KoinlyticsEthereum's validators stake 32 ETH and earn ~3% APR for keeping the chain honest. EigenLayer lets them opt into securing additional services (AVSs) with the same stake, in exchange for additional yield and additional slashing exposure.
Who is who
- Restakers. Individuals or LSTs delegating their ETH.
- Operators. Run the software for AVSs. Restakers pick which operators to trust.
- AVSs (Actively Validated Services). Anything that needs a decentralized set of validators: data availability (EigenDA), oracle networks, ZK provers, bridges, sequencer decentralization, coprocessors.
The mechanism
- You stake ETH natively (or via an LST like stETH).
- You deposit into EigenLayer, choosing an operator.
- The operator opts into AVSs.
- You earn AVS rewards on top of your ETH staking yield.
- If the operator misbehaves (per an AVS's slashing conditions), your restaked ETH gets slashed.
What actually gets slashed
Slashing on EigenLayer went live in April 2025 with the Ethos upgrade. Each AVS defines its own slashing conditions. Correlated slashing is the real fear: a single bug in an AVS could slash thousands of operators simultaneously. EigenLayer's design limits per-strategy exposure and requires AVSs to fund their own insurance pools.
Liquid restaking tokens (LRTs)
Ether.fi, Renzo, Kelp, Puffer, EigenPie let you deposit ETH and get a liquid token (eETH, ezETH, rsETH, pufETH, egETH) that represents your restaked position. You keep liquidity, defer operator picking to the protocol, and get exposure to multiple AVSs in one token. Ether.fi alone has held tens of billions.
Risks worth naming
- Smart contract risk on the LRT protocol itself.
- Correlated slashing across operators / AVSs.
- Concentration risk: one operator, one AVS, one LRT dominating flow.
- Peg risk: eETH depegging from ETH during unstake queues.
- Regulatory risk: LRTs may face securities scrutiny.
Where restaking fits
Yield-seekers who already stake ETH and can tolerate correlated risk. Consumers looking for slightly higher APR while keeping ETH exposure. Not the base layer of your portfolio.