Author: Jack Kubinec, Blockworks; Translated by: Deng Tong, Golden Finance
Solana’s largest liquidity staking project is moving into restaking.
Earlier today, the Jito Foundation announced in a blog post that it has released the code for Jito Restaking, a move that puts the Jito Foundation ahead of the race to build restaking on Solana as the network’s fast and low-cost DeFi ecosystem continues to expand.
Restaking is the use of staked cryptocurrencies to secure other blockchain applications and services, theoretically extending the security of the blockchain’s base layer. In theory, this should leverage unproductive staked assets and make proof-of-stake systems more efficient.
Eigen Labs was the first to launch EigenLayer on Ethereum, and in addition to a16z's $100 million investment, EigenLayer has also attracted billions of dollars in deposits.
Restaking is not live on Solana yet, but Jito’s release of its codebase represents a noteworthy step forward. One major competitor is Solayer, which has generated a lot of interest in the brief period it has been accepting deposits. Solayer’s GitHub does not contain code for its restaking product.
Jito’s restaking brings together one of the most compelling pillars of the Solana ecosystem with one of crypto’s hottest narratives. Jito runs a fork of the original Solana Labs validator client with some modifications to achieve Maximum Extractable Value (MEV). This MEV can be very lucrative for validators running the Jito-Solana client. Jito co-founder Lucas Bruder said on X that earlier today, one validator received $311,000 in tips in a single transaction.
Users who stake Solana tokens using Jito’s liquid staking pool can earn liquid JitoSOL. The pool is the network’s largest, and JitoSOL can be used elsewhere in DeFi while earning staking and MEV rewards. Since launching in November 2022, JitoSOL has become Solana’s main liquid staking token, accounting for about 45% of all liquid staking tokens on the network. (It’s worth noting that only about 6% of staked SOL is held in the form of liquid staking tokens.)
As detailed in a blog post on Thursday, Jito’s restaking product uses similar nomenclature to EigenLayer. Node operators can let stakers restake their assets, which are used to secure the Active Validation Service (AVS). Misbehaving nodes can be slashed.
One notable difference is that Jito staking can accept any token using the Solana SPL token standard, while EigenLayer only accepts EIGEN and staked or liquid-staking Ethereum.
