EIGENLAYER

About EigenLayer

EigenLayer is a restaking protocol built on Ethereum that introduced a new cryptoeconomic primitive allowing staked ETH to be reused to secure additional decentralised services simultaneously. Ethereum validators who have staked ETH can opt into EigenLayer smart contracts and extend their cryptoeconomic security to third-party protocols called Actively Validated Services (AVS), earning additional yield in return.

Founded by Sreeram Kannan, a professor at the University of Washington, EigenLayer attracted $15 to $20 billion in total value locked at its peak in 2024, making it the largest DeFi protocol by TVL outside of Lido and Ethereum itself. The EIGEN token is described as a Universal Intersubjective Work Token, not a standard governance token, but a mechanism for resolving faults in decentralised tasks that cannot be proven on-chain but are observable by external consensus.

EigenLayer's distribution is heavily insider-weighted, which was a core source of controversy at launch. Investors take the largest share at 29.5% and early contributors hold 25.5%, both on a three-year vesting schedule with a one-year cliff, meaning the full unlocking pressure builds significantly from October 2025 onward. The community-facing allocations collectively total 45%, split evenly across three buckets: Stakedrops for the multi-season airdrop program, R&D and Ecosystem development, and Future Community Initiatives. Each receives exactly 15%. In practice however, only 6.75% of total supply was distributed in Seasons 1 and 2, leaving the vast majority of the community allocation yet to be deployed. The token has infinite supply, meaning ongoing emissions will continue to dilute holders over time. For a protocol that attracted $20 billion in TVL from the community, the 55% insider allocation drew significant criticism as disproportionate to what users received in return.