EigenCloud (prev. EigenLayer) (EIGEN) Price

What is EigenLayer?

EigenLayer is an innovative protocol built on Ethereum that introduces restaking, a new cryptoeconomic primitive. This allows Ethereum stakers to reuse their staked ETH or liquid staking tokens (LSTs) to secure multiple decentralized services, extending Ethereum’s security layer to additional applications. By opting into EigenLayer smart contracts, stakers can enhance the security of these services while earning additional rewards. The protocol taps into Ethereum’s pooled security, significantly reducing capital costs for staking while promoting free-market governance and permissionless innovation. This makes EigenLayer a game-changer for those building decentralized services, allowing them to leverage Ethereum’s existing security without creating separate trust networks.

How Does EigenLayer Work?

EigenLayer works by enabling ETH holders to restake their assets on the Ethereum network. Stakers who have already committed their ETH through native staking or LSTs can choose to participate in Actively Validated Services (AVSs), which are decentralized applications built on the EigenLayer protocol. Operators are responsible for running the AVS software, maintaining the integrity of the network. Stakers can either delegate their ETH to these operators or run the services themselves, a process known as delegation. By doing so, stakers help secure these services, while still retaining control over which AVSs they validate. This approach allows EigenLayer to offer enhanced security to various Web3 services, all while maximizing rewards for stakers.