security of Ethereum staking to other ecosystems.
We all know that the security of the Ethereum blockchain comes from the participation of nodes in the Ethereum network in consensus. In order to allow the nodes participating in the consensus to work normally and not do evil, Ethereum has set up a mechanism: each node can only participate in block packaging and other work after pledging 32 ETH.
When a node works normally, it can get rewards; but when it acts maliciously or does not work normally, the ETH it pledged will be confiscated.
This mechanism is the foundation of the entire Ethereum security, and it is also a common mechanism used by other blockchains based on POS consensus.
Among all the blockchains based on POS consensus, Ethereum obviously has the highest security and the largest market value.
In this case, can we simply extend the security of Ethereum to other POS-based blockchains or systems that also require security?
So the idea of EigenLayer was proposed.
Its solution is very direct: since Ethereum nodes have already provided such high security for Ethereum, and since ETH's market value is the highest among all POS blockchains, why not directly guide Ethereum nodes to provide the same security for other POS blockchains or systems? Why not directly use ETH as the asset required for security collateral?
Following this line of thought, the most direct method is to allow Ethereum nodes to participate in the pledge of other POS blockchains or systems at the same time. In terms of technical implementation, the pledged ETH is pledged again to other POS blockchains or systems that require security.
If this method is further refined, developed and extended, four specific implementation methods will be generated:
The first is to use the ETH that has been pledged in Ethereum as collateral to pledge to other systems. This is equivalent to one ETH being used as a collateral asset for both Ethereum and other systems.
The second method is to pledge the ETH derivatives obtained through pledge (such as stETH obtained through Lido and rETH obtained through Rocket) to other systems. In this case, ETH is directly pledged in Ethereum and indirectly pledged in other systems.
The third method is derived from the first method. Since ETH can also be used as collateral for other systems, why not use derivative assets containing ETH as collateral? The most typical example is the trading pair (LP) tokens containing ETH in various decentralized exchanges. Such tokens are collateralized in other systems.
The fourth method is derived from the second method and imitates the third method. Since stETH and rETH can be used as collateral for other systems, we can also use derivative assets containing stETH and rETH as collateral, such as pledging the trading pair tokens containing stETH and rETH in various decentralized exchanges to other systems.
The above four modes are the mortgage methods described by EigenLayer in its white paper.
The design concept of EigenLayer is divergent and open. It is based on ETH, and regards ETH and its derived xxETH assets as valid assets, participating in the pledge of other systems.
Precisely because of the divergence and openness of the protocol, it leaves a lot of room for the development of this track.
Among the above four methods, except for the first one, the other three methods all use derivative assets. Project owners can create a variety of ETH-based derivative assets according to different scenarios and use them as collateral.
As a result, various nesting doll projects based on EigenLayer have emerged one after another, making this track extremely lively.
