Sreeram Kannan & Kartik Talwar I Restaking Risks with EigenLayer I Pragma Denver 2024

Wed, Oct 2, 2024, 12:00 AM

In this in-depth discussion at Pragma Denver 2024, Sreeram Kannan, founder of EigenLayer, joins ETHGlobal's Kartik Talwar for a candid deep dive into the risks, complexities, and cryptoeconomic design behind restaking. They explore potential attack vectors, slashing mechanisms, the role of AVSs (Actively Validated Services), liquid restaking tokens (LRTs), and the intricate dynamics of building programmable trust on Ethereum. This conversation breaks down how EigenLayer’s security models work—pooled vs. attributable security, how incentives are structured for LRTs, why slashing protection matters, and how restaking may lead to leverage, cascading risks, and systemic vulnerabilities. If you're a builder, researcher, validator, or DeFi user curious about Ethereum restaking, this is a must-watch. 00:00 Intro: Breaking down risks in EigenLayer 00:54 What is restaking and AVS explained 03:13 Real-world examples of AVSs and use cases 04:49 Operators, stakers, and service builders 05:51 What are liquid restaking tokens (LRTs)? 07:32 Can LRTs be restaked or looped? 08:42 Importance of full risk accounting 09:50 Pooled security vs. attributable security 11:31 Buying and assigning slashing rights 13:33 Market dynamics for AVS security 14:46 How AVSs incentivize stakers 16:29 Token rewards and APR boosting 18:07 What happens when AVSs go wrong 19:42 Slashing governance and veto committees 21:12 Future of permissionless AVS onboarding 22:15 Risks of collusion and slashing protection 23:18 System impact from major AVS slashing 24:25 IgenLayer’s fail-safes and withdrawal delays 25:58 Leveraged restaking risks explained 27:39 Cascade effects and LRT depegging 28:39 Stablecoins or CDPs built on LRTs 29:49 Can the EigenLayer token collateralize the system? 30:23 Other scenarios leading to mass slashing _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 🇺🇸 *Pragma Denver* Pragma Denver 2024 took place at The Arch in Denver on February 28, 2024, and was an in-person summit for builders and leaders in the web3 ecosystem. Pragma is a one-stage conference with founders-only on stage, bringing together a small group of curated attendees and speakers to discuss the future of web3 and reflect on the past. Watch the full Pragma Denver playlist here: https://youtube.com/playlist?list=PLXzKMXK2aHh4lJw0vruQ4prh8iMDUk89i&si=ayJ64Sgcqew1fdFk ETHGlobal's Pragma series takes place in cities around the world, and is designed to be a different kind of event. Ever since we first introduced our new event series, Pragma, in Tokyo in the spring of 2023, we have been fostering a curated, global community of individuals who deeply care about web3. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅ *Follow Sreeram Kannan* X: https://x.com/sreeramkannan ✅ *Follow EigenLayer* X: https://x.com/eigenlayer ✅ Follow Kartik Talwar X: https://x.com/therealkartik Warpcast: https://warpcast.com/kartik ✅ *Follow ETHGlobal* X: https://x.com/ETHGlobal​ Warpcast: https://warpcast.com/ethglobal Website: https://ethglobal.com YouTube: https://www.youtube.com/c/ETHGlobal _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _Are you interested in Ethereum development and entrepreneurship?_ 👉 Sign up for the next ETHGlobal event: https://ethglobal.com/events 🎁 Get exclusive access and perks with ETHGlobal Plus! https://ethglobal.com/plus 📣 Want us to throw an event in your city? Tell us where! https://ethglobal.com/city _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _