Crypto fans really like to speculate, and currently EigenLayer seems to be one of the hot products in the market. Crypto Twitter is excited about this project, as users are increasingly staking ETH tokens on the platform. A keen look as to why people are getting excited about this project shows that many crypto investors are enthusiastic about the possible growth of its anticipated governance token.
Franklin Templeton took to Twitter to release his analysis on the growing uptake of ETH investors in the EigenLayer protocol. The report shows that average ETH deposits have been rather low since June 2023 until early this year, when larger amounts of ETH tokens started trickling into the protocol.
Templeton goes ahead and calls it the blackhole for Ethereum, potentially referring to the increased amounts of ETH being staked on the protocol.
What’s the unique selling point of the recently launched EigenLayer mainnet, you might ask?
Well, the protocol provides a unique approach to staking. Traditionally, crypto investors are used to staking their tokens on a particular protocol and earning yields on the staked token. However, with EigenLayer, crypto investors can stake ETH tokens on the protocol for an opportunity to re-stake their staked ETH tokens on other services.
Re-staking ETH tokens allows crypto investors to earn yields from both the Ethereum network and the blockchain network they choose to secure. This staking idea introduced by EigenLayer is relatively new, and many investors are excited about it because it offers potentially higher ROI.
EigenLayer Restaking Feature and its Influence on ETH Uptake.
EigenLayer implements a new approach to staking that allows users to secure multiple networks with the same ETH. This way, investors can earn staking rewards from different networks simultaneously.
Cryptocurrency investors are naturally speculative and exhibit a high-risk appetite. The new proposal promises higher staking returns, and many investors are looking to get a piece of that. Since the hype began early this year, average deposits of ETH on the EigenLayer protocol have been growing parabolically.
To put this into perspective, by June 2023, the protocol had approximately 8000 ETH tokens staked on the protocol. As of March this year, the number has significantly increased to approximately 1.2 million ETH.
What does this mean? Well, although the highest amount of staked ETH on the platform peaked in Feb 2024, the numbers have remained relatively steady, with over 1% of the total ETH supply staked on the EigenLayer platform.
Considering crypto investors are highly speculative, a good chunk of investors are also speculating about the increase in value of its governance token, which is expected to decentralize and secure the permissionless network.
Franklin Templeton Originally shared this Report on X