Co-founder of Lido, the largest liquid staking platform on Ethereum, along with venture capital funds like Paradigm are secretly funding Symbiotic to compete with EigenLayer in the "restaking" service - a powerful emerging force rising rapidly in the field of decentralized finance (DeFi).
The emergence of EigenLayer, one of the biggest success stories in cryptocurrency in recent times, has attracted inflows of more than $16 billion since opening to investors last year.
The Symbiotic project is developed by the team that built a staking service called Stakemind. Similar to EigenLayer, Symbiotic will provide a new way for decentralized applications, called actively authenticated services (AVS), to secure each other. Users can ârestakeâ assets deposited into other cryptocurrency protocols to help secure AVSs â whether they are rollups, interoperable infrastructure, or oracles â and in return, they will receive reward.
The main difference between Symbiotic and EigenLayer is that Symbiotic allows users to directly deposit any asset based on Ethereum's ERC-20 token standard, while EigenLayer only accepts ETH tokens or ETH derivatives such as stETH, rETH,âŠ. This means that Symbiotic will be directly compatible with Lido's stETH token, as well as thousands of other assets that use the popular ERC-20 standard.
A screenshot from Symbiotic's internal documentation, obtained by CoinDesk, shows the protocol's structure with five linked components.
Symbiotic has the ambition to become a âpermissionlessâ protocol, meaning applications built on the platform will have great freedom in adding and upgrading to suit their intended use. Symbiotic has not released any information about a launch date, but several sources say they expect the platform to be released later this year.
 The illustration for collateral creation will be automated for users when they deposit assets in a vault.
âI'm very excited about what they're doing. It seemed fun and innovative,â shares Silgadze, co-founder of Ether.Fi. âThey seem very focused on building something that is completely decentralized and decentralized.â
The competition between Symbiotic and EigenLayer is a testament to the fierce competition in the DeFi sector, where developers and investors are working hard to find more effective solutions to solve the problem of liquidity. scalability, efficiency, and security of decentralized protocols.
The arrival of Symbiotic, with the support of major investors such as Cyber ââFund and Paradigm, could create a stiff competition with EigenLayer. Symbiotic allowing users to directly deposit assets other than ETH could attract a large number of users and assets to its ecosystem. However, EigenLayer remains a formidable competitor with a large network and solid Total Value Locked (TVL) in the industry.
The DeFi war is becoming increasingly fierce, and Symbiotic's entry into the game could change the situation. Both platforms offer distinct benefits, and competition between them will drive growth and innovation in the DeFi sector.
