TLDR:
- The prominent crypto exchange Kraken has begun offering Ethereum restaking through EigenLayer for clients not based in the United States.
- By restaking, investors can harvest additional earnings on ETH they've previously committed to stake.
- Staked, a Kraken subsidiary, will handle validation for Ethereum that is restaked through the platform.
- This year has seen a phenomenal surge, over three thousand percent, in the total value secured in liquid restaking tokens.
- EigenLayer has recently seen its EIGEN tokens become tradeable, boasting a staggering valuation of $6.7 billion.
Kraken, known for its leadership in the cryptocurrency industry, has formally rolled out Ethereum restaking, taking advantage of the EigenLayer infrastructure. for its non-U.S. customers.
The novel feature enables users to gather extra rewards on their staked Ethereum, all while enhancing the security of decentralized apps (dApps) on the EigenLayer network.
Restaking functions by extending the potential of staked assets, allowing them to safeguard multiple protocols without requiring removal from the initial blockchain. This strategy not only boosts potential earnings for investors but also fortifies the wider crypto ecosystem.
Kraken's decision to incorporate restaking comes amidst a rapid expansion in this area. Data from DefiLlama shows a significant leap—over 3000%—in the total value locked in liquid restaking tokens, now standing at roughly $11 billion. This dramatic growth underscores the burgeoning interest among crypto investors.
The aim of Kraken's new restaking service is to streamline the experience, broadening access to it for a larger audience. Mark Greenberg, the Global Head of Asset Growth at Kraken, remarked that this initiative \"substantially lowers\" the entry barrier, leveraging the general familiarity users have with centralized exchanges.
Kraken has teamed up with its unit, Staked, to bring this offering to life, with Staked acting as the validator for ETH restaked. Known for catering to institutions, Staked's expertise in EigenLayer further strengthens Kraken's position.
Participants engaging in restaking via Kraken can opt to keep their gains on the platform or convert them into traditional currency or various cryptos. This flexibility empowers them to manage their profits effectively.
While this restaking option is widely available in several European regions, U.S. customers and some other areas face \"geographical restrictions,\" as noted by Kraken.
Kraken's Ethereum restaking debut aligns with recent shifts within the EigenLayer landscape. The protocol’s native token, EIGEN, was recently enabled for market activity, roughly five months after some early adopters received their airdrop.
The Eigen Foundation disclosed plans to release the token on September 30, 2024, with major exchanges like Binance making it tradable, offering pairs with cryptocurrencies such as Bitcoin and Tether.
Kraken's restaking mechanism makes use of staked ETH to help secure decentralized platforms tagged as Actively Validated Services (AVSs).
By offering protection to these dApps, participants can reap additional rewards beyond their basic ETH staking incentives. These returns are given in AVS tokens, symbolizing the dApps secured by restaked ETH.
There are some factors to consider with restaking. EigenLayer has a minimum holding period of seven days, in addition to the unbonding timeframe needed to unstake from Ethereum. Thus, accessing restaked ETH might take more time than standard Ethereum staking.
Engaging in EigenLayer restaking through Kraken requires users to have a verified Kraken Pro account of at least Intermediate standing, ETH in their balance, and residency outside banned areas. such as the United States.
