RedStone Oracles Secures $500 Million Deal with Ether.Fi

RedStone Oracles, a provider of data feeds for blockchains, has inked a significant deal with Ether.Fi, a leading liquid restaking service on EigenLayer. This move comes amidst the rising popularity of "actively validated services" (AVSs) eager to leverage EigenLayer, a novel "restaking" protocol enabling emerging networks to borrow Ethereum's security.

Key Partnership

RedStone Oracles, a pivotal player in the AVS landscape, announced the sealing of a $500 million agreement with Ether.Fi. This collaboration aims to bolster RedStone's oracle protocol, facilitating seamless information exchange between blockchains and the external world.

The EigenLayer Ecosystem

EigenLayer recently introduced a preliminary version of its service to Ethereum's mainnet, attracting over $12 billion in user deposits. Notably, a substantial portion of these deposits originates from liquid restaking intermediaries like Ether.Fi, which streamline the deposit process for end-users, enhancing accessibility and potential returns.

Pooled Security Mechanism

The billions of dollars in restaked deposits are poised to play a pivotal role in EigenLayer's "pooled security" framework. This system enables operators to delegate their stake to support specific AVSs, reinforcing network integrity and resilience against potential threats.

Operational Dynamics

Under the terms of the agreement, Ether.Fi commits $500 million to fortify RedStone's data oracles. Over 20,000 node operators from Ether.Fi will oversee RedStone's AVS, leveraging Ether.Fi's native liquid restaking token, eETH, to safeguard against liveness failures and crypto-economic attacks within the network.

Integral Role of Liquid Restaking Services

Liquid restaking services play a crucial role in directing user deposits to EigenLayer, offering additional incentives and tradable "liquid restaking tokens." Ether.Fi currently boasts $3.8 billion locked up with EigenLayer, reinforcing the platform's security mechanisms and fuelling its pooled security system.

Expanding Partnerships

RedStone's collaboration with Ether.Fi echoes a similar agreement reached with Omni, another AVS network, in March. Ether.Fi pledged $600 million worth of its stake to Omni, further underscoring the growing synergy between AVS networks and liquid restaking services.

EigenLayer's Growth Trajectory

EigenLayer has amassed over $15 billion in deposits, highlighting its rapid ascent within the blockchain ecosystem. Despite its substantial deposit volume, the current iteration on Ethereum's mainnet lacks certain core functionalities, with EigenDA being the sole AVS deployed thus far.

While AVS networks like RedStone Oracles can register with EigenLayer, deployment onto the platform is slated for later this year, as per Eigen Labs' estimates. This delay underscores the intricate developmental roadmap and rigorous validation process inherent to EigenLayer's ecosystem.