How restaking works
On EigenLayer, a staker can either:
- Native restake — run an Ethereum validator with withdrawal credentials pointed at an EigenLayer contract. Your stake secures Ethereum and you opt in to also secure EigenLayer-connected services.
- Liquid restake — deposit stETH (or equivalent LST) into an EigenLayer pod. The LST’s underlying ETH is still securing Ethereum; the pod balance is additionally slashable by the services you opt into.
Each service you opt into has its own slashing conditions and yield. A rollup data-availability service might pay 1-2% APY for the risk of being slashed if the operator fails a liveness check. An oracle network might pay 3-5% APY for committing to honest reporting. Stacking multiple services on one stake compounds yield — and compounds slashing risk.
Liquid restaking tokens (LRTs) — ether.fi’s weETH, Renzo’s ezETH, Puffer’s pufETH, Kelp’s rsETH — wrap restaked positions for DeFi liquidity. Users deposit ETH, receive an LRT, and the LRT contract handles the validator ops and restaking allocations.
Current state and scale
EigenLayer alone ran over $15B TVL at its peak in 2024. LRT protocols collectively control most of the restaked ETH. The category is young — slashing events haven’t yet tested the mechanics at scale.
Risks and considerations
Restaking introduces fundamentally new risks to ETH holders:
- Slashing — stake can be slashed not just for bad validation of Ethereum, but for any service the staker opted into. A misconfigured AVS could slash a large fraction of stake for what was meant to be a minor infraction.
- Reputation-weighted risk — the same stake secures multiple services. A bad outcome on one can cascade if operators run aligned strategies.
- LRT peg risk — liquid restaking tokens can depeg if a large slashing event reduces backing, or if users rush to exit during stress (withdrawal queues on EigenLayer are real — unbonding can take 7-14 days).
- Concentration of security — if a handful of LRTs dominate, a bug in any one affects a significant fraction of Ethereum stake.
Ethereum’s core developers have expressed concern about restaking’s implications for base-chain security — specifically about “social consensus failure” where restaked services become large enough to influence core-chain decisions. For users, the practical advice: understand which services your LRT is opted into, diversify across LRTs for large positions, and treat restaking yield as payment for real risk, not free money.