Cryptocurrencies
Ether Restaking May Morph Into ‘Internet Bond’ Market, S&P Says
- Restaking is similar to securities lending in fixed income
- EigenLayer protocol has about $19 billion in restaked Ether
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The emergence of restaking services on the Ethereum blockchain, where investors can earn additional yield on their cryptocurrency, could lead to an “internet bond” market, according to S&P Global Ratings.
Holders of Ether earn a yield by pledging, or staking, their tokens to be used to help verify transactions on the network, similar to in the bond world, where investors earn a baseline rate by lending their funds to a borrower. In restaking, rewards are compounded by reinvesting them into other protocols, akin to lending out securities in the fixed-income markets.