Natural progression: DeFi -> LSDfi -> RSTK

Blockchain composability began its exponential growth in DeFi summer. Decentralised swaps, yield farming, rebase tokens, algorithmic tokens, lending, yield aggregators –all happened in the summer of 2020.

The first iterations of DeFi brought new opportunities to interact with blockchains. It was the spark that ignited the constant pursuit of yield. We had the opportunity to interact with blue chip protocols on their earliest days and are thrilled to see them pass the test of time and prove the superiority of DeFi over CeFi.

The bear market has brought the real yield narrative, where market participants focused on protocols that are accruing real value to their holders. Protocols with a shared ownership structure in which cashflow was shared in a decentralised manner to stakeholders were advantageous in comparison to simple governance tokens. The real yield narrative was initially proliferated by the introduction of GMX.

The Ethereum protocol evolved too, as per Vitalik’s roadmap, and has seamlessly turned itself into a yield producing asset, while remaining deflationary – becoming the world’s internet bond. This has increased the risk-free rate of the ecosystem from zero, to a variable yield of 3-5% per annum. This additional yield is the main building block of liquid staking derivatives finance (LSDfi). Protocols built on top of liquid staking with the purpose of the creation of financial instruments with a goal to optimize and/or maximize yield are part of this niche.

LSDfi was the first evolution in yields, Restake Finance (RSTK) will be the next. RSTK allows for the rehypothecation of yield in such a way that users continue earning Ethereum native interest and secure other actively validated systems while earning additional risk-adjusted yield powered by EigenLayer. This niche is in its early days and Restake Finance is the first ecosystem protocol innovating on top the endless possibilities of rehypothecation introduced by EigenLayer.

Rehypothecation Finance is a theme that is now starting with the launch of our platform and will continue growing in the long term. We are excited to build a protocol that will innovate and push boundaries of yield maximization.