Node Capital reports LRT Usage Growth

• LRT, led by Ether.fi, provides a simplified staking process with less than 32 ETH
• The report shows that its usage increased and raised from $164M to approximately $13.8B in 2024
• Also, the report warns that LRT-like solutions are necessary to provide user-friendly decentralization

Node Capital, a Web3 venture fund, has released a report titled “Abracadabra: The Liquid Restaking Over.” It highlights the transformative role of LRTs in the DeFi sector, a significant innovation that simplifies the staking process and enhances the efficiency of DeFi capital.

What Exactly LRTs The Numbers and Role?

LRTs are revolutionizing the restaking sector by converting traditional Ether (ETH) staking into a more efficient model where stakers receive tokens equivalent to their staked ETH, which can be utilized in various protocols.

This development has led to an extraordinary increase in the total value locked (TVL) in LRTs, soaring from $164 million at the start of 2024 to $13.8 billion.

Ether.fi is a key player, commanding over 50% of the LRT market by simplifying complex restaking procedures and allowing staking with less than 32 ETH. For instance, Ether.fi’s eETH facilitates the staking of ETH and its automatic restaking on EigenLayer, enabling users to earn rewards from both activities.

What Is the Point Here?

Despite these achievements, the report raises concerns about centralization, which may prevail if decentralization solutions do not become more user-friendly. That is what LRT protocols aim to solve by providing affordable and simplified decentralization solutions, surpassing LST in both popularity and functionality.

Conclusion

There is no doubt that the heterogeneity of the Web3 space was an initial problem that has long been a key issue in slowing adaptation, and imposing additional cost.

In recent years, we have seen a market with an overabundance of solutions, each trying to take center stage in the Web3 space, but we are also increasingly seeing solutions that try to tie the Web3 industry together into something more cohesive.

Such solutions can energize the entire industry and work for the common good, and they can take a very strong position in Web3 through this, so we need to keep a close eye on them.