Ethereum’s community has been the house of many narratives all through the years, and liquid restaking is undoubtedly one to look into.
You is perhaps confused by the time period liquid restaking, and that’s fully comprehensible. In spite of everything, one other widespread narrative is centered round liquid staking.
Earlier than we dive into the intricacies of the Renzo Protocol, which is the final word function of this information, it’s important to know just a few basic rules first.
Let’s hold it easy. Each of those contain some kind of staking, which is the method of taking your tokens (we’ll use ETH for example all through your entire information) and locking them inside a protocol to serve a sure function. For this, you’ll obtain a reward (within the type of curiosity).
Liquid staking is a course of the place you stake your ETH in protocols, which in flip mint an artificial illustration of your ETH – that’s referred to as a liquid staking token (LST). The aim of your ETH, nevertheless, is at all times to extend the financial safety of Ethereum. It’s staked to validate and safe the Ethereum community. The time period “liquid†comes from the truth that the artificial asset that you just obtain can then be utilized in numerous DeFi initiatives that you just discover match.
The bottom protocol right here is Ethereum, and there are totally different LST protocols comparable to Rocket Pool, Lido, Binance ETH, Mantle ETH, and so forth.
With liquid restaking, the aim of your staked ETH is to extend the financial safety of exterior methods. These will be Oracle networks, Rollups, and whatnot. So, you’ll nonetheless stake your ETH inside a sure protocol, and you’ll as soon as once more obtain an artificial illustration of your tokens referred to as a liquid restaking token (LRT), however the function is totally different.
The bottom protocol right here is EigenLayer. Among the high LRT protocols embrace Renzo, Eigenpie, Kelp DAO, Puffer, ether.fi, and others.
Essential observe: each LSTs and LRTs are pegged to ETH in a 1:1 method, and you need to at all times be capable of redeem your artificial tokens for the ETH you’ve staked.
Right here’s a desk to visualise the above:
Now that you recognize what LRTs are, let’s rapidly clarify the position of EigenLayer in all this. That is vital for our information as a result of Renzo Protocol is actually a Liquid Restaking Token and a technique supervisor for EigenLayer. Don’t fear. It can make extra sense in a second.
EigenLayer is a protocol that’s constructed on Ethereum, and it was the primary to introduce restaking as a primitive. By that protocol, customers are capable of repurpose their ETH on the consensus layer. They’re now capable of opt-in to EigenLayer sensible contracts and restake their ETH to extend the crypto-economic safety of different functions on the community.
It’s basically a center layer the place customers conform to grant EigenLayer extra enforcement rights on their staked ETH. This then permits the protocol to restake the ETH on different functions.
These functions will be rollups, oracle chains, or just about any software that’s primarily based on comparable cryptoeconomic rules. They’re referred to as Actively Validated Providers (AVS). These are essential to know the aim of the Renzo Protocol.
In essence, an AVS is any system that has a requirement for distributed validation for verification. These will be sidechains, bridges, keeper networks, information availability layers, oracle networks, and so forth.
To place it in quite simple phrases, your staked ETH is being restaked to safe these AVSs. However since every AVS is totally different and it would include inherently variable threat profiles, the rewards are additionally totally different (you get rewards for staking and restaking, bear in mind?) So, which AVS must you direct your tokens to, and what’s the most effective technique?
That is the place the Renzo Protocol is available in.
Renzo is a platform that’s constructed on EigenLayer and principally serves as an interface to its ecosystem. It makes use of a mixture of operator nodes and sensible contracts to guarantee that its customers get the most effective threat/reward restaking technique.
We all know this may be fairly complicated, so let’s attempt to break it down even additional.
Now that you recognize what EigenLayer is and what LRTs are let’s try to simplify much more what Renzo does.
As we already defined, the AVSs in EigenLayer are any kind of decentralized service trying to inherit Ethereum’s safety. A restaking technique is, then, a place the place you (the consumer) determine to safe any of the numerous out there AVSs. It’s also possible to make all kinds of mixtures. The variety of attainable methods, nevertheless, will increase with the variety of out there AVSs.
This makes it exhausting to decide on the one which can convey the most effective threat/reward ratio. That is what Renzo does. It simplifies this course of and makes the selection for you, making certain the most effective R:R ratio.
ezETH is the Liquid Restaking Token (LRT) of the Renzo Protocol. It represents the consumer’s restaked place at Renzo.
Customers are capable of stake native ETH or liquid staking tokens (LSTs), comparable to wBETH and stETH, and obtain ezETH.
An vital issue right here is that ezETH is a reward-bearing token. As such, its worth can improve relative to the underlying tokens, because it yields extra rewards due to its utilization in AVSs.
Renzo has additionally built-in with Pendle Finance, the place a brand new token is created by means of a single contract – EIP5115 SY Token. It represents ezETH at a 1:1 ratio, however it may also be tokenized in principal tokens and yield tokens for individuals who need to do this.
Now that you’ve a basic understanding of how the Renzo protocol works, let’s learn the way to really use it in follow.
Step 1: You have to some ETH (or LSTs comparable to stETH) in your MetaMask pockets.
Step 2: Go to the Renzo Protocol restaking dashboard and join your pockets.
Step 3: It is possible for you to to decide on between the totally different ecosystems, in addition to between native ETH or every other LSTs which can be supported. These embrace wBETH (Binance Staked Ether) and stETH (Lido Staked Ether) for Ethereum.
Step 4: In our case, we’ll restake native ETH.
Step 5: Enter the quantity you want to stake and hit “Affirm.â€
Step 6: Affirm the transaction from the interface.
Step 7: Affirm the transaction out of your pockets.
Step 8: Head to the Portfolio tab the place you’ll be capable of view your earned factors and rewards.
And also you’re achieved!
Please observe that withdrawals are at present disabled. Customers will be capable of withdraw their deposited ETH following a so-called cooldown interval, to be decided by the staff. Nonetheless, ezETH is traded on secondary markets so you possibly can at all times swap it on DEXs.
Renzo’s factors (ezPoints) are designed to reward customers who actively take part and contribute to the success of the protocol. Each participant receives factors however their quantity varies primarily based on the length and the character of this participation.
Holding ezETH, as an example, rewards ezPoints. Each ezETH holder receives 1 Renzo ezPoint per hour per 1 ezETH. Early participation can be rewarded, whereas customers who maintain extra ezETH obtain extra factors, primarily based on totally different boosts comparable to these:
ezPoints decide the variety of REZ tokens a consumer will obtain following the token technology occasion, which brings us to the subsequent level.
Crucial to Renzo’s dedication to decentralization is the REZ token – a cryptocurrency that’s designed to energy the governance of the protocol.
REZ is the native governance token for the protocol. Holders of REZ will be capable of vote on governance proposals concerning numerous issues, together with however not restricted to:
The whole provide of REZ tokens is capped at 10,000,000,000.
The preliminary circulating provide (itemizing on April thirtieth) will likely be 1,150,000,000.
You could find the contract right here.
Fundraising: 31.56%
Neighborhood: 32%
Core Contributors: 20%
Basis: 12.44%
Binance Launchpool: 2.5%
Liquidity: 1.5%
The token launch schedule appears like this:
The REZ airdrop has been a much-anticipated occasion for neighborhood members who’ve been farming ezPoints since their announcement.
As said above, 7% of the full provide will likely be distributed for Season 1 airdrop rewards primarily based on the consumer’s earned ezPoints.
Listed here are the airdrop eligibility standards:
The snapshot date is April twenty sixth, 2024, whereas the declare date will likely be on April thirtieth. The declare window will open an hour earlier than the itemizing on Binance, which is at 12:00 (UTC).
There can even be a Season 2 with undisclosed dates for now. It can obtain 5% of the full provide.
Lucas Kozinski is a part of the founding staff at Renzo Protocol. He comes with wealthy background within the crypto business, having beforehand labored at lending and borrowing app Moonwell, TokenSoft, and the Tezos Basis.
James Coole is one other founding contributor at Renzo. He had beforehand co-founded TokenSoft, the place he served because the Chief Expertise Officer for 5 years.
Kratik Lodha can be listed as one of many founding contributors. His background consists of a number of analytic positions in numerous funds such because the Woodstock Funds, WorldQuant, Fairness Analysis, and others.
In January 2024, Renzo disclosed a $3.2 million seed spherical led by Maven11. Different individuals included IOSG Ventures, Figment Capital, SevenX Ventures, and extra.
In line with its official web site, traders additionally embrace Binance Labs, OKX Ventures, Mantle, Edessa Capital, BODHI Ventures, Robotic Ventures, Re7Capital, and others.
The Binance Launchpool marketing campaign will final till April thirtieth. Buying and selling will begin at 12:00 (UTC).
To take part, you’ll need a Binance account. When you don’t have one, you possibly can create it utilizing this hyperlink. Additionally, you will want to finish your KYC verification. The entire course of takes no quite a lot of minutes.
Step 1: Finding the Launchpool Part
After getting your account ready, you’ll need to navigate to the Launchpad & Launchpool part from the highest navigation menu (should you’re on Desktop).
Step 2: Choosing a Pool
As soon as there, the Renzo launchpool will seem as the newest one, and you’ll have to select which pool you need to be a part of. For REZ, there are two swimming pools:
For the sake of this information, we’ll select the FDUSD Pool. You’ll be staking FDUSD to obtain rewards in REZ.
Click on on “Stake.â€
Step 3: Staking the Chosen Cryptocurrency
You’ll be taken to a brand new window, the place it is possible for you to to observe all the data for the pool you’ve chosen. This contains whole pool rewards, most hourly rewards, how many individuals take part, how a lot is staked, and so forth. Right here, additionally, you will be capable of observe your rewards and declare as soon as the claiming window opens.
You’ll as soon as once more should click on on “Stake.â€
After that, all it’s essential do is enter the quantity you want to stake and, you guessed it, click on “Stake†once more.
Step 4: Declare Your Rewards When Attainable
Rewards are calculated hourly, so as soon as sufficient time has handed, you will note the claimable quantity seem beneath the “My Rewards†tab on the web page. You may declare them, however you’ll solely be capable of commerce REZ as soon as the itemizing takes place on April thirtieth.
Renzo Protocol has managed to draw loads of consideration by means of its appreciable progress in a comparatively brief time frame. The liquid restaking narrative can be one of many extra fascinating developments in 2024, with EigenLayer booming in each utilization and recognition.
The protocol gives an easy-to-use approach to earn a yield on in any other case dormant tokens, however there are additionally sure dangers concerned.
Whereas Renzo does what it will possibly to make sure safety, it’s additionally extremely advisable for each consumer to do intensive analysis, assess their threat profile, and—if wanted—even seek the advice of with an expert earlier than making any monetary choices.
The above put up is powered by Renzo Protocol.
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