Sam is CoinDesk's deputy managing editor for tech and protocols. He reports on decentralized technology, infrastructure and governance. He owns ETH and BTC.
, but it had already become one of the network's biggest-ever protocols, with $12 billion worth of user deposits – a hot ticket partly because of its highly touted innovation of"restaking," a new technology that could usher in dramatic changes in the way crypto protocols bootstrap their security.
Sreeram Kannan, EigenLayer's founder and chief architect, acknowledged in an interview last week that the launch would move forward without some crucial functionality, instead proceeding under a"phased" rollout under an unspecified timeline. The benefit for EigenLayer investors – called"restakers" – is that they get an extra rate of return on top of the interest they already receive for staking ETH. The AVSs get the advantage of"pooled security."
Take, for example, the"slashing" feature that sits at the center of EigenLayer's security system. Slashing is integral to EigenLayer: It ensures that networks built on top of the protocol can penalize operators if they act dishonestly – by revoking all or a portion of their restaked deposits. Another yet-to-be-defined element of EigenLayer's programming is its"attributable security" system – a fallback mechanism that Kannan plans to use to protect against black swan events that threaten to wipe out the protocol's security apparatus. The feature exists to address the potential for contagion risk – the idea that a slashing event triggered by one AVS could hurt the security of every other AVS.
Then there's EigenLayer's fee system – the source of revenue it will use to reward interest to depositors, which is supposed to be the main incentive for restaking. In the near term, EigenDA will be operated by a community of validators, but those validators won't be at risk of slashing – this means they won't be financially incentivized to act honestly .
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