EIGEN Unlocking Soon? A Brief Analysis of EigenLayer's Current Valuation and Profit Expectations

Author: Azuma, Odaily Planet Daily

In the past two days, EigenLayer, the pioneer of the restaking track, has announced two major developments regarding the EIGEN token.

• First, the Season 2 airdrop is now open for claims, and the claiming window will last until March 16, 2025.

• Second, it will launch Programmatic Incentives V1, which will distribute EIGEN incentives weekly to qualified stakers and operational nodes starting in October (with historical behavior tracked back to August 15). It is expected that approximately 66.95 million EIGEN will be allocated in the first year, equivalent to 4% of the initial supply of EIGEN.

Some users who are following EigenLayer believe that the sudden acceleration of EigenLayer's pace is to warm up for the upcoming "EIGEN Unlock" event, aiming to gain more market attention and participation after EIGEN officially circulates.

On May 10 of this year, EigenLayer opened claims for the Season 1 airdrop, but since then, the EIGEN token has remained non-transferable, which has somewhat "teased" users and prevented EigenLayer from gaining a level of discussion in the secondary market that matches its status.

When Will EIGEN Be Unlocked?

Regarding the unlocking time of EIGEN, it is first necessary to clarify a long-standing misconception in the market ------ that the unlocking date is September 30.

This misconception arose because the Eigen Foundation mentioned the date of September 30 in its official documentation about the unlocking timeline in May. However, if you look closely at the Eigen Foundation's description, you will find that it actually states: "Earlier this week, we announced that EIGEN will unlock after new features are live and further decentralization is achieved, but we have not disclosed a specific date. To clarify the timeline, we plan to implement these features on the mainnet before September 30, 2024."

From the Eigen Foundation's statement, it can be seen that the transfer function of EIGEN should be unlocked after "new features are live and further decentralization" is achieved, while September 30 is the expected timeline set by EigenLayer for "new features to go live and further decentralization."

Regarding the progress of "new features going live and further decentralization," "new features" is a relatively subjective concept. Since May, EigenLayer has successively launched features such as "AVS Rewards" and "Programmatic Incentives," but it is difficult for outsiders to assess EigenLayer's own evaluation of the progress; as for the progress of "further decentralization," it is relatively measurable. The first season airdrop of EigenLayer has ended, with a final claiming rate of about 78.6%. The second season airdrop and subsequent incentive plans will further accelerate the distribution of the EIGEN token.

In summary, EigenLayer has not mentioned that the transfer function of EIGEN will be unlocked on September 30, but based on the completion progress of "further decentralization," I personally predict that after the second season airdrop and incentive plan are opened, the final unlocking time of EIGEN will not be delayed too long.

EigenLayer Basic Data and Valuation Expectations

According to DeFillama data, EigenLayer currently has a total TVL of $10.79 billion, ranking third among all protocols in the ecosystem, only behind the liquid staking giant Lido and the lending leader Aave.

EigenLayer's official data shows that the protocol currently supports 16 AVS (Active Validation Services), including EigenDA, covering multiple fields such as DA, oracles, privacy, DePin, gaming, and ZK validation. Although major restaking protocols from different ecosystems, such as Symbiotic, Karak, Solayer, and Jito, are emerging vigorously, EigenLayer still remains the protocol with the largest value scale, fastest development progress, and strongest network effects in the entire restaking track.

The emphasis on "network effects" is because, in addition to its strong fundamental performance, EigenLayer has almost single-handedly driven a significant portion of innovation in the Ethereum ecosystem. Surrounding liquidity restaking and tangible AVS services, a large number of projects, including ether.fi, Renzo, Puffer, Eigenpie, AltLayer, Omni, and eoracle, have found their application scenarios relying on the development of EigenLayer.

This is also why the community has jokingly referred to EigenLayer as the "guardian" of Ethereum's "imperial court"…

In terms of valuation, although the transfer function of EIGEN has not yet been activated, some pre-market trading platforms, including Aevo, have already started contract trading for EIGEN. As of the time of writing, EIGEN is temporarily priced at $2.95 on Aevo.

Since the total supply of EIGEN at genesis was 1.67 billion tokens, a price of $2.95 implies that EigenLayer's corresponding FDV is approximately $4.9265 billion.

As for the initial circulating market value, EigenLayer has not yet disclosed the initial circulation structure of EIGEN, but we can make a simple calculation of user holdings based on the data from the two airdrops (not considering the incentive plan, as it will start weekly distribution in October, with a relatively small proportion of early circulation). A total of approximately 87.89 million EIGEN were claimed in the first season airdrop (with a claiming rate of about 78.6%); the second season airdrop will distribute a total of 86 million EIGEN (60 million to stakers and operational nodes, 10 million to ecosystem partners, and 6 million to community contributors). If the claiming rate is the same as in the first season, the final claimed amount is expected to be 67.59 million, bringing the total claimed amount from both seasons to 155 million EIGEN.

This means that the total value of EIGEN obtained by all users through the two seasons of airdrops is approximately $457 million ------ this is also the portion of EIGEN that can be confirmed to be in full circulation.

Will There Be More Airdrops in the Future?

Earlier this year, when announcing the first season airdrop, EigenLayer mentioned that 15% of the EIGEN tokens would be distributed in the form of airdrops, and the announced first and second season airdrops are planned to distribute 113 million and 86 million EIGEN respectively, totaling about 200 million EIGEN, which accounts for about 11.9% of the total initial supply of 1.67 billion.

This means that, according to EigenLayer's plan, approximately 3.1% of EIGEN tokens will still be used for future airdrop rounds.

From my personal participation experience, considering that the second round of airdrops did not adopt the minimum "even distribution" plan of 100 tokens as in the first round, the airdrop shares available to small stakers have become relatively limited (after all, the base is too large), and larger airdrop amounts are mostly allocated to whale users, operational nodes, and community contributors ------ especially KOLs who have created high-quality content related to EigenLayer on social media, who generally received thousands or even tens of thousands of EIGEN airdrops.

Therefore, in subsequent potential airdrop rounds, small stakers who continue to stake on EigenLayer for airdrop purposes may no longer have ideal profit expectations, unless they take alternative paths, such as choosing higher-threshold participation methods like original content creation.

Incentive Plan Launch, What Are the Profit Expectations?

In addition to airdrops, another direct way to earn EIGEN is through the incentive plan that will launch in October, which aims to distribute EIGEN incentives weekly to qualified stakers and operational nodes.

EigenLayer officially stated that this incentive measure will implement retroactive rewards based on staking conditions since August 15, 2024, with the first round of rewards opening for claims weekly starting in October. In the first year of this plan, approximately 66.95 million EIGEN is expected to be allocated, equivalent to 4% of the initial supply of EIGEN tokens.

Combining the above data, we can make a simple calculation of the potential yield situation for stakers under this incentive plan.

First, the distribution targets of the incentive plan are stakers and operational nodes, but EigenLayer has not specified the allocation ratio between the two groups. Therefore, we chose to refer to the allocation ratio for stakers and operational nodes when EigenLayer designed the second season airdrop. As shown in the figure below, EigenLayer allocated 3.68% of EIGEN to stakers and 0.52% to operational nodes in the second season airdrop, with a rough allocation ratio of 88:12 between the two groups.

Based on this ratio, of the total incentive share of 66.95 million EIGEN in the first year, it is expected that 58.91 million EIGEN will be distributed to stakers, which, at a price of $2.95, amounts to approximately $174 million. As mentioned earlier, EigenLayer currently has a total TVL of $10.79 billion, which means that the potential yield for stakers under this incentive plan is expected to be 1.6%.

It should be emphasized that the above calculation is a rough estimate based on subjective allocation predictions and static token prices, and the final yield situation will still depend on EigenLayer's actual progress. Although a yield of 1.6% may not seem objective, the stakers on EigenLayer are primarily large fund users with a "security/yield" bias towards the left, who will pay more attention to the protocol's security level and liquidity status. On this basis, considering that EigenLayer can also provide around 3% in native staking rewards, coupled with the appreciation expectations of EIGEN, staking on EigenLayer still possesses certain capital attractiveness.