{"id":22126,"date":"2025-04-15T09:46:59","date_gmt":"2025-04-15T09:46:59","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=22126"},"modified":"2025-04-15T09:46:59","modified_gmt":"2025-04-15T09:46:59","slug":"eigenlayer-liquidity-restaking-protocols-lose-over-1-billion-in-tvl-ahead-of-key-update","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=22126","title":{"rendered":"EigenLayer Liquidity Restaking Protocols Lose Over $1 Billion in TVL Ahead of Key Update"},"content":{"rendered":"<div>\n<p><em>EigenLayer liquidity restaking protocols lose over $1 billion in TVL ahead of the April 17 slashing update. The upgrade will enforce accountability, boosting the reliability of AVSs depending on Ethereum validators for security. Will EIGEN prices recover after dumping 85% in two weeks?<\/em><\/p>\n<p><span data-preserver-spaces=\"true\">On EigenLayer, you can reuse your staked ETH on the Ethereum mainnet and earn additional yield by securing other services, called Actively Validated Services (AVSs), such as Ether.fi, Kelp, Renzo, Eigenpie, and more. According to DeFiLlama <\/span><a class=\"editor-rtfLink\" href=\"https:\/\/defillama.com\/protocols\/Liquid%20Restaking\/Ethereum\" target=\"_blank\" rel=\"noopener nofollow\"><span data-preserver-spaces=\"true\">data<\/span><\/a><span data-preserver-spaces=\"true\">, the liquidity restaking (LRT) total value locked (TVL) on Ethereum exceeds $5 billion. This number may increase in the coming months as ETH stakers diversify, seeking to earn even more income, effectively funneling funds into some of the <\/span><a class=\"editor-rtfLink\" href=\"https:\/\/99bitcoins.com\/cryptocurrency\/best-crypto-to-buy\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">best cryptos to buy in 2025<\/span><\/a><span data-preserver-spaces=\"true\">.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">EXPLORE:\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/99bitcoins.com\/cryptocurrency\/new-cryptocurrency\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Best New Cryptocurrencies to Invest in 2025<\/span><\/a><\/strong><\/p>\n<h2><span data-preserver-spaces=\"true\">Liquidity Restaking TVL Loses Over $1 Billion In 2 Weeks<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">However, the recent explosion of EigenLayer TVL may find headwinds. <\/span><\/p>\n<p><span data-preserver-spaces=\"true\">On April 17, EigenLayer will implement a key update to bring greater accountability to its multi-billion-dollar ecosystem and likely strengthen it.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\"> After years of testing, the restaking platform will activate the slashing feature, stabilizing its ecosystem and improving the reliability of its services, especially for AVSs that demand higher uptime and seamless operations.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Data from IntoTheBlock shows that liquidity restaking TVL is rapidly shrinking, having lost over $2 billion in the two weeks leading up to the April 17 update. <\/span><\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">The unstaking queue spiked for many LRT protocols over the last week.<\/p>\n<p>The reason? Eigenlayer slashing takes effect this week, potentially prompting risk-averse stakers to exit<\/p>\n<p>Track Risk Alerts<img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/1f447.png\" alt=\"\ud83d\udc47\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"><br \/><img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/1f517.png\" alt=\"\ud83d\udd17\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"><a href=\"https:\/\/t.co\/iq3PJyT5M7\" target=\"_blank\" rel=\"nofollow\">https:\/\/t.co\/iq3PJyT5M7<\/a> <a href=\"https:\/\/t.co\/ltuIvztPPQ\" target=\"_blank\" rel=\"nofollow\">pic.twitter.com\/ltuIvztPPQ<\/a><\/p>\n<p>\u2014 IntoTheBlock (@intotheblock) <a href=\"https:\/\/twitter.com\/intotheblock\/status\/1911825573548310962?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"nofollow\">April 14, 2025<\/a><\/p>\n<\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p><span data-preserver-spaces=\"true\">At press time, DeFiLlama data indicates that the sector commands a TVL of $6.8 billion, down from the $8 billion recorded on April 1.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">In the last two weeks, major LRT protocols have seen a sharp spike in unstaking requests. Reflecting this trend, the TVL of Kelp, Renzo, Inception, and Mello LRT, for example, has dropped by double digits in the past month. Ether.fi, the largest LRT, has seen its TVL decrease by 8% in one month to around $4.2 billion. <\/span><\/p>\n<p><span data-preserver-spaces=\"true\">According to IntoTheBlock analysts, the decision to unstake before the slashing update is a strategy to cushion against potential capital loss.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">EXPLORE:\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/99bitcoins.com\/cryptocurrency\/best-ai-crypto-coins\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">10 Best AI Crypto Coins to Invest in 2025<\/span><\/a><\/strong><\/p>\n<h2><span data-preserver-spaces=\"true\">Why Slashing On EigenLayer Is Good<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">Once EigenLayer activates slashing, it will enforce accountability across its Ethereum-based security network. As a result, operators who underperform or misbehave will be penalized. While this may seem harsh from the stakers\u2019 perspective, the goal is to enhance the restaking platform\u2019s reliability and integrity.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Slashing will be executed via AVS smart contracts. For example, all penalties charged on downtime, double signing, or failure to validate will be imposed automatically. <\/span><\/p>\n<p><span data-preserver-spaces=\"true\">The good news is that penalties will vary depending on the severity of the violation. Depending on the harm caused to the ecosystem, they may range from partial burns of staked amounts to redistribution of the affected stake.<\/span><\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">1\/ Introducing Slashing \u2013 Testnet Launch  <\/p>\n<p>Slashing Testnet is officially live. <img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/1f5e1.png\" alt=\"\ud83d\udde1\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"><\/p>\n<p>This proposed protocol upgrade (ELIP-002) introduces slashing, a critical tool for AVSs to enforce cryptoeconomic commitments. <a href=\"https:\/\/t.co\/u9wzInoeEG\" target=\"_blank\" rel=\"nofollow\">pic.twitter.com\/u9wzInoeEG<\/a><\/p>\n<p>\u2014 EigenLayer (@eigenlayer) <a href=\"https:\/\/twitter.com\/eigenlayer\/status\/1870107078833869127?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"nofollow\">December 20, 2024<\/a><\/p>\n<\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p><span data-preserver-spaces=\"true\">However, to prevent systemic slashing shocks, EigenLayer will implement a unique stake system. Instead of pooling all stakes into one risk pool, operators will allocate a specific amount to individual AVSs. This way, any event will unlikely lead to contagion, making the platform more robust through diversification.<\/span><\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\"><img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/1f6a8.png\" alt=\"\ud83d\udea8\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"> Attn. Operators! <\/p>\n<p>Slashing hits mainnet April 17<\/p>\n<p>Here are 3 things every Operator needs to know:<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/2611.png\" alt=\"\u2611\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"> You can\u2019t be slashed unless you explicitly opt into Operator Sets created by AVSs.<br \/><img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/2611.png\" alt=\"\u2611\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"> You can designate a unique stake for each AVS you support.<br \/><img decoding=\"async\" src=\"https:\/\/s.w.org\/images\/core\/emoji\/15.0.3\/72x72\/2611.png\" alt=\"\u2611\" class=\"wp-smiley\" style=\"height: 1em; max-height: 1em;\"> You can align with AVSs\u2026 <a href=\"https:\/\/t.co\/RvumfG5tZ9\" target=\"_blank\" rel=\"nofollow\">pic.twitter.com\/RvumfG5tZ9<\/a><\/p>\n<p>\u2014 EigenLayer (@eigenlayer) <a href=\"https:\/\/twitter.com\/eigenlayer\/status\/1909691029714071905?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"nofollow\">April 8, 2025<\/a><\/p>\n<\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p><span data-preserver-spaces=\"true\">Additionally, there is an option to participate in an AVS that enforces penalties. Each AVS must clearly define slashing terms in its smart contract for transparency and risk reduction before funds are committed.<\/span><\/p>\n<h2><span data-preserver-spaces=\"true\">Will EIGEN Prices Recover After The 85% Plunge?<\/span><\/h2>\n<p><span data-preserver-spaces=\"true\">As LRTs unstake, EIGEN remains under pressure, trailing some of the <\/span><a class=\"editor-rtfLink\" href=\"https:\/\/99bitcoins.com\/cryptocurrency\/best-solana-meme-coins\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">best Solana meme coins to buy in 2025<\/span><\/a><span data-preserver-spaces=\"true\">. After spiking to over $5.5 in December 2024, the token has been plunging, losing over 85% in four months.<\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full\" src=\"https:\/\/www.tradingview.com\/x\/jvryu8j1\/\" width=\"1499\" height=\"859\"><\/p>\n<p><strong>(<a class=\"general-link\" href=\"https:\/\/www.tradingview.com\/x\/jvryu8j1\/\" target=\"_blank\" rel=\"noopener nofollow\">EIGENUSDT<\/a>)<\/strong><\/p>\n<p><span data-preserver-spaces=\"true\">Depending on the reception of the slashing update, EIGEN may find relief and bounce higher or drop to new 2025 lows in a bear-trending continuation formation.<\/span><\/p>\n<p><strong><span data-preserver-spaces=\"true\">DISCOVER:<\/span><\/strong> <a class=\"editor-rtfLink\" href=\"https:\/\/99bitcoins.com\/cryptocurrency\/best-meme-coin-icos\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">6 Best Meme Coin ICOs &amp; Presales to Invest in 2025<\/span><\/a><\/p>\n<div class=\"nnbtc-key-takeaways\">\n<h3 class=\"nnbtc-key-takeaways__title\">EigenLayer TVL Drops $1B Before Slashing Update, EIGEN Down 85%<\/h3>\n<ul class=\"nnbtc-key-takeaways__list\">\n<li class=\"nnbtc-key-takeaways__list-item\">\n         <span data-preserver-spaces=\"true\">EigenLayer TVL shrinks ahead of slashing update<\/span><span data-preserver-spaces=\"true\">\u00a0<\/span>    <\/li>\n<li class=\"nnbtc-key-takeaways__list-item\">\n         <span data-preserver-spaces=\"true\">Slashing will make the ecosystem more reliable and boost accountability<\/span><span data-preserver-spaces=\"true\">\u00a0<\/span>    <\/li>\n<li class=\"nnbtc-key-takeaways__list-item\">\n         <span data-preserver-spaces=\"true\">Penalties will be charged for failures, but severity varies depending on AVS conditions<\/span><span data-preserver-spaces=\"true\">\u00a0<\/span>    <\/li>\n<li class=\"nnbtc-key-takeaways__list-item\">\n         <span data-preserver-spaces=\"true\">EIGEN down 85% in four months. Will EIGENUSDT find relief?<\/span><span data-preserver-spaces=\"true\">\u00a0<\/span>    <\/li>\n<\/ul><\/div>\n<p>The post <a href=\"https:\/\/99bitcoins.com\/news\/eigenlayer-liquidity-restaking-protocols-lose-over-1-billion-in-tvl-ahead-of-key-update\/\">EigenLayer Liquidity Restaking Protocols Lose Over $1 Billion in TVL Ahead of Key Update<\/a> appeared first on <a href=\"https:\/\/99bitcoins.com\/\">99Bitcoins<\/a>.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>EigenLayer liquidity restaking protocols lose over $1 billion in TVL ahead of the April 17 slashing update. The upgrade will enforce accountability, boosting the reliability of AVSs depending on Ethereum validators for security. Will EIGEN prices recover after dumping 85% in two weeks? On EigenLayer, you can reuse your staked ETH on the Ethereum mainnet [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[2],"tags":[3,4,5],"class_list":["post-22126","post","type-post","status-publish","format-standard","hentry","category-news","tag-crypto","tag-doge","tag-news"],"_links":{"self":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/22126","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=22126"}],"version-history":[{"count":0,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/22126\/revisions"}],"wp:attachment":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=22126"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=22126"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=22126"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}