Restaking Realities: Risks, Rewards, and the Road Ahead - TOKEN2049 Singapore 2024

all right everyone welcome to the reaking panel we'll be talking about a lot of fun things today again risks rewards and the road ahead my name is Ben Rodriguez and I'm a senior protocol specialist at coinbase I cover multiple ecosystems and different Primitives including reaking all right so um let my panelists introduce themselves why don't we start with you I'm Lucas Brer co-founder and CEO jto labs and a contributor to the jeto network jeto Builds Me infrastructure and liquid staking and reaking on salana sweet thank you vas uh I'm Vias uh one of the founding members of igen layer now over at the igen foundation primarily focused on um growth ecosystem token governance Etc Misha hey my name is Misha I'm co-founder symbiotic uh shared security protocol that aims to uh democratize decentralization optimize it and make it available day one for every Network yeah awesome so as you all know reaking has exploded in the past 18 months right so I think maybe the first question that we can discuss is you know um what's the goal of reaking and re-shared security right what value does it bring to the ecosystems okay anybody can start yeah uh the the the goal is simple uh we want to U take the Journey of decentralization and make it shorter safer and cheaper uh we want to remove this barrier that takes like six to 16 months currently uh and uh basically creates an incentive to launch centralized or launch like with proof of Authority or other um like suboptimal solution and dangerous Solutions and uh to make it that attractive that that networks launch decentralized from the start yeah um I think it's about uh enabling projects to bootstrap themselves much faster in a much more safer stable manner like uh Misha just said I think we observed a lot of you know projects that had their own Security in their own token in their own native asset and when you needed security the most is when it would fail you because you know you would end up in the death spiral during moments of vulnerability so it's really about um reaking as a mechanism to you know establish the infrastructure for projects to be able to come into the space and innovate and focus on what they're doing best which is you know often some specific technical or you know business logic or component and not focus on all the other attributes that are involved with launching a token yeah not much to add there I think um you know you it it provides a method for projects that maybe are more decentralized or centralized to decentralize faster and uh I do think there's there's a lot of projects that have their own tokens and I think uh by taking some of these already staked assets like eth or solar whatever it is and uh adding it to the uh Network you can create more secure services and uh decentralized protocols yeah so we let's go into the many different actors in this space we have like The Operators right we have the protocols that are being built on top of it the stakers SL rakers right so the thing that I want to try to get into is the real value of the protocols being built on top of it because like we're trying to say that like resters are going to earn more yield and stuff like that right so these protocols or avss however you want to call it will need to bring some value so let's talk a little bit about you know what kind of value is being brought in anybody want to sh yeah well some protocols and some networks they it's almost impossible for them to launch without RIS taking uh so like I'll start with that so like pre pre-confirmation say if your if your commitment uh and like slash part needs to be like two ethereum per one proposer it's like billions of dollars that your protocol needs and with raken can get optimized to almost nothing uh this is like the the Corner case of it other cases are on a spectrum like some of them really benefit from Capital efficiency because they need like the risks are huge and the actual uh like uh the the fees are really minimal uh and yeah some protocols will not benefit from it at all so it's not like one siiz fol fol but if you understand is staking as like in a lot of ways it's insurance like you insurance companies would not exist if they have to have a deposit for every human that they Ure uh for protocols like it doesn't make any sense like for you to hold all this stake if it can be used somewhere else mhm so yeah look at it as insurance it's a capital efficiency that can be like ecosystem building um yeah I would uh I agree with everything Misha just said I would say um it's about creating a platform for these protocols to essentially come up with what I look at as almost like decentralized SAS Services these are all like different modules that fit into like a far more elastic a far more like rapid rate of innovation and the reality is we are you know the predominant majority of these protocols and services that we're working with is um infrastructure heavy and they're the projects that need this Economic Security the most um but you know as we move further and further into the ecosystem we start looking at um what is the dent in the total addressable Market that we can have and that goes Downstream to these infrastructure providers to the projects building on top of them and try trying to make sure that they're actively um you know making an impact on on boarding the next generation of onchain users with actual you know consumer adoption which I still think we're you know a bit early in the cycle for that but yeah I I think it's really important for us to you know eventually get to a future where most of the infrastructure is abstracted away from the consumers and users are you know interacting with crypto applications um purely as the backend rails and you know you don't really pay attention to which SAS modules are integrated into your web 2 application when you're using you know normal consumer applications and eventually we're going to see a very similar Paradigm in crypto applications as well yeah awesome Lucas you have anything to add there the the thing that I look for a lot is uh protocols with actual users or uh um reaking is it's going to be nothing without protocols that have real users using them and generating fees and economic activity and there's a lot of hype around reaking you know insane tvls and uh but I think the the protocol side is like slowly catching up and that's something that we're pretty excited about um there's you know on salana and the Jeter reaking there's some cool protocols that already have thousands of users and a bunch of tvl and uh you know the restak is letting them do things that they couldn't do before that adds better features I think uh if your product if the main pitch of your product is like the reaking or we're using like symbiotic or Ian there like no one really cares about that it's like what what does this enable that you can't do before absolutely um you know we talking a lot about reaking but I want to you know zoom out one level and go back to liquid staking and some of the value props that that really brought you know obviously like being able to have a liquid position is nice but one of the most important things