EigenLayer Amasses More Than 10% Of Circulating LSTs

EigenLayer’s TVL tripled since temporarily removing caps on its LST pools on Feb. 5.

By: Samuel Haig Loading...

EigenLayer Amasses More Than 10% Of Circulating LSTs

EigenLayer, the pioneering Ethereum restaking protocol, has amassed more than 10% of circulating ETH liquid staking tokens after temporarily removing the caps on its LST pools.

On Feb. 5, EigenLayer announced it would accept unrestricted deposits in the form of liquid staking tokens (LSTs) until Feb. 9 at 8pm EST. The move proved an immediate success, with more than $1.5B worth of LSTs flowing into the protocol within 24 hours of the announcement.

EigenLayer’s total value locked (TVL) is up 163% since the caps were removed, with its TVL growing from $2.15B to $5.67B as of this writing. Data from Dune Analytics indicates EigenLayer currently hosts 10.7% of the circulating LST supply, with the metric tripling since the caps were lifted.

EigenLayer supports 12 LSTs after adding three more on Feb. 5. Lido’s stETH accounts for 56.7% of EigenLayer’s liquid staking TVL, followed by Swell’s swETH with 12%, Mantle’s mETH with 10.9%, and Stader’s ETHX with 5.6%.

LSTs boast a TVL of $37.1B, equating to 50.5% of the $73.8B worth of ETH that is currently staked, according to DeFi Llama.

EigenLayer storms DeFi rankings

EigenLayer is now the fifth-largest DeFi protocol after overtaking Uniswap on Feb. 7. The protocol allows users to simultaneously earn staking rewards plus additional yields for securing third-party Actively Validated Services (AVSs).

Users can either participate by natively restaking ETH, or by depositing LSTs into its pools. EigenLayer has previously incrementally raised the limits for its LST pools, with the Feb. 5 move comprising the first instance in which the protocol has offered unbridled access to LST users.

More than $1.6B worth of ETH is also natively restaked via the protocol, with EigenLayer now commanding 7.7% of the staked Ether supply including LSTs.

In a blog post, EigenLayer teased that it is preparing to permanently remove the limits on LST deposits on a pool-by-pool basis. The team said they are seeking to strike a balance between decentralization and neutrality.

Justin Sun, the founder of Tron, is among those taking advantage of the temporary absence of LST pool limits. Data from Arkham Intelligence shows Justin Sun depositing $258M worth of stETH to the protocol on Feb. 7.