Ethereum's Liquid Restaking Sector Suffers 56% Profit Plunge
Ethereum's liquid restaking sector has seen its combined gross profit plummet by 56% in three quarters, according to an analysis by CoinDesk using DefiLlama data. The five major protocols involved, Renzo, Kelp, Swell, Puffer Finance, and Bedrock, generated a combined $953,350 in gross profit in the second quarter of this year.
This decline is attributed to the failure of fees from projects buying security services to generate expected extra yield. The sector's core problem lies in declining incentives and the risks borne by users, making the revenue gap more apparent.
Ether.fi has been affected by this shift, with its EigenLayer connection being terminated due to a lack of meaningful additional yield opportunities and perceived user risks. The company is now focusing on card, borrowing, and investment vault products, positioning itself as a crypto neobank.