Author: Climber, Golden Finance
On July 4, the total lock-up value (TVL) of the re-pledge project Symbiotic officially exceeded US$1 billion, and it has been less than a month since the project went online. Previously, Symbiotic’s TVL reached US$200 million in just two days after it was launched. It has been rising since then, and its pledge pool has reached the upper limit many times. When it announced that it would increase the upper limits of multiple re-pledge pools, the project’s TVL soared three times that day.
Symbiotic is also a project that is favored by Paradigm and Lido, and has raised US$5.8 million in its seed round. As a new force in the re-staking track, many people in the industry regard it as a competitor of EigenLayer.
Introduction to Symbiotics
Symbiotic is a shared security system. It is designed to be an extremely flexible, permissionless and reliable lightweight orchestration layer. It allows web developers to adjust and control their own (re)staking methods. Shared security means that multiple networks can share the services and security of the same group of node operators, thereby improving capital efficiency and security.
Similar to EigenLayer, Symbiotic will provide decentralized applications with a solution called Active Verification Services (AVS) to jointly ensure security. Users are able to re-stake their assets stored in other crypto protocols to help secure these AVSs in exchange for rewards.
However, compared to EigenLayer, Symbiotic allows users to "re-pledge" using Lido's stETH and other popular assets that are natively incompatible with EigenLayer. It can be said that users are allowed to pledge a wider range of tokens, including ERC20 tokens, Ethereum validators Withdrawal certificates and liquidity provision certificates, etc.
In addition, Symbiotic provides more flexible component customization options. While the core protocol is partially defined by the immutable core contract, other components such as pledged assets, reward mechanisms, and penalty criteria can be configured by the network or other agents as needed.
Developed by the team that previously created the Stakemind staking service, Symbiotic aims to be “a permissionless re-staking protocol that provides decentralized networks with a flexible mechanism to coordinate node operators and economic security providers.”
Symbiotic protocol features:
Multi-asset support: Symbiotic allows direct deposits of any ERC-20 token, including Lido’s stETH, cbETH, and more. This makes Symbiotic more diverse and efficient than Eigenlayer, which mainly focuses on ETH and its derivatives.
Modular design, customizable parameters: Networks using Symbiotic can choose their collateral assets, node operators, reward and penalty mechanisms, and all participants can flexibly opt in or out of the shared security arrangements coordinated through Symbiotic.
Immutable core contracts: Symbiotic’s core contracts are non-upgradeable (similar to Uniswap), which reduces governance risks and potential points of failure, and reduces execution layer risk.
Permissionless design: By allowing any decentralized application to be integrated without approval, Symbiotic provides a more open and decentralized ecosystem.
core module
The Symbiotic protocol consists of 5 interrelated components:
1. Collateral
Symbiotic’s safety layer. Collateral is an abstract concept used to represent underlying on-chain assets that are independent of the chain and assets. Collateral in Symbiotic can include ERC20 tokens, Ethereum validator withdrawal certificates, or other on-chain assets (such as LP positions) without being limited by which blockchains the positions are held on.
2. Treasury (vault, also known as industry pledge pool)
Symbiotic’s (re)staking layer. Delegating collateral to a cross-network operator is handled by a vault that can be managed in a customized manner (e.g., by a liquidity (re)collateralization provider such as Lido or an institutional holder) or via delegation to an operator-specific Vault.
3. Operator (also known as validator, orderer, guardian, caretaker...)
An operator in Symbiotic is defined as an entity that runs network infrastructure. In Proof of Stake, successful staking providers have established a brand identity and operate across the network. The Symbiotic protocol creates a registry of operators and enables them to opt-in to the network and receive financial support from re-stakeholders via the vault.
4. Parser (aka reduction committee, proof, dispute resolution framework...)
A resolver is an entity or contract responsible for passing or vetoing penalties incurred by an operator on the network it serves. They are agreed upon by vaults representing economic security providers and the networks for which they provide security.
Resolvers can be fully automated (in the case of objectively provable curtailment violations) or can take the form of entities such as curtailment committees and external dispute resolution frameworks. Resolvers enable the network and recollateralizers to share collateral with each other by providing an (ideally neutral) third party to arbitrate penalties.
5. Network (also known as application chain, summary, AVS, etc.)
A network in Symbiotic is defined as a protocol that requires a decentralized set of node operators to provide trust-minimizing services, such as decentralized ordering of transactions, reaching consensus on off-chain data and bringing it on-chain (oracles), Automate specific protocol functions (Guardians), etc.
Decentralized infrastructure networks can leverage Symbiotic to flexibly gain security in the form of operator and financial support. In some cases, a protocol may consist of multiple subnetworks with different infrastructure roles. The modular design of Symbiotic protocols allows developers of such protocols to define the rules of participation by which participants need to opt-in to these subnetworks.
Symbiotic enables network builders to define, control and adjust their methods of onboarding, incentivizing and punishing operators and their principals (economic collateral providers).
Project news
Symbiotic was launched on June 11, the day the stETH deposit pool reached its limit. Since then, Symbiotic has repeatedly announced that the protocol pledge pool has reached its upper limit.
On June 12, the Symbiotic Tweet protocol reached the pledge limit of 41,290 wstETH within 5 hours. Nonetheless, users can still stake other assets, and with the initial expansion of the protocol, the staking cap will gradually increase and more asset options will be added. Just one day later, Symbiotic stated here that all of the project’s available re-hypothecated assets have reached the staking limit.
On June 27, Symbiotics announced that USDe had reached the pledge limit and added USDe and ENA as new re-pledge assets. However, the USDe pool hit the hard cap of $50 million just 15 minutes after it opened.
On July 3, Symbiotic, a restaking protocol backed by Paradigm and Lido, has increased deposit caps on multiple restaking pools. This also allowed its TVL to take off directly and break through the US$1 billion mark.
Currently, the Symbiotic ecosystem has nearly 20 partners, and the well-known projects are as follows:
On the day Symbiotic was launched, Lido DAO announced that it would cooperate with the re-pledge revenue platform Mellow Finance and the re-pledge protocol Symbiotic to launch “Restaking Vaults”.
Subsequently, LayerZero Labs announced that Symbiotic will be launched on LayerZero. Through Ethena Labs, Symbiotic will be integrated into the LayerZero DVN framework, allowing users to pledge ENA to ensure the cross-chain transfer of Ethena assets. Another staking giant, ether.fi, also announced the launch of Symbiotic-based Liquidity Re-pledge Tokens (LRT) weETHs.
In addition, Ethena Labs also announced that it will cooperate with Symbiotic and LayerZero to pilot a universal re-pledge module.
summary
It was previously rumored that Symbiotic's rise to the top was due to the rejection of Paradigm's previous investment in EigenLayer, and it turned to its competitors in anger. At the same time, the market speculates that the staking leader Lido is cultivating new forces in response to the danger of EigenLayer. But in any case, a competitive and intertwined track can better produce high-quality project teams.
(The above content is excerpted and reprinted with the authorization of our partner PANews, original text link | Source: Golden Finance)
Statement: The article only represents the author's personal views and opinions, and does not represent the objective views and positions of the blockchain. All contents and opinions are for reference only and do not constitute investment advice. Investors should make their own decisions and transactions, and the author and Blockchain Client will not be held responsible for any direct or indirect losses caused by investors' transactions.
〈With the support of top resources, TVL has increased by more than 1 billion US dollars in a single month, what is so special about the re-pledge agreement Symbiotic? 〉This article was first published in "Block Guest".
