EigenLayer Now 2nd Largest DeFi Protocol But Restaking Tokens Pose Risks, Says Coinbase Report

• EigenLayer is now the second largest DeFi protocol with $12.4 billion in TVL, the report said.

• Restaking and liquid restaking tokens could pose additional risks compared to existing staking products.

• Restaking champions the open innovation of Ethereum and will become a core part of the ecosystem’s infrastructure, Coinbase said.

• The initial yield from actively validated services (AVSs) may not live up to the extremely high expectations set by the market.

• Stakers will go where the liquid restaking token (LRT) providers offer the highest rewards, which could lead to additional risks as LRT DAOs try to maximize rewards.