The total amount of funds locked on Ethereum's EigenLayer re-staking protocol has grown by 70% over the past week and reached an all-time high of $3.4 billion, DeFiLlama reports. 🚀

The reason for the increase was the resumption of deposits on the re-staking platform and the lifting of staking restrictions. As of February 6th, all pools are fully open and the protocol welcomes new partners: Frax Finance, Liquid Collective and Mantle. 🤝

Repeat staking allows users to stake the same ETH on Ethereum and other protocols. This enables smaller and newer blockchains to leverage Ethereum's robust security and trust system, reducing the risk of attacks or failures.

However, the EigenLayer protocol faces a trade-off between neutrality (allowing free market behavior) and decentralization (preventing the dominance of a single token). Temporarily removing restrictions on token re-staking makes the protocol more neutral, but a fully neutral protocol risks dominance of a single token in governance and incentives.

To achieve a balance between neutrality and decentralization, EigenLayer proposed three rules on February 5: no cap on the cost of staking tokens, no cap on payouts from apps to stakers, and a 33% cap on incentives and governance of the EigenLayer protocol for any token or participant.

As a result, Ethereum re-staking could become one of the main cryptocurrency events of 2024.