“Once again, Uniswap found itself shrouded in controversy after revealing its new aggregator, UniswapX, which will leverage intents to take trade execution off-chain. Uniswap v4, Uniswap X, and other intent based DEXs are shaping up to be the major theme of 2024.” - The Year Ahead for DeFi 2024.
Our Year Ahead for DeFi 2024 covered it ALL:
🔷 Competition between LSDs and the Restaking Economy featuring @eigenlayer, @LidoFinance, and many more
🔷 Case Study - Uniswap: A Reference Point for DeFi’s adoption & Effects of UniswapX on LPs
🔷 App-Specific Rolloups and How these will scale Ethereum DeFi dissecting Protocols like @arbitrum, @Optimism, and @aevoxyz
🔷 Real World Assets: Design Space Opens Up
🔷 Assessment of @ethereum’s Roadmap
🔷 New Use Cases sparking Traction for Interest Rate Derivatives taking a Closer Look at @pendle_fi, @ipor_io, fixed rates, and the disconnect of Consumer Behavior
🔷 Decentralized Stablecoins’ tough Path Ahead: Will Decentralized Stablecoins ever gain Mass Adoption?
🔷 Payments: Crypto’s Largest and Oldest Challenge
🔷Wallets Make Drastic UX Strides and Become “Consumer Apps”
🔷 Projects We’re Watching
🔷 Surprises and Futuristic Ideas
One Key Takeaway:
1. Restaking: The Biggest Staking Development of 2024
@eigenLayer emerges as a protocol reshaping the staking paradigm. Going beyond Ethereum's security, EigenLayer extends the utility of staked ETH to actively validate services (AVS), encompassing bridges, appchains, rollup sequencers, and data availability networks.
It’s restaking options fall into four categories:
a. LSD Restaking (EigenLayer Native)
Deposit assets like stETH into EigenLayer smart contracts for restaking.
b. Liquid-LSD Restaking
Targets locked layer of LSD deposits to unlock liquidity, allowing flexible exits. Constrained by EigenLayer’s LSD deposit limits.
c. Native Restaking (EigenLayer Native)
Validators redirect validator withdrawal credentials to EigenLayer using EigenPod smart contracts.
d. Liquid Native Restaking
Comprehensive service for staking and restaking of ETH. No limits on native restaking amounts. Allows protocols to accrue fees from staked ETH.
@eigenLayer has rapidly gained traction with over $1 billion of LSDs restaked as of December 28, underscoring EigenLayer's appeal in unlocking the economic value of staked ETH for broader ecosystem security.
Liquid restaked ETH earns higher yield than traditional staked ETH positioning Money markets and CDP protocols as main beneficiaries who can impose higher borrowing fees. Drawing from stETH's loop model, where users borrow ETH to stake, a similar trend may emerge for liquid restaked ETH.
A nuanced challenge lies in varying risk profiles of each restaked layer. Integrating liquid restaked ETH with exposure to pooled risks, especially vulnerabilities in bridges, raises concerns. As a result, protocols may prefer liquid restaked ETH with isolated exposure to minimize slashing event risks.
This risk differentiation may lead to a fragmented future where value, utility, and implementation of restaked ETH varies greatly based on associated risks.
Restaking also presents substantial risks with potential industry-wide consequences. The allure of higher yields may drive the rehypothecation of ETH to riskier networks. For instance, a significant slashing event could trigger increased unstaking requests, leading to prolonged unstaking times. If liquid restaked ETH becomes a major DeFi collateral source, such an event could result in severe disruptions:
As the staking withdrawal queue expands, a rush to secondary markets may cause a substantial depegging event. Users leveraged against their restaked liquid ETH might face liquidation, contributing to bad debt for money markets as secondary market liquidity diminishes.
A significant deterrent to widespread adoption of liquid restaked ETH within DeFi could be a tail event causing larger issues. This risk is particularly substantial in designs involving pooled risks. Therefore, the adoption of liquid restaked ETH in money markets is advised to lean towards isolated pools for effective risk mitigation.
An Excerpt from last year’s 2023 DeFi Report uncovering emerging opportunities and pointing out trends early 👇
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
