Karak's TVL Surges Leading to Potential Market Shift Away from EigenLayer
Summary:
Karak, the emerging Ethereum restaking protocol, saw a 25% increase in its total value locked (TVL) last week, reaching over $440 million. Experts predict that it may start impacting EigenLayer's market share due to previous dissatisfaction with the EigenLayer airdrop. EigenLayer faced backlash after banning participants in key crypto jurisdictions from its upcoming airdrop, which could possibly lead to a fall in its TVL. Consequently, EigenLayer has been criticized as a scam aiming to lure inexperienced retail investors, while Karak is experiencing rapid growth and potential.
The newly launched Ethereum restaking protocol named Karak witnessed a surge in its total value locked (TVL) by over 25% in the previous week, exceeding $440 million. This impressive surge has industry experts predicting that it may soon start chipping away at the market share of EigenLayer. The earlier dissatisfaction connected to the EigenLayer airdrop has opened a new opportunity for Karak to potentially become the dominant restaking protocol. Blockchain expert and NFT: From Zero to Hero author, Anndy Lian, shared with Cointelegraph that Karak's ability to support restaking of a variety of assets, such as ETH, LST, LRT, stablecoins, LP tokens, and wrapped Bitcoin, may attract a broader demographic seeking diversity beyond ETH.
In the opening week of April, Karak successfully completed a Series A fundraising round, amassing $48 million and increasing its valuation to over $1 billion. This suggests a sizeable room for future growth. In contrast, EigenLayer, currently the largest restaking protocol on Ethereum, holds a market valuation of $15.7 billion.
On April 29, a significant setback struck when EigenLayer published a whitepaper detailing its upcoming EIGEN token. The whitepaper stated specific jurisdictions, including the United States, Canada, and several countries in Africa and Asia, were barred from participating in its forthcoming airdrop. This action caused an uproar in the cryptocurrency community. Seasoned crypto trader, Jay, opined that this could be a monumental opportunity for Karak. There's a broad consensus that EigenLayer’s decision to exclude key cryptocurrency jurisdictions could trigger a drop in its TVL as stakeholders begin to consider other more beneficial alternatives.
EigenLayer finds itself on unstable ground, with Ran Neuner, crypto analyst and host of Crypto Banter podcast, labeling it as a venture capitalist (VC) scam that appeals to retail investors with little experience. He blasted EigenLayer’s decision to ban its airdrop in key unbanked jurisdictions and keep the airdropped EIGEN tokens locked until a later decision. According to Neuner, such strategies are primarily orchestrated to favor early-stage VC investors.
Published At
4/30/2024 1:37:40 PM
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