Written by: Chris, Techub News
On April 23, the liquidity re-staking protocol Renzo (EZ) became the 53rd project of Launchpool.
Starting from 8:00 am on April 24th (UTC), users can stake BNB and FDUSD into Launchpool to receive EZ Rewards. The EZ Mining event will last for 6 days, and the Launchpool website will be updated before the mining event opens.
After the mining activity ends, Binance will list Renzo (EZ) at 20:00 on April 30, Beijing time, and open EZ/BTC, EZ/USDT, EZ/BNB, EZ/FDUSD and EZ/TRY trading markets. EZ will be subject to seed tag trading rules.
According to the author's exclusive interview with Renzo through Foresight News, the Restaking narrative began in January 2024, but Renzo, as the first LRT protocol to go online, was already online in December last year. Although the three founders are all old leeks in the cryptocurrency circle, Renzo started from scratch and had a hard time. Since starting the business last summer, it has been completely supported by its own funds until November. I met Maven11 in Turkey. No one has received a salary, but they all received investment from Binance Labs this year.
So what kind of project can be favored by Binance Labs under such circumstances?
About Renzo
Renzo simplifies the re-staking of Ethereum and ensures the security of DeFi investments through Eigenlayer. It does this by enabling ETH deposits to mint EZETH, leveraging Active Validation Service (AVS) to protect applications built on EigenLayer using Ethereum’s first layer security protocol.
The Renzo protocol also provides a smooth way to interact, making the interaction between users and Eigenlayer node operators more efficient, which is of great significance in the Ethereum ecosystem. This simplifies the complexity of DeFi, enables seamless interaction between users and EigenLayer node operators, and improves the efficiency of the Ethereum ecosystem.
Furthermore, Renzo not only increases the earning opportunities for ETH stakers, but also enhances the security and reliability of services within the Ethereum blockchain, marking an important step in the development of DeFi.
Overall, Renzo's core is to promote the advancement of permissionless innovation on Ethereum, striving to achieve programmable trust acquisition throughout the ecosystem. Through careful design, it promotes the widespread adoption of EigenLayer by abstracting complex details and presenting a user-friendly interface, thereby increasing participation and engagement.
Token Economics
The total supply of EZ will be 10 billion, and the circulating supply at listing will be 1.05 billion, accounting for about 10.50% of the total token supply. The specific distribution mechanism is as follows.
Binance Launchpool will allocate 2.50%;
The airdrop will allocate 10.00%;
Investors and advisors will be allocated 31.56%;
The team will be allocated 20.00%;
The foundation will be allocated 13.44%;
The DAO Treasury will be allocated 20.00%;
The liquidity budget will be allocated 2.50%;
Project operation process
The Renzo protocol operates through a well-structured mechanism that leverages the EigenLayer framework to simplify the process.
Here is a brief summary of how it works:
1. Deposits and minting: Users deposit ETH or Liquid Staking Tokens (LST) to Renzo, and Renzo will mint an equal amount of ezETH (a liquid derivative representing the staked asset).
2. Ensure AVS security: Renzo is able to ensure the Active Verification Service (AVS) on EigenLayer, and users can inject ETH into and ensure the security of these services, thereby obtaining additional rewards in addition to traditional staking rewards.
3. Strategic Management: As a strategic manager, Renzo optimizes the repricing process by selecting the best combination of AVS to maximize returns while minimizing risks.
4. Yield Generation: The protocol generates revenue through ETH validators, and with the launch of AVS, repricing revenue will be generated through Renzo node operators plugging into these services.
5. Rewards Distribution: The protocol captures the rewards generated by repricing and securing AVS and reflects them in the value of ezETH, providing users with tokens in which to earn rewards.
6. Enhanced participation: Renzo introduces ezPoints and EigenLayer Points to reward users for their participation and contribution to the success of the protocol.
7. Governance and Decision-making: Governance mechanisms, including snapshot voting and eventual on-chain governance, provide guidance for strategic decisions, such as selecting AVS to support by node operators.
Through this multifaceted approach, the Renzo Protocol provides Ethereum users with a dynamic, beneficial reset ecosystem that enhances both yield opportunities and the security of the network.
Core Mechanics
EigenLayer Protocol
EigenLayer is the core technical component of the Renzo protocol, providing a new layered structure for the Ethereum network, making asset staking and network verification more efficient and flexible. The design goal of EigenLayer is to enhance the scalability and functionality of the Ethereum ecosystem by allowing existing Ethereum validators to leverage their staked assets to support new and innovative services. The following are several key aspects of EigenLayer in the Renzo protocol:
1. Hierarchical Authentication
EigenLayer works by creating an additional validation layer that is independent of the main Ethereum blockchain. In this layer, validators can participate in more and different types of network activities, such as specific computing tasks or new consensus mechanisms.
2. Resource reuse
A core feature of this layer is that it allows validators to reuse their staked assets on the Ethereum main chain. This means that validators can support more services without additional staked funds, thereby improving capital efficiency and lowering the threshold for participating in new services.
3. Enhanced network capabilities
Through EigenLayer, the Renzo protocol increases the functionality of the Ethereum network, including data verification, transaction execution, and other possible services such as cloud storage or complex data processing tasks. These services, which may have originally required new infrastructure and additional resource investment, can now be achieved through existing validator assets.
4. Rewards and Incentives
Validators participating in EigenLayer can receive additional rewards based on the services they provide at this layer. This not only increases their overall benefits, but also promotes the participation of more validators and the growth of the network.
5. Security and Decentralization
EigenLayer is designed with security and decentralization in mind. Although it adds a new layer on top of the Ethereum main chain, it still maintains the decentralized nature of the network and ensures the security of operations through multiple verification and security protocols.
6. Community-driven governance
EigenLayer and Renzo protocols support decentralized governance, where community members can influence key decisions through voting, such as adding new services, adjusting reward mechanisms, etc. This ensures the transparency and adaptability of the protocol, enabling it to respond to community needs and changes.
By introducing EigenLayer, the Renzo protocol provides a mechanism that enables the Ethereum network to not only support existing staking and verification operations, but also expand to more applications and services, further enhancing Ethereum's position as the world's leading smart contract platform. This technological innovation is of great significance to promoting the long-term development of the Ethereum network and the advancement of decentralized finance (DeFi).
Active Authentication Service (AVS)
Active Validation Services (AVS) in the Renzo protocol is one of its core features, designed to enhance the functionality and security of the Ethereum network. AVS allows stakers to increase their returns by participating in additional validation activities while providing value-added services to the network.
These services are implemented by Renzo through the EigenLayer framework. The following is a summary of some key information about AVS:
1. 1. Purpose of AVS
The main purpose of AVS is to expand the functionality of the Ethereum network, allowing nodes to participate in other activities that benefit the network in addition to traditional block verification. These activities can include data verification, network security operations, specific computing tasks, etc.
2. 2. How it works
In the Renzo protocol, stakers can choose to participate in different AVS projects. This usually involves locking their staked assets (such as ETH) into specific services that require additional verification activities to maintain their operation and security. In this way, stakers not only support the basic functions of the Ethereum network, but also provide support for other layers and services.
3. 3. Reward Mechanism
Stakeholders who participate in AVS can receive additional rewards derived from the value-added services they provide to the network. This means that, in addition to the basic staking rewards, stakers can significantly increase their overall returns by participating in AVS.
4. 4. Risk Management
While participating in AVS can provide higher returns, it may also bring additional risks. These risks may include technical failure, service interruption, or cyber attack. Therefore, Renzo Protocol has designed risk mitigation measures such as selecting a diverse range of AVS projects and implementing high-standard security protocols.
5.5. Governance and Choice
AVS projects are typically selected and approved through a decentralized governance process, which means that community members (including stakers) can vote on which services should be included in the protocol. This ensures transparency of the project and community participation.
6. 6. Technical Implementation
Technically, AVS is implemented through smart contracts and the EigenLayer framework, which define the specific parameters of the service, reward distribution, and participation rules. This structure allows flexible service management and automated reward distribution.
By providing active verification services, the Renzo protocol not only increases the potential returns for stakers, but also brings more functionality and value-added services to the Ethereum ecosystem. These services help improve the efficiency and security of the entire network, while also promoting the development of decentralized finance (DeFi) and other blockchain applications.
Cross-chain re-staking
Cross-chain re-staking in the Renzo protocol is one of its innovative features. This feature allows users to reuse staked assets across multiple blockchains, further improving capital efficiency and the convenience of participating in multiple blockchain ecosystems.
The following is the author’s summary of the key information of the Renzo protocol’s cross-chain re-staking mechanism:
1. 1. Definition of cross-chain re-staking
Cross-chain re-staking allows users to use their staked assets on one blockchain (such as Ethereum), such as ETH, for related activities on another blockchain without withdrawing the original stake. This is achieved by creating a derivative asset (such as EZETH in the Renzo protocol) that represents the original staked asset, which can be freely circulated and used on other chains.
2. 2. Improvement of capital efficiency
Through this mechanism, pledgers can participate in more blockchain project pledge and governance activities without increasing additional capital investment. This not only improves the efficiency of the original capital use, but also enables users to explore new investment opportunities and sources of income.
3. 3. Technical Implementation
Renzo uses advanced cross-chain technologies such as bridging and lock/unlock mechanisms to ensure the secure flow of assets between different chains. The user's original assets are locked on one blockchain, while the equivalent proxy assets are generated on another blockchain. These proxy assets inherit certain properties and rights of the original assets.
4. 4. Risk Management
Although cross-chain restaking provides many benefits, it also brings certain risks, such as cross-chain bridge security issues and liquidity risks. The Renzo protocol has designed corresponding security measures, such as multi-signature and smart contract audits, to reduce these risks.
5. 5. Governance and Automation
Cross-chain re-staking typically involves a complex governance structure as it must deal with interoperability issues across multiple blockchains. The Renzo protocol may include automated governance tools that enable users to efficiently manage their staking and voting rights on multiple chains.
6. 6. Ecosystem Collaboration
The successful implementation of cross-chain restaking relies on collaboration with other blockchain projects and protocols. The Renzo Protocol builds partnerships and compatible standards to ensure widespread acceptance and use of its cross-chain capabilities.
Through cross-chain re-staking, Renzo Protocol not only strengthens its position as a versatile DeFi platform, but also pushes the boundaries of blockchain technology, enabling users to seamlessly operate and increase value across multiple blockchain ecosystems around the world. This technological advancement opens up new possibilities for the future development of decentralized finance.
Summarize
Overall, I believe that the Renzo protocol marks a major leap forward in the DeFi space, simplifying Ethereum re-hypothecation through innovative methods, making it easier for users to participate and maximize returns. By directly connecting users to the EigenLayer ecosystem, Renzo not only improves efficiency but also ensures the security of the blockchain. Its recent financing success reflects the strong trust in it and highlights Renzo's role in making DeFi more accessible and valuable.
Combining its advantages and disadvantages, the Renzo protocol has certain growth potential in the DeFi field, especially in providing innovative staking solutions and promoting the efficiency of the Ethereum network. However, its success will also depend on technological innovation, market acceptance and the development of the regulatory environment.
It is also worth mentioning that as a re-staking platform, there are many other protocols in the Renzo ecosystem that allow you to deposit your ezETH into their products and increase the Renzo points you earn, some of which will give you double rewards. These protocols include Pendle, Linea, and Ionic. The entire list can be found at https://app.renzoprotocol.com/defi. Some of the participating protocols have not yet issued tokens, and interacting with them can also increase your chances of receiving potential airdrops in the future of the protocol.
