Re-staking platform EigenLayer “flips” Aave in TVL
The totality worthiness locked (TVL) of restaking protocol EigenLayer possesses outshined that of newfangled-made decentralized auto loan protocol Aave, rendering it the 2nd largest protocol via TVL.
This comes after EigenLayer’s determination to for a moment displace gob caps on its network.
At the time of designing, the TVL for EigenLayer rests at $11.24 billion, while the TVL for Aave is at $10.7 billion, according to information available on DeFiLlama.
The TVL “flip” possesses tempted in analysts that raise the misgiving about whether or not staking, or liquid staking, should be involved in a protocol’s TVL if staked native assets are predominantly not involved in the matter.
On a DeFi protocol assistance Aave, TVL includes the totality quantity of symbols deposited into a smart contract and also offered as collateral to obtain and also gain confer in. In this husk, derived coins are not involved in the TVL to inhibit blowing upwards the TVL.
Yet, on EigenLayer, subscribers can thieve part in pegging the network and also gain added inducements by gliding already native staked ETH or liquid staked ETH into the network’s smart agreements and also subjecting them to taking too lightly conditions.
Carlos Mercado, a documents researcher at Flipside, told Blockworks that TVL is gained to be an economic way to responses engagement. He tabs that it is inestimable to distinguish in between native assets such as ETH from faux iterations of unchanged asset, assistance wrapped ETH or staked ETH.
“If you don’t readjust for this, you avail into an predicament of blowing upwards the chain’s TVL, because unchanged token can be counted plenty of times over,” Mercado said.
This reasoning can furthermore be applied to protocol-particular TVLs, he said. Encompassing that EigenLayer itself is a restaking, significance that gliding stETH or cbETH can be recognized triple counting TVL.
Blockworks research expert Ren Yu Kong tabs that TVL possesses historically been offered as a metric to responses the totality quantity of assets in a smart contract.
“One can matter staking agreements via withdrawal credentials sharp towards EigenLayer’s agreements as a incarnation of smart agreements, and also at some point EigenLayer TVL would not surprisingly matter as TVL in the public sense,” Kong said.
