TL;DR
- The Eigen Foundation has committed 1% of its EIGEN token supply, approximately 16.8 million tokens, to the Ethereum Protocol Guild to support core developers.
- EigenLayer, a restaking protocol on Ethereum, allows staked assets to be repurposed, enhancing security and providing additional yield opportunities.
- Restaking protocols have around $26.9 billion in total value locked, with EigenLayer comprising the majority at $18.2 billion, highlighting its significant impact on the crypto market.
The Eigen Foundation has announced a significant commitment to the Ethereum ecosystem by allocating 1% of its EIGEN token supply to the Protocol Guild. This initiative aims to support the core developers responsible for maintaining the Ethereum layer-1 blockchain.
The Protocol Guild, which comprises 180 members from 29 teams, plays a crucial role in the ongoing development and sustainability of Ethereum’s infrastructure.
Today is the first time ever we get *two* projects to announce their @ProtocolGuild Pledge on the same day, with @alignedlayer committing 1.5% of their tokens to PG!
Thank you @eigenfoundation and @alignedlayer for your support ❤️🔥⛓️🛡️https://t.co/DaFhPMP8uw
— timbeiko.eth (@TimBeiko) December 12, 2024
Details of the Allocation
The commitment involves approximately 16.8 million EIGEN tokens, based on a total supply of 1.68 billion tokens, with around 210 million currently in circulation. The funds will be used to support the continued work of the Protocol Guild, ensuring that the core developers have the necessary resources to maintain and improve the Ethereum network.
This allocation reflects the Eigen Foundation’s dedication to fostering a robust and decentralized Ethereum ecosystem.
The Role of EigenLayer
EigenLayer, a restaking protocol on Ethereum, is at the heart of this initiative. The protocol allows staked Ether (stETH) and other assets to be repurposed and staked multiple times, providing additional yield opportunities for investors while enhancing the security of decentralized applications and blockchain protocols.
EigenLayer’s innovative approach has positioned it as a critical component of Ethereum’s infrastructure, drawing both praise and concern from the crypto community.
Impact on the Crypto Market
Restaking has been touted as a way to bring fresh capital injections into the crypto market and has the potential to create a new asset class. By allowing protocols to use restaked assets for network security, the burden of launching a token to secure the network is alleviated, significantly lowering the barrier to entry for developers and decentralized applications.
According to DefiLlama, restaking protocols currently have approximately $26.9 billion in total value locked (TVL), with EigenLayer comprising the majority at around $18.2 billion.
Future Prospects
The popularity of EigenLayer has propelled the EIGEN token into the spotlight, with the token entering the top 100 cryptocurrencies by market capitalization in October. Although it has since fallen to the 108th position, the protocol’s growth and recent expansion to include Wrapped Bitcoin products demonstrate its ongoing innovation and relevance in the crypto space.
