EigenLayer hits nearly $6 billion TVL as its uncapped deposits window draws to a close

Restaking protocol EigenLayer has seen its TVL surge to nearly $6 billion over the past few days following the temporary lifting of its deposit caps.

Assets deposited to EigenLayer have risen around 170% from $2.15 billion when the window began on Feb. 5 to reach $5.9 billion at the time of writing — some 2.3 million ether — according to DeFiLlama data.

To put that in perspective, the TVL is equivalent to about 2% of ether’s total circulating supply, according to The Block’s price page. It also places EigenLayer among the top five DeFi protocols by TVL, ahead of leading decentralized exchange Uniswap and behind only Lido, Maker, Aave and JustLend.

EigenLayer went through a series of deposit cap increases ahead of temporarily lifting the latest cap of 200,000 ether ($500 million) for each liquid staking token. The removal of EigenLayer’s TVL caps comes to a close at 3 p.m. ET today. However, the project said it ultimately plans to lift caps permanently, enabling a “permissionless, neutral environment while promoting decentralization.”

EigenLayer previously said the temporary removal of the caps was designed to boost organic demand. However, many users have been incentivized to deposit funds and participate in the network to earn reward points — with stakers speculating they may potentially receive Eigen token airdrop rewards in the future.

What is EigenLayer?

EigenLayer’s protocol allows users to deposit and re-stake ether via liquid staking tokens, allocating those funds to secure third-party networks and potentially earn additional rewards. Liquid staking solutions enable users to participate in Ethereum ETH -1.47% staking while unlocking the value of the underlying assets as a liquid staking token for use as collateral in DeFi.

The initial phase of Eigenayer’s protocol was rolled out on the Ethereum mainnet in June 2023, allowing users to deposit LSTs from three staking projects: Lido, Rocket Pool and Coinbase. The protocol has since expanded to additional LSTs, including Stakewise’s sETH, Mantle’s mETH, Frax’s sfrxETH, Ankr’s ankrETH and Binance’s wBETH.

EigenLabs — the team behind EigenLayer — closed a $50 million Series A funding round led by Blockchain Capital in March 2023. Last month, EigenLayer announced plans to adopt a shared security model — enabling protocols to join the network by leveraging a collective pool of re-staked ether. The project aims to become a major decentralized application platform and enable other projects to launch, leveraging the so-called shared security model.

Yesterday, the percentage of ether supply staked on the Ethereum network reached 25% for the first time.

The Block reached out to EigenLayer for comment.