Symbiotic launched in mid-2024 as a restaking protocol positioning itself as a more flexible and modular alternative to EigenLayer. Backed by Lido co-founders and Paradigm, Symbiotic allowed any ERC-20 token to be used as restaked collateral — not just ETH and its liquid staking derivatives. This meant stablecoins, governance tokens, LP tokens, and any other asset could theoretically provide security to validated services.
The broader collateral approach addressed a real limitation of EigenLayer’s model. EigenLayer primarily accepted ETH and LSTs, which meant protocols secured by EigenLayer were exposed to ETH price risk even if their business had nothing to do with Ethereum. Symbiotic’s multi-asset model let protocols choose collateral types that better matched their risk profiles — a stablecoin-backed oracle network, for instance, wouldn’t need its security to fluctuate with ETH prices.
Symbiotic attracted over $1 billion in deposits within weeks of launch, driven by points speculation and the credibility of its backers. The rapid growth illustrated how easily capital could move between restaking protocols — the same mercenary capital that had filled EigenLayer was happy to split deposits across competitors if doing so maximized total points exposure. The restaking wars between EigenLayer, Symbiotic, and Karak created a competitive market that ultimately benefited depositors through higher rewards.
Leave a Reply