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LST Update: EigenLayer and Yearn
Osgur Murphy O Kane
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Key Takeaways
6 min read
  • The report first looks at data from the first round of deposits into EigenLayer. The top address accounts for ~10% of total deposits. Keep a close eye out this week as they are expected to raise deposit caps.
  • The report then looks at Yearn’s yETH. It is a basket of LSTs, similar to unshETH, and governed by st-yETH, rather than veYFI.
  • yETH Deposits are opening on the 14th of July where users can deposit ETH (locked for 16 weeks). Depositors receive incentives from LST protocols and other users as they vote which LST will be included in the first instance of the protocol.

EigenLayer

EigenLayer is undoubtedly one of the most exciting and anticipated developments in Ethereum and the wider crypto ecosystem. Why? It introduces restaking, which is a mechanism that enables users to rehypothecate their staked ETH to get additional yield. By doing so, users can extend the underlying security of their staked ETH to applications integrated with EigenLayer. In short, restaking allows applications to access shared security from Ethereum.

There are a number of applications that can benefit from EigenLayer. Some of which include data availability layers, oracle networks, bridges, new consensus protocols, and of course, blockchains. Other implementations may be discovered over time, as the design space is quite...