What are the benefits that an AVS receives through LRTs?

AVSs & LRTs

The amusement park analogy has proven to be quite useful. 🎢

At an amusement park, there are rides, security inspectors and fun passes. 🎟️

• Rides are analogous to the different networks/protocols.

• Security inspectors are analogous to AVSs (Actively Validated Services).

• Fun passes are analogous to LRTs (Liquid Restaking Tokens).

The Formal Definition

In formal terms, AVS are blockchain applications that extend beyond EVM but use Ethereum’s extended validator set for validation semantics. Some examples include Data Availability Layers, Sidechains, New EVMs, and more.

Whereas, LRTs are the tokens that are provided after restaking ETH.

The Link 🔗

Is there a connection? 🤔

The AVSs need security through more & more investments. The method for investing in these AVSs is through LRTs.

Benefits to AVS through LRTs

1. Increased Security Stake & Decentralization

   • Due to LRTs, the yield increases for the stakers. Hence, there are more delegators for the network, resulting in higher Total Value Locked (TVL) and increased security for the network.

2. Higher Revenue Streams

   • Not only do stakers enjoy higher yields because of LRTs, but AVSs do as well. The transaction fees and other activities related to restaking tokens lead to increased revenue generation.

3. Broader Ecosystem Participation

   • LRTs enables AVSs to engage more deeply with the DeFi ecosystem, fostering partnerships and integrations that expand their service offerings and operational capabilities.

The Projects

Leveraging the benefits of the LRTs, some projects have turned good & big. Let’s have a quick look at them 👀:

1. AltLayer

   • Benefit: Scalability & Customization

   • Through highly customizable rollups AltLayer allows AVSs to scale transactions & operations without building extra heavy infrastructure. Life Saviour! 🫂

   • RollUps? 😬

     Layer-2 scaling solution, mainly for Ethereum. Transactions are processed off-chain in multiple batches and then submitted to the main-chain.

2. Blockless

   • Benefit: Decentralized Computing Power

   • Blockless offers decentralized computing power solutions, enabling AVSs to leverage distributed computational power for tasks requiring significant processing capabilities.

3. Celo

   • Benefit: Mobile-First Accessibility and Sustainability

   • It focuses on mobile accessibility and financial inclusivity, providing AVS with enhanced reach to mobile users and integrating sustainable practices into their operations.

4. Drosera

   • Benefit: Enhanced Security and Privacy

   • It emphasizes privacy and security features, which protect AVS from various cyber threats and ensure the confidentiality of sensitive operations and data.

5. Espresso

   • Benefit: Efficient Consensus Mechanisms

   • Espresso offers innovative consensus algorithms that improve transaction finality and throughput, enhancing the overall efficiency and speed of AVS.

6. EigenDA

   • Benefit: Data Availability Solutions

   • EigenDA specializes in data availability, ensuring that the data needed by AVS is readily accessible and that its integrity is maintained, which is crucial for reliable operation.

7. Hyperlane

   • Benefit: Interoperability

   • Hyperlane focuses on interoperability between different blockchains, enabling AVS to communicate and transact across various blockchain networks seamlessly.

8. Lagrange

   • Benefit: Mathematical Proofs and Verification

   • Lagrange offers advanced mathematical verification techniques, ensuring that the operations and transactions of AVS are mathematically sound and trustworthy.

9. Mantle

   • Benefit: Layer 2 Rollup Optimizations

   • Similar to AltLayer, Mantle enhances Layer 2 rollups, providing AVS with better scalability solutions by optimizing transaction throughput and reducing latency.

10. Omni

    • Benefit: Multi-Chain Integration

    • Omni supports multi-chain integration, allowing AVS to operate across multiple blockchain ecosystems, increasing their flexibility and utility.

11. Polyhedra

    • Benefit: Advanced Cryptographic Techniques

    • Polyhedra leverages advanced cryptographic methods to enhance the security and privacy of AVS, ensuring robust protection against sophisticated attacks.

12. WitnessChain

    • Benefit: Decentralized Oracle Solutions

    • WitnessChain provides decentralized oracle services, allowing AVS to securely and accurately obtain off-chain data, which is critical for smart contract execution and other functionalities.