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EigenLayer launches $15.4B slashing testnet protocol

EigenLayer launches $15.4B slashing testnet protocol

GrafaGrafa2024/12/23 06:00
By:Mahathir Bayena

EigenLayer's (CRYPTO:EIGEN) slashing testnet went live on Dec. 20, marking a significant milestone for the restaking protocol, which has around $15.4 billion in total value locked (TVL).

The slashing upgrade, which is pending approval of the EigenLayer Improvement Protocol-002 (ELIP-002), aims to introduce Unique Stake Allocation for node operators and Operator Sets for Actively Validated Services (AVS).

EigenLayer allows AVS projects to secure offchain services using the Ethereum (CRYPTO:ETH) layer-1 network.

Restaked Ether (stETH) acts as collateral across blockchain ecosystems without needing to unstake the asset from Ethereum.

Unique Stake Allocation enables restaking operators to minimise slashing risks by assigning parts of their staked funds to specific AVS.

This “Unique Stake” can be slashed for errors, service failures, or dishonesty related to that AVS but not for unrelated tasks.

Operator Sets allow AVS to organise operators into groups, allocate tasks, and set slashing parameters.

Slashing penalties promote trust in blockchain ecosystems by penalising validators or operators for misconduct, ensuring onchain integrity.

EigenLayer's AVS community is expanding, with RedStone becoming the first major oracle provider to launch an AVS on the protocol.

Infura, a RPC node provider, also plans to join EigenLayer as part of its Decentralised Infrastructure Network (DIN), a decentralised marketplace for Web3 APIs.

In addition, EigenLayer is upgrading restaking rewards in January 2025, allowing AVS to distribute rewards based on performance.

The focus is on onboarding more AVS and consumer crypto applications, completing the protocol's four-part market, which includes node operators, AVS, asset restakers, and consumer applications.

At the time of reporting, the Eigenlayer (EIGEN) price was $3.79.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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