What is the current state of the restaking industry and what are the potential changes ahead?
Recently, a series of factors including the realization of the airdrop expectations of @eigenlayer, the underwhelming performance of @RenzoProtocol after its launch, and the decrease in Fomo sentiment for other Restaking projects have undoubtedly cooled down the Restaking sector. How should we view the current situation of the Restaking industry and the potential changes ahead? Next, I will briefly share a few viewpoints:Author: Haotian
Recently, a series of factors including: the expectation of the airdrop from @eigenlayer, the underwhelming performance of @RenzoProtocol after its launch, and the diminishing FOMO sentiment around other Restaking projects, have undoubtedly cooled down the Restaking re-staking sector. How should we view the current state of the Restaking industry and the potential changes ahead? Next, I will briefly share a few viewpoints:
1) The Restaking sector has indeed experienced a long period of irrational prosperity, from the points war to ETHFI, Renzo, Puffer, Swell, and others that were highly anticipated by the market. The re-staking sector has fallen into a "locking liquidity" data showcase mode, where it seems that whoever can attract more assets to lock in will be able to create greater expected value in the future, thus obtaining a higher valuation to enter the market.
In my view, this valuation standard is far from accurate, as it overlooks an essential point: assets like locked LST certificates do not create incremental value for points. The underlying AVS network market situation can open up, and truly creating revenue is the beginning of value manifestation. Clearly, under irrational sentiment, everyone's expectations and focus have not been placed on the practical application layer of AVS; instead, they have been replaced by high expectations gained through attracting traffic and assets, which cannot be effectively supported.
2) The hasty issuance of tokens by Eigenlayer, along with the proposal of an intersubjective innovation paradigm, seems to me to be specifically aimed at "putting out fires and cooling down." If the Restaking points Lego war further demonizes, the pressure on Eigenlayer will be exponentially amplified. Any slight disturbance in Eigenlayer's future development process could trigger a chain reaction crisis in the re-staking industry.
The expected landing of Eigenlayer's token will significantly cool down the FOMO atmosphere of the points war, allowing the market to focus on the essence of the growth of the supporting point, the AVS network effect.
3) AVS (Active Validation Service), simply put, involves selecting some nodes from the tens of thousands of Ethereum node operators to enhance their corresponding hardware and technical service capabilities. This allows these Validators to maintain their original Ethereum consensus while also expanding their service capabilities to support the security of other Rollups and networks, thereby gaining the potential for additional revenue. (This is akin to abstracting some "mining pools" from a large number of "miners" and then expanding some business operations.)
The AVS network can be understood as strengthening some "middleware" services within the foundational infrastructure layer of Ethereum, allowing certain nodes to unite and provide decentralized Sequencer, decentralized Oracle, and other service capabilities for "packaging" and commercial output. Theoretically, as long as the capability boundaries of the nodes under AVS are sufficiently large, and as long as it operates within Ethereum's broad consensus framework, the potential application scenarios that can be developed will be very considerable.
To put it more simply, these middleware networks that previously required external consensus construction for integration can now directly leverage Ethereum's underlying infrastructure to possess such service capabilities, while also representing a certain level of Ethereum's security consensus. The AVS node enhancement application paradigm can be seen as a potential direction for increasing Ethereum's business expansion capabilities, but its focus is on enhancing node service capabilities and the real landing and benefit transformation of AVS network service capabilities, rather than the ancillary staking and re-staking expectations brought by AVS.
4) In fact, the AVS node enhancement application paradigm is also reflected outside the Ethereum network: for example, @MarlinProtocol can provide computing power support for AI model training demanders through distributed node enhancement; another example is @FlareNetworks, which can enhance its off-chain distributed Oracle node capabilities to directly integrate EVM networks and connect with on-chain ecosystems, opening up the narrative direction of Oracle As A Service. (I will follow up with a more detailed analysis later.) These enhancements to the capabilities of the underlying node operators can bring broader business growth capabilities to the original chain.
Looking back, Eigenlayer originally aimed to provide basic security capabilities for its EigenDA (the first AVS) through re-staking, but unexpectedly opened the "Pandora's box" of re-staking: on the negative side, without guidance and control, the false prosperity of re-staking could further amplify the potential liquidity crisis of the Ethereum network; on the positive side, interpreting from the perspective of AVS node capability enhancement, Restaking will indeed inject a new narrative direction and imaginative space into the blockchain ecosystem.
This is the future of the re-staking sector, nothing more.
