Author: Jack Inabinet, Bankless; Translation: Deng Tong, Jingse Caijing

In early 2024, Airdrop Hunter sought to profit from a simple EigenLayer deposit task, and then staked it to become popular. However, shortly after EigenLayer's first drop in April, the metadata stagnated and TVL has not been able to increase since then - down 8% in ETH terms.

Since the re-staking service has not yet been launched, deposits continue to be incentivized by the promise of future airdrops. But this pattern will change the moment the Active Verification Service (AVS) that utilizes re-staking security goes online, activating them will bring actual returns to depositors and demonstrate the demand for re-staking.

Today, we will explore the top 5 AVS in EigenLayer re-staking capital ranking to understand how much revenue they are expected to generate.

EigenDA

ETH re-staking: 3.64 million (9.8 billion USD)

EIGEN re-staking: 71.4 million (estimated 0.247 billion USD)

More than 10 billion USD worth of cryptocurrencies have been re-staked to ensure EigenDA (assuming a pre-launch price of 3.46 USD for EIGEN at the time of writing), making it the largest TVL AVS.

EigenDA is the flagship application of EigenLayer, currently being developed to verify the concept of re-staking; it is a data availability network that will allow L2 to store historical transaction data using re-staking operators instead of Ethereum, thus saving Rollup costs.

Data availability competitor Celestia shocked cryptocurrency investors in February of this year with a fully diluted valuation of $20 billion. However, since the mainnet launch in October 2023, the protocol has only received data availability payments of approximately 3.5k TIA (estimated at $20,000), making it difficult to imagine how EigenDA can generate significant returns for its re-staked capital of over $10 billion.

eOracle

ETH re-staking: 2.91 million ($7.8 billion)

EIGEN re-staking: N/A

Oracles are an important part of blockchain infrastructure, allowing developers to integrate real-world information into smart contracts, enhancing on-chain programmability. One of the most common oracle applications is in lending markets, where price information from centralized exchanges is extracted and used for automated on-chain liquidation.

eOracle utilizes re-staking to improve the capital efficiency of oracle operations and create a competitive oracle market where anyone can independently provide or use data.

Chainlink, a competitive oracle network, derives 98% of its revenue from price information. Although this project has experienced significant decreases since June, it generated $36.7 million in revenue from price information in the first six months of 2024. This corresponds to an annualized return on investment (ROI) for eOracle re-stakers slightly below 1%. It is unlikely that eOracle will be able to capture the entire market share of Chainlink.

Witness Chain

ETH Re-stake: 2.6 million (7 billion USD)

EIGEN re-staking: N/A

Witness Chain positions itself as a "DePIN coordinated EigenLayer AVS." This system enables the off-chain DePIN network to transform its physical properties (i.e., location and computing power) into verifiable on-chain evidence.

By maintaining a physical information repository, Witness Chain aims to enable the interconnection of DePIN projects, creating an "end-to-end supply chain for decentralized infrastructure."

While the potential revenue for transforming the network for sharing decentralized infrastructure is significant, the adoption rate in the broader decentralized infrastructure field is limited compared to centralized alternatives. As DePIN is still largely in the conceptual validation stage, the potential earnings that Witness Chain can generate remain a mystery.

Hyperlane AVS

ETH Re-stake: 2.32 million (6.3 billion USD)

EIGEN re-staking: N/A

Hyperlane is an permissionless interoperability layer or bridge that allows smart contracts to transfer arbitrary information between different blockchains. The protocol is currently deployed on over 35 chains, including EVM, Cosmos, and Sealevel.

Developers can customize the security of Hyperlane to meet their specific needs by selecting validator sets, setting rate limits, and using the programmable inter-chain security module (ISM) to adjust staking to protect their applications.

Since the beginning of the year, Across Network has generated $5.43 million in fees from its bridging service; considering the current amount of ETH restaked, this equates to an annualized return of 0.1% for Hyperlane AVS restakers.

Lagrange ZK Prover Network

ETH re-staking: 2.27 million (6.1 billion USD)

EIGEN re-staking: N/A

Lagrange ZK Prover Network generates ZK proofs from any blockchain dataset and uses a decentralized 'gateway' node network to store packets, which these nodes transmit to the prover to convert it to readable data. The network can handle smart contract information from any EVM-based chain and answer queries about contracts on another chain, without the need for third-party bridging solutions.

When combined with the Lagrange governance committee (an independent EigenLayer AVS secured by 2.02 million ETH ($5.5 billion) in re-collateralization), Lagrange can provide fast confirmation for optimistic rollups, allowing them to bypass the standard 7-day fraud challenge period during normal operation and eliminate cross-chain bridging delays.

If Lagrange becomes the de facto interchain communication standard in future multichain ecosystems, its enormous utility could bring astronomical profits to re-collateralizers. However, the protocol must first be adopted and will have to compete with existing bridging solutions and upcoming alternatives like Polygon AggLayer to achieve this goal.

The sustainability of re-collateralization.

Re-collateralization is not just about the profit potential of any one platform. In order for EigenLayer to succeed, its underlying AVS also needs to be highly successful.

While the expected revenue from AVS alone may not seem sufficient to meet existing deposits, optional pooling of re-collateralization allows operators to obtain multiple AVS with the same capital, which is a cornerstone feature of EigenLayer and will create unprecedented capital efficiency in crypto-economic security.

In addition to this actual income, depositors of re-collateralization will receive native tokens as compensation, although the value of these inflationary incentives and the broader EigenLayer ecosystem will once again depend entirely on the long-term adoption of underlying AVS.

We are still in the early stages of re-collateralization, and while competing services like Symbiotic are attracting deposits to vie for dominance in re-collateralization, there are still many questions about the long-term sustainability of the industry and its current incumbents.