According to the latest data, the total collateral value on EtherFi is $3.24 billion, equivalent to 910,000 ETH.
EtherFi is a decentralized, new infrastructure-based staking protocol on Ethereum. A distinctive feature of EtherFi is that stake holders control their private keys. EtherFi’s mechanism also allows the creation of a node service market for stake holders and node operators to register nodes to provide infrastructure services.
User deposits to EtherFi will automatically be re-staking with Eigenlayer. Eigenlayer uses pledged ETH to support external systems (such as rollups, oracles) and establish an economic security layer, which increases the maximum benefits of ETH stakers in the process.
There are several types of users and stakeholders on etherFi:
- Be both a pledger and a bond holder
- Pledge holders only hold eETH (EtherFi liquid equity mining token)
- Stakeholder node operator
- Node service users
etherFi’s roadmap is divided into three phases:
- Entrusted equity pledge
- Liquidity pool
- Node services
At each stage, the above roles play a different evolutionary role, briefly described below.
Simplified entrusted equity pledge process
For stake holders who wish to stake mine in multiples of 32 ETH, the following workflow will be followed:
1. Node operators submit bids to obtain validator node permissions. Trustworthy people submit directly, and untrustworthy people participate in the auction.
2. The pledge holder deposits 32 ETH into the etherFi contract, triggers the auction and allocates validator nodes, generates a withdrawal safe and two NFTs (T-NFT and B-NFT).
3. The staker uses the winning operator’s public key to encrypt the validator key and submits it to the chain, and the operator uses the decrypted key to start the validator.
4. The staker (or operator) can submit an exit order to restore the pledged ETH.
Other ways to participate:
Equity holders holding less than 32 ETH can mint eETH to participate in mining.
T-NFT holders can deposit it into the liquidity pool and mint eETH of corresponding value. Holders of eETH can exchange it 1:1 with ETH in the liquidity pool.
Specific equity pledge:
Holders of B-NFT can deposit ETH and queue to wait for the allocation of B-NFT. After allocation, the validator will be started and the corresponding NFT will be minted.
Exit process:
When the ETH in the liquidity pool falls below the threshold, the oldest T-NFT triggers an exit request. If the timer expires and the validator does not exit, B-NFT holders will be gradually reduced.
After the validator exits, T-NFT and B-NFT are destroyed, and ETH is deposited into the liquidity pool.
Node services:
In the preliminary stage, technical decisions may change, and NFT represents the economic value of the mortgaged ETH, creating economic incentives for node operators and stakers.
NFTs represent the economic value of staking ETH and can create a programmable layer on top of staking infrastructure by creating economic incentives for node operators and stakers. There are plans to incorporate EigenLayer as a mechanism to support the node service layer.
EtherFi's mission is to provide decentralized access to liquidity to the restaking ecosystem while enabling others to develop infrastructure on top of delegated staking. The protocol is controlled by EtherFi's governance token, ETHFI. EtherFi SEZC is a research and development company and one of the promoters of EtherFi, founded in 2021 by Mike and Rock.
