Binance Labs invests in re-staking Ethereum onto the BNB chain

Binance Labs, the venture capital arm of the leading centralized exchange, announced its investment in Puffer, a project that will re-pledge Ethereum liquidity onto the BNB chain.

The funds will be used to build Puffer’s infrastructure, open source technology and layer 2 networking. Puffer’s L2 will be protected by the groundbreaking re-staking protocol EigenLayer, operating as an Active Verification Service (AVS).

“Puffer will bring its native Liquidity Re-staking Token (nLRT) to BNB Chain users so that they can earn Ethereum PoS and re-staking rewards,” Binance said. “Puffer aims to do this by reducing verification-related operational risk and cost to democratize staking on Ethereum, making it suitable for home validators.”

Liquid re-injection drives EigenLayer growth

Puffer aims to be the first project to bring ETH re-staking benefits to a network outside of the Ethereum ecosystem.

ETH re-staking income comes from EigenLayer, which allows users to generate income by verifying third-party AVS protected by EigenLayer while receiving Ethereum staking rewards. Users can re-stake ETH without limit, or deposit liquid staking tokens (LST) into EigenLayer’s capped pool.

Liquid re-staking tokens allow token holders to earn re-staking benefits without launching an Ethereum node and locking up funds – meaning users can circumvent EigenLayer’s 7 by selling tokens when exiting a position Withdrawal delays of up to 3 days – reducing the technical hurdles and friction associated with it. Obtain re-staking yield.

According to DeFi Llama, the emergence of liquid re-staking tokens, coupled with EigenLayer’s recent increase in its LST pool limit, has pushed EigenLayer’s total value locked (TVL) to over $2 billion after hitting $252 million in mid-December . Currently, the value of native re-pledged Ethereum is $986.3 million, accounting for 48% of the total, and the total liquidity of re-pledged tokens is approximately $900 million.