EigenLayer secures $100 million investment from Andreessen Horowitz

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Andreessen Horowitz has announced a $100 million investment in restaking protocol EigenLayer, as reported by Bloomberg this Thursday. Restaking, as the name suggests, is the possibility of staking a crypto for the second time, which in EigenLayer’s case is Ethereum (ETH).

The protocol’s restaking method allows Ethereum network participants to commit their tokens not only to support Ethereum but also to validate additional networks, thereby extending blockchain security across multiple platforms.

“The idea is that when you stake on Ethereum, you are promising that you’re going to run the Ethereum network nodes correctly,” said Sreeram Kannan to Bloomberg. “With restaking, you are taking the same Ether and making additional promises that you will also validate other networks correctly.”

The investment marks Andreessen Horowitz’s latest commitment to the crypto space, following its establishment of a $4.5 billion crypto fund in 2022. The firm remains an active participant in the sector, with General Partner Ali Yahya highlighting EigenLayer’s potential to facilitate the development of new applications and services through its restaking platform.

“It will enable all sorts of new kinds of applications to be built,” Yahya said. “People will stake capital in order to gain rewards from new services that get spun up on top of EigenLayer.” Currently, EigenLayer has over $4.5 billion in total value locked, data from a Dune Analytics dashboard by 21co shows.

EigenLayer’s approach, which currently employs a points system for participants, has attracted attention for its innovative take on blockchain validation without introducing a new token. This strategy may navigate regulatory scrutiny, particularly from entities like the US Securities and Exchange Commission, which has expressed concerns over traditional staking practices.

According to the report, the collaboration between Andreessen Horowitz and EigenLayer is set to be formally announced, emphasizing the venture firm’s role as the sole investor in this funding round.

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