Ethereum

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Stader

Coinbase Wrapped Staked ETH

Stader Labs has introduced a new Liquid Restaked Token (rsETH) on testnet that allows users to stake the same ETH on multiple networks simultaneously. 
The recently <a href="https://www.staderlabs.com/blogs/understanding-rseth-tech-explainer/" target="_blank" rel="noopener noreferrer nofollow">launched</a> rsETH token builds on EigenLayer’s restaking protocol and is designed to boost staking rewards by leveraging liquid staking tokens like Lido’s stETH and Coinbase Wrapped Staked ETH (cbETH). 
Restaking enables users to earn staking rewards on ETH while retaining liquidity. During a recent <a href="https://www.theblock.co/post/252310/stader-labs-liquid-restaked-token-ether?utm_source=onecryptofeed&amp;utm_medium=social" target="_blank" rel="noopener noreferrer nofollow">interview</a> with The Block, Stader Labs co-founder Dheeraj Borra explained the benefit of such a system. 
<blockquote class="wp-block-quote"> 
 rsETH is more than just a token; it is an entry point to more rewards and opportunities in the crypto landscape, allowing users to aggregate rewards from various different sources to maximize their holdings <cite>Stader Labs co-founder Dheeraj Borra</cite> 
</blockquote> 
 You might also like: <a href="https://crypto.news/learn/how-does-ethereum-staking-work/" rel="noopener noreferrer nofollow"> How Does Ethereum Staking Work? A Beginner’s Guide </a> 
The rsETH token works by letting users deposit liquid staked ETH tokens and mint rsETH representing fractional ownership. These assets are distributed to node operators within Stader’s network to earn a share of staking rewards. 
Holders can trade rsETH on decentralized exchanges (DEXs), use it in decentralized finance (DeFi) protocols, and redeem the underlying assets anytime. The token is currently live on Ethereum testnet with launch on mainnet to be announced soon, according to statements shared with The Block. 
The platform already supports liquid staking on Ethereum, Polygon, BNB Chain, Near, Fantom and Hedera with $124 million total value locked. The rsETH launch aims to simplify access to restaking rewards but could raise concerns about re-staking the same ETH multiple times, an issue highlighted by Ethereum’s co-founder Vitalik Buterin in a late May blog <a href="https://vitalik.ca/general/2023/05/21/dont_overload.html" target="_blank" rel="noopener noreferrer nofollow">post</a>. 
In his post, Buterin argues that “re-staking” techniques used by protocols like EigenLayer to allow Ethereum validators to simultaneously stake on other networks brings systemic risks. The main concern is overloading Ethereum’s social consensus and essentially “recruiting” it to serve other protocols’ purposes beyond just validating Ethereum transactions. 
For example, some restaking designs rely on the threat of Ethereum forking away malicious validators who misbehave on the other network. This stretches Ethereum consensus into policing activities on entirely different blockchains. 
Buterin warns this has no limiting principle and risks pulling Ethereum into “uncomfortable choices” as its community gets pressured to make more judgement calls on behalf of other networks. He argues this could fracture Ethereum’s social cohesion over time as it takes on more “mandates.” It also creates perverse incentives for large projects to become “too big to fail” and demand preferential treatment in case of failures. 
Instead, Buterin advocates that restaking designs should avoid creating expectations that Ethereum consensus will intervene to solve problems. Validators should only be accountable according to the specific protocol’s rules, not rely on Ethereum slashing or forking. 
This keeps Ethereum focused purely on its own protocol rules and avoids over-burdening its community with responsibilities spanning multiple blockchains. While dual staking itself has risks, stretching social consensus is seen as a threat. 
 Read more: <a href="https://crypto.news/staking-rewards-are-now-taxable-says-irs/" rel="noopener noreferrer nofollow"> Staking rewards are now taxable, says IRS </a>

New ‘Liquid restaked token’ tests staking same ETH multiple times

crypto.news

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