Restaking means using ETH that is already staked on Ethereum as security for other services at the same time. The staker earns extra rewards and accepts extra penalties. The idea was introduced by EigenLayer and has since grown into its own sector of DeFi. Ethereum.org has a plain overview on its restaking page.
How Staking Works First
Ethereum has used proof of stake since September 2022. Validators lock up ETH and take part in proposing and attesting to blocks. Honest validators earn rewards. Validators that break the rules, for example by signing two conflicting blocks, lose part of their stake. This penalty is called slashing, and it is what makes the security credible: attacking the network costs real money. The basics are covered on the ethereum.org staking page.
Other systems need the same kind of security. Oracle networks, bridges and data availability layers all rely on a set of operators behaving honestly. Before restaking, each of them had to launch its own token and attract its own stakers, which is slow and often leaves the system weakly secured.
What Restaking Does
Restaking lets an Ethereum staker opt in to additional slashing rules set by another service. The staker's ETH now backs two things: Ethereum itself and the extra service. If the operator misbehaves on that service, the restaked ETH can be slashed there too.
In exchange, the service pays rewards. The service gets security backed by ETH without building a staking system from zero. The staker gets added yield and added risk.
EigenLayer's Role
EigenLayer is a set of smart contracts on Ethereum that coordinates this arrangement. It was developed by Eigen Labs, founded by Sreeram Kannan. Three groups take part:
- Restakers: deposit ETH or liquid staking tokens and delegate them to an operator.
- Operators: run the software for one or more services and carry the slashing risk on behalf of delegators.
- AVSs: the services that consume the security. AVS originally stood for Actively Validated Service. Each one defines its own tasks, rewards and slashing conditions.
The rollout came in stages. Deposits opened on Ethereum mainnet in June 2023 with caps. In April 2024, operators and the first AVS, a data availability service called EigenDA, went live. The EIGEN token followed later in 2024. Slashing was switched on in April 2025, which was the point at which the security model became enforceable. Before that, restakers earned rewards without being exposed to AVS penalties.
Slashing on EigenLayer is opt-in at the operator level. Operators choose which services they secure and how much stake they allocate to each, which is meant to limit how far a single failure can spread.
Liquid Restaking Tokens
Restaking directly requires choosing operators and managing positions. Liquid restaking protocols such as ether.fi, Renzo, Puffer and Kelp do this for the user. You deposit ETH or a liquid staking token, the protocol restakes it, and you receive a liquid restaking token (LRT) that represents your claim.
LRTs can be traded or used as collateral in other DeFi applications while the underlying ETH keeps earning. That stacking is the appeal and also the danger. An LRT holder depends on Ethereum's staking contracts, EigenLayer's contracts, the liquid restaking protocol and every application where the LRT is deposited.
LRTs do not always trade at the value of the ETH behind them. In April 2024, Renzo's ezETH fell well below its backing on decentralized exchanges for a short period, and traders using it as collateral with borrowed funds were liquidated.
Points and Airdrops
Much of the early growth in restaking came from points programs. Protocols awarded points to depositors, with the expectation that points would convert into tokens later. Deposits rose into the billions of dollars before most AVSs were paying any real rewards. Yield that comes from expected airdrops is not the same as yield paid by services for security, and it can vanish once a token launches.
Risks to Understand
- Slashing: stake can be penalized under the rules of each service the operator has opted into, not only Ethereum's rules.
- Smart contract risk: each layer adds code that can contain bugs.
- Operator risk: you depend on the operator you delegate to running software correctly.
- AVS quality: services differ widely in how well their slashing conditions are designed and audited.
- Withdrawal delay: leaving a restaked position involves a waiting period on top of Ethereum's own exit queue.
- LRT price risk: an LRT can trade below its backing when many holders want to exit at once.
- Systemic risk: if the same ETH secures many services, one large failure could affect a lot of stake together. Ethereum researchers, including Vitalik Buterin, have warned against relying on Ethereum's validator set to bail out failed services.
The Wider Ecosystem
EigenLayer is the largest restaking protocol but not the only one. Symbiotic and Karak offer restaking frameworks that accept a broader range of collateral, not only ETH. Similar designs exist on other chains, and projects such as Babylon apply the concept to Bitcoin.
Common Mistakes
- Treating restaking yield as free money on top of staking.
- Holding an LRT without knowing which operators and services sit behind it.
- Using LRTs as collateral for loans, where a brief drop in the LRT price can trigger liquidation.
- Assuming a quoted APR that depends on points or token incentives will last.
Nothing in this article is financial advice.
Key Restaking Facts
- Base asset: staked ETH or liquid staking tokens
- Main protocol: EigenLayer, by Eigen Labs
- First mainnet deposits: June 2023
- First AVS live: EigenDA, April 2024
- Slashing live on EigenLayer: April 2025
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The Ethereum price page shows the live ETH price, market cap and supply, and the EigenLayer price page does the same for EIGEN. To see pools where liquid staking and restaking tokens trade against ETH, check the DEX page.