Solana News Today: Restaking Drives Capital Efficiency and Security in Crypto with Rising TVL and Dual Staking Models

Restaking in the cryptocurrency space is gaining traction as a method to enhance capital efficiency for token holders while offering robust security to emerging blockchain protocols. Unlike traditional staking, where assets are locked on a primary network, restaking allows users to deploy the same staked tokens across multiple protocols simultaneously. This innovation enables validators to earn additional rewards by securing secondary protocols, albeit with increased slashing risks.

The concept of restaking is built upon the foundation of liquid staking, which transforms staked tokens into liquid equivalents that can be utilized in decentralized finance (DeFi) applications. Restaking takes this a step further by repurposing these staked assets to secure new networks. This approach not only provides more yield opportunities for stakers but also ensures that new protocols achieve security from their inception, bypassing the need to build their own validator sets from scratch [1].

Restaking works by allowing validators on proof-of-stake (PoS) blockchains such as Ethereum and Solana to use their staked assets to secure other PoS protocols. This expands the utility of staked assets and offers additional rewards, though it introduces the risk of slashing—where validators lose a percentage of their staked tokens for violating protocol rules. Restaking protocols often impose additional slashing conditions to ensure validator compliance [1].

There are two primary types of restaking: native and liquid. Native restaking requires validators to run additional node software and agree to the restaking terms, including extra slashing conditions. Protocols like EigenLayer, Symbiotic, and Karak offer native restaking services. On the other hand, liquid restaking involves converting staked tokens into liquid restaking tokens (LRTs), which can be used in DeFi to generate yield. Protocols such as Renzo and Ether.fi facilitate liquid restaking, making it more accessible to a broader range of users [1].

The potential benefits of restaking are significant. For stakers, it offers improved rewards by enabling them to earn additional income from securing multiple protocols. For new protocols, restaking provides a mechanism to achieve cold start security, ensuring decentralization from the outset. Protocols can also scale their security needs in response to network demands, offering a more cost-efficient alternative to building standalone security infrastructures [1].

However, restaking is not without its risks. The increased slashing conditions pose a threat to stakers who may lose a significant portion of their assets if they violate protocol terms. Additionally, there are concerns about the potential impact on the underlying Layer 1 blockchain. Vitalik Buterin has warned that overreliance on restaking could lead to conflicts around social consensus, especially in the event of a fork or re-org. Sreeram Kannan, founder of EigenLayer, has emphasized the importance of avoiding subjective slashing and ensuring that restaking protocols do not become complex financial primitives that could spiral out of control [1].

Several restaking protocols are leading the charge in this emerging space. EigenLayer is a pioneering restaking protocol on Ethereum, enabling users to stake their assets to secure various autonomous verified services (AVSs). As of the latest data, EigenLayer has over $6.8 billion in total value locked (TVL), with more than 4.6 million native and liquid staking tokens (LST) staked. Jito, operating on Solana, allows users to stake SOL and other derivatives to secure multiple networks and earn rewards through liquid restaking tokens [1].

Renzo Protocol is another notable player, offering strategy management for liquid restaking tokens. It simplifies the process for users by abstracting the complexities involved in selecting and managing restaking strategies across multiple protocols. Pendle Finance, meanwhile, is exploring innovative ways to manage yield from restaked assets by tokenizing future earnings, allowing users to trade and manage their yield components separately [1].

As restaking continues to evolve, it is reshaping the landscape of blockchain security and capital efficiency. While the technology offers compelling advantages, it also introduces new risks that require careful consideration. As more protocols emerge and existing ones expand their capabilities, users are encouraged to conduct thorough research before committing their assets to any restaking opportunity [1].

Source: [1] What Is Restaking in Crypto? A Beginner’s Guide (2025) (https://www.coingecko.com/learn/what-is-restaking-crypto)