Ethereum-based staking protocol EigenLayer has seen its total volume locked (TVL) reach almost $6 billion after it temporarily lifted its deposit cap between Feb. 5 and today.
DeFiLlama data shows that the protocol currently has a TVL of $5.95 billion, almost three times higher than its TVL just five days ago.
This makes it one of the top 5 protocols in TVL rankings, ahead of popular decentralized exchange Uniswap and lending platforms Spark and Compound.
Of the deposits, major holdings included approximately 993,000 stETH, 209,000 swETH and 192,000 mETH, according to BlockIntel data, drawn from platforms Lido, Swell and Mantle, respectively. In dollar terms, those sums total roughly $3.5 billion alone.
EigenLayer itself does not have its own native token but relies on an open marketplace to secure its network.
In this open marketplace, validators can choose to opt into any Actively Validated Service (AVS) of their choice, locking their native staked ETH or liquid staked ETH into these smart contracts and subjecting them to its slashing conditions.
TVL caps were initially introduced to prevent one single token from dominating the blockchain and engaging in potentially harmful events.
Read More: EigenLayer deploys restaking protocol on Ethereum mainnet
The latest decision to remove TVL caps on liquid staked tokens (LTS) indicates that it is a positive time for the staking ecosystem, Amitej Gajjala, founding contributor at liquid restaking solution Kelp DAO, told Blockworks.
“It’s a step closer to leveling the playing field for all depositors and maintaining credible neutrality,” Gajjala said.
For liquid staking protocols, a higher TVL means more room for innovation and growth, while for LST restakers, this means accessing similar rewards as native restakers, even if it is just for a limited time, he said.
Gajjala added, “It’s a glimpse into what the EigenLayer mainnet launch can look like and the future interaction between restakers and AVSs.”
Updated Feb. 9, 2023 at 5:35 pm ET: This report has been updated to reflect the correct token amounts and their dollar amount conversions.
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Source: https://blockworks.co/news/eigenlayer-uncapped-deposits-closes-tvl