EigenLayer Token Airdrop: Is It Happening?

The crypto industry has seen incredibly lucrative airdrops in the past six months, from Celestia’s TIA to Solana’s PYTH and JITO tokens.

The crypto community is now speculating about the possibility of an EigenLayer token airdrop.

Although EigenLayer has denied and warned against false airdrop rumors, airdrop hunters remain undeterred and are actively using the protocol’s services to increase their chances of becoming “eligible” for potential airdrops.

But what is EigenLayer? What are people doing to increase their chances of getting airdrops? Will there even be an EigenLayer airdrop? Let’s find out.

Key Takeaways

  • EigenLayer is a protocol built on Ethereum that allows users to stake their liquid staking tokens.
  • The team has not made any official announcement about airdrop plans.
  • An EigenLayer token airdrop is purely speculation as of 31 January 2024.
  • Airdrop hopefuls believe restaked points will be used as eligibility criteria for future token airdrops.
  • Liquid restaking tokens (LRT) have emerged that give holders exposure to restaked points.

What is EigenLayer?

EigenLayer is a protocol built on Ethereum that allows users to stake their liquid staking tokens (LST).

Users who stake their Ether (ETH) tokens on staking platforms like Lido, RocketPool, and Coinbase Earn receive LSTs, which act as receipt tokens. EigenLayer is a restaking protocol that allows users to stake LSTs, which is used to extend crypto-economic security to rollups and decentralized applications (Dapps) secured by EigenLayer.

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Anyone building a new rollup or DApp can simply tap into the pooled security provided by EigenLayer instead of bootstrapping a new trust network of validators to secure their system. The restaked cryptocurrencies act as collateral that ensures operators on EigenLayer act honestly or risk a slashing of their collateral.

Operators are actors within the network who are responsible for validating rollups and DApps. An operator can support any number of applications that use the pool security.

Supporting more applications can potentially increase an operator’s restaking rewards. However, operators must be aware of custom slashing conditions set by these applications.

Stakers can choose which operator to delegate their staked cryptocurrencies to. Stakers need to be aware of the risk of losing their deposits in the event of slashing, which can occur if their operator behaves maliciously or is absent from making their services available.

Will There Be an EigenLayer Airdrop?

EigenLayer has not made any announcements regarding an token airdrop. On 12 October 2023, EigenLayer warned its followers on X to be aware of “deceptive links” and said: “There is NO AIRDROP.”

Despite the denials, EigenLayer’s Discord channel keeps attracting new followers every day, many of whom come with the primary inquiry of “airdrop wen?” only to be disappointed with negative replies from channel moderators.

Many airdrop hopefuls point to Ethereum Layer 2 network Arbitrum’s sudden ARB token airdrop in March 2023, which came despite Arbitrum’s development team previously denying plans to issue native tokens.

What are they doing to prepare for a potential EigenLayer token airdrop? Let’s find out below.

How Do You Become Eligible for an EigenLayer Token Airdrop?

Crypto projects tend to reward early adopters and users with a small allocation of token airdrop. Airdrop hopefuls are betting the project will use “restaked points” as its main eligibility criteria.

Stakers receive points called “restaked points” as a measure of their contribution to the shared security of the EigenLayer ecosystem.

Restaked points received by stakers depend on the amount of tokens restaked and the amount of time the tokens are restaked. For example, a user who stakes one rETH for five days will receive 1 ETH x 5 days x 24 hours/day = 120 restaked points.

We saw a similar scenario play out with AltLayer airdrop in late January 2024.

AltLayer is a rollup launchpad that uses the restaking mechanism to secure its rollups.

When AltLayer announced plans for the ALT token airdrop on Twitter, the project set aside 13.05% of the first ALT airdrop supply for restakers, with restaked points equal to and over 720 points.

How to Accumulate Restaked Points?

Restaking on EigenLayer

You can gain restaked points by restaking your LSTs.

As of 31 January 2024, the LSTs eligible for restaking on EigenLayer were:

  1. Lido staked ether (stETH)
  2. Binance staked ether (wBETH)
  3. Coinbase staked ether (cbETH)
  4. StakeWise staked ether (osETH)
  5. Ankr staked ether (ankrETH)
  6. Stader Staked ether (ETHx)
  7. Swell staked ether (swETH)
  8. Origin staked ether (oETH)
  9. Rocket Pool ether (rETH)

At the time of writing, EigenLayer has paused restaking after reaching capacity.

EigenLayer will unpause its restaking window between 5 February 2024 and 9 February 2024.

Three new LSTs – Mantle staked ether (mETH), Frax ether (sfrxETH), and Liquid staked ether ($LsETH) – will be eligible for restaking from 5 February onwards.

Liquid Restaking Tokens

Users can also get exposure to restaked points through liquid restaking tokens (LRT). These tokens help users sidestep EigenLayer’s restaking caps.

LRTs are exactly like LSTs. LSTs represent staked ETH, while LRTs represent staked LSTs. LRTs unlock the liquidity of the otherwise-locked LST tokens in the same way that LSTs unlock the liquidity of staked ETH tokens.

It’s like the movie ‘Inception”, except with ETH, staked ETH, and staked-staked-ETH.

Here are a few examples:

  1. Ether.fiEther.fi allows users to stake their ETH to get a token called eETH. Ether.fi restakes ETH on EigenLayer on the holder’s behalf, accruing restaking points for eETH holders.
  2. Swell Swell is a platform that issues tokens called restaked Swell ether (rswETH) representing ETH restaked on EigenLayer. rswETH earns restaked points for its holders while remaining liquid and tradeable.
  3. Kelp DAOKelp DAO issues rsETH tokens when users stake LSTs on its platform.

The Bottom Line

The most important piece of information that readers should take from this article is that an EigenLayer token airdrop has not been officially confirmed as of 31 January 2024.

Always do your research before investing in cryptocurrencies or pursuing token airdrops. If you want to accumulate restaked points, keep in mind that market volatility can affect ETH, LST, and LRT prices.

FAQs

What is EigenLayer?

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Mensholong Lepcha

Mensholong Lepcha is a financial journalist specializing in cryptocurrencies and global equity markets. He has worked for reputed firms such as Reuters and Capital.com. Fascinated with blockchain technology, NFTs, and the contrarian school of investing, Mensholong has expertise in analyzing tokenomics, price movement, and technical details of Bitcoin, Ethereum, and other blockchain networks. He has also written articles on a wide range of financial topics including commodities, forex, central bank monetary policies, and other economic news.