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Eclipse: The Speed of Solana and Liquidity of Ethereum?
Jake Kennis
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Introduction

Eclipse is a new L2 on Ethereum that uses the Solana Virtual Machine (SVM). With this, Eclipse brings the best of both worlds: access to Ethereum's liquidity/security properties and the SVM's high performance and speed. In other words, Solana-native apps can now launch on Eclipse, and the L2 benefits from the stack’s modularity, merging the two ecosystems where each other may lack - liquidity and scalability. Not only can Solana-native apps launch there, but EVM apps will also be able to co-exist on Eclipse through Neon EVM, which brings full EVM compatibility to Eclipse. Because Neon EVM is deployed as a smart contract on any SVM-chain (i.e Eclipse, Solana, etc.), EVM-based apps such as Aave can now get access to greater throughput and scalability.

As for the tech stack, Eclipse handles execution on the L2, settles to Ethereum mainnet, and posts data availability (DA) to Celestia. With Eclipse, Solana developers and the ecosystem at large can tap into the vast amounts of liquidity in the EVM ecosystem.

Sounds good but when is mainnet and what can I do as a user?

Recent Updates/Catalysts

The bridge from mainnet went live two weeks ago as noted here for deposits only. Withdrawals will be enabled when the public mainnet goes (expected first week of November 2024). However, apps are deploying there such as Orca where you can swap seamlessly between your SOL and ETH. Other apps will be expected to deploy in the near term as well.

tETH

They launched tETH which is a unified restaking token that allows users to deposit their favorite LRTs to earn restaked yield on Eclipse. tETH is an index of LRT tokens, which comprises of 5 LRTs including:

  • eETH
  • ezETH
  • rswETH
  • steakETH
  • pufETH

In return, users get one unified token, tETH, which aims to not fragment liquidity across many LRTs. Users deposit LRTs on mainnet where tETH is minted and then bridged to Eclipse via Hyperlane. tETH is similar to wstETH where it is an exchange rate bearing token such that the exchange rate to ETH will increase over time from the staking yield. AVS-related rewards will be claimed separately but the rewards will be a function of how long a user held the asset. In short, users that mint tETH will access restaking yields while getting access to yields on Eclipse DeFi, along with ecosystem incentives.

Future Catalysts

Given the synergies of the SVM and the broader EVM ecosystem, Eclipse stands to gain from future improvements in two of the world's largest user and developer communities. Specifically, they can integrate Firedancer for throughput improvements, have access to exponentially improving ZK stack (i.e proofs via RISC Zero), and they can be home to all of the most used apps today such as Aave and Uniswap.

On top of tETH, they also plan on expanding their LRT ecosystem for both ETH and SOL holders. This way, they aim to be a hub for LRTfi with a unified UX.

What to Do?

At the time of writing, users can bridge over from Ethereum mainnet and play around with apps such as Orca. Below we show the cumulative and daily deposits into the Eclipse canonical bridge from mainnet.

Source: Nansen Query

Given withdrawals are not enabled, the flows are up only with deposits accelerating in mid-October totaling over 1,838 ETH deposits across 44,404 users. There are other ways to bridge into Eclipse, such as Hyperlane or Orbiter, which are not covered. Deposit amounts are skewed, but to rank in the top 10% of addresses by ETH deposited, you'd only need 0.053 ETH—and 0.4 ETH to be in the top 1%.

Who are the early whales depositing into Eclipse?

Source: Nansen Query

For the top 5 wallets, we see a heavy ETH allocation spanning Ethereum and various layer 2s. Interestingly, most of these funds remain idle rather than actively deployed.

For those bridging over to play around, whether to farm a potential airdrop or just explore whats going on, you'll need to have either a Backpack or Nightly wallet installed. At the moment, Phantom is not supported on Eclipse. ETH is used for paying gas and they will eventually add in fee abstraction (like Base) to pay in alternative tokens but ensure you have ETH for transaction fees etc.

Conclusion
Eclipse looks strong, riding the momentum of crypto's biggest user and developer communities. With mainnet launching the first week of November, it might be worth bridging in and experimenting. Using tETH, you can re-use your existing LRTs on Ethereum while tapping into extra DeFi perks and possible rewards within the Eclipse ecosystem. It’s early, and only a few apps are live, but the arrival of the first SVM-based layer 2 on Ethereum is exciting.
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Disclosure: The authors of this content and members of Nansen may be participating or invested in some of the protocols or tokens mentioned herein. The foregoing statement acts as a disclosure of potential conflicts of interest and is not a recommendation to purchase or invest in any token or participate in any protocol. Nansen does not recommend any particular course of action in relation to any token or protocol. The content herein is meant purely for educational and informational purposes only and should not be relied upon as financial, investment, legal, tax or any other professional or other advice. None of the content and information herein is presented to induce or to attempt to induce any reader or other person to buy, sell or hold any token or participate in any protocol or enter into, or offer to enter into, any agreement for or with a view to buying or selling any token or participating in any protocol. Statements made herein (including statements of opinion, if any) are wholly generic and not tailored to take into account the personal needs and unique circumstances of any reader or any other person. Readers are strongly urged to exercise caution and have regard to their own personal needs and circumstances before making any decision to buy or sell any token or participate in any protocol. Observations and views expressed herein may be changed by Nansen at any time without notice. Nansen accepts no liability whatsoever for any losses or liabilities arising from the use of or reliance on any of this content.