As an analyst with a background in the crypto industry and a keen interest in decentralized finance (DeFi), I believe that Karak’s recent growth and EigenLayer’s airdrop controversy could significantly impact the market share of Ethereum staking protocols.
The burgeoning staking protocol on Ethereum, Karak, experienced a significant increase in its total value locked (TVL), surpassing $440 million within the last week – an uptick of more than 25%. Market observers speculate that this trend could potentially impact EigenLayer’s market dominance.
After the letdown over the EigenLayer airdrop, Karak has a high probability of emerging as the next significant staking protocol, according to Anndy Lian, international blockchain expert and author of “NFT: From Zero to Hero.” He shared this perspective with CryptoMoon.
“Karak supports a broader range of assets for restaking, including ETH, LST, LRT, stablecoins, LP tokens, and wrapped Bitcoin. This diversity could attract a wider user base looking for more options beyond ETH.”
In early April, Karak successfully completed a Series A funding round worth $48 million, resulting in a valuation exceeding $1 billion for the company. This significant evaluation indicates substantial growth potential for Karak. Notably, EigenLayer boasts a valuation of $15.7 billion – the largest among Ethereum’s restaking protocols.
EigenLayer airdrop disappointment could lead to a drop in TVL
Starting on April 29, EigenLayer unveiled a white paper detailing their upcoming EIGEN token. This document outlined restrictions for certain regions in relation to the token’s upcoming airdrop. Specifically, individuals from the United States, Canada, as well as numerous African and Asian countries were excluded from participation.
In the crypto world, the announcement sparked intense backlash. According to an anonymous cryptocurrency investor named Jay, who posted on April 29, this situation could potentially benefit Karak.
“Think Eigen has handed Karak a golden opportunity.”
As a researcher studying the crypto market, I believe that EigenLayer’s decision to prohibit airdrop participants from certain key jurisdictions might result in a decrease in Total Value Locked (TVL) on their platform. This is due to the fact that stakers may seek out more profitable alternatives in response.
“Farmers and stakers who were eagerly anticipating the EIGEN airdrop might now seek alternative platforms or protocols. Some may choose to reallocate their assets to other DeFi projects that offer more inclusive airdrop opportunities.”
According to crypto analyst and Crypto Banter podcast host Ran Neuner, EigenLayer is suspected of being a scam aimed at luring unsophisticated retail investors’ liquidity based on his assessment in a recent blog post dated April 30th.
“Early VCs get in early at small valuations – Retail will get in at $15bn+. Low circulation high [fully diluted valuation] at the start – let’s fleece more retail…”
Neuner contended that the prohibition on airdrops in pivotal unbanked regions and the plan to retain control over EIGEN tokens distributed via airdrops primarily benefits early-stage venture capital investors.
“Any retail investor that buys this in the first 3 years will be punished.”
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2024-04-30 13:53