Ethereum Restaking

Definition ∞ Ethereum restaking is a novel mechanism that allows staked Ether (ETH) to be reused to secure other decentralized applications or protocols beyond the Ethereum mainnet. Participants who have already staked their ETH on Ethereum can opt to “restake” it with other services, thereby providing additional economic security to those services. This process enables stakers to potentially earn additional rewards for their capital. It increases the utility of staked ETH across the broader Web3 ecosystem.
Context ∞ Ethereum restaking is a significant development within the liquid staking ecosystem, creating new avenues for yield generation and protocol security. A key discussion involves the potential for increased systemic risk due to the compounding of exposure across multiple protocols. Observing news about new restaking protocols or analyses of their economic implications offers current insight into this evolving sector.