Facing regulatory pressure, how will the restaking market develop in the future?

Text: Larry Sukernik, Myles O'Neil

Translation: Frost, BlockBeats

At Reverie, we’ve spent a lot of time researching restaking protocols. For us, this is an exciting investment category because everything is still blurry (opportunities exist in ambiguous markets), and a lot is happening (dozens of projects in the restaking space are expected to launch over the next 12 months).

Through our research into restaking mechanisms, we've developed some perspectives—and we'd like to share our predictions about how the restaking market might evolve over the coming years.

Much of this space is new, so what applies today may not apply tomorrow. Nevertheless, here are some preliminary observations on the business dynamics of the restaking market.

LRTs as Leverage Points

Today, LRTs such as Etherfi and Renzo hold strong positions within the restaking supply chain: they sit at privileged points between suppliers (stakers) and demanders (AVSs). Operating this way, LRTs can set their own fees and influence fee structures at foundational layers like EigenLayer or Symbiotic. Given their strength, expect first-party LRTs to emerge from base-layer protocols aiming to control third-party LRTs.

AVSs and Restakers as Leverage Points

The best markets in the world have two traits: fragmented supply and fragmented demand. What happens when one side—or both—becomes concentrated?

Imagine a simple apple trading market where the largest apple seller controls over 50% of supply. If the marketplace operator raises commissions from 5% to 10%, that dominant supplier could threaten to stop trading on the platform.

Likewise, on the demand side, if the biggest buyer controls over 50% of apple demand, they too can resist fee increases by threatening to leave—or even bypass the marketplace entirely to deal directly with suppliers.

Translating this back to restaking: if the final market structure concentrates either at the AVS end (top 10% of AVSs generating over 50% of revenue) or among restakers (top 10% holding over 50% of deposits), then naturally, these platforms will face constraints in extracting fees—and thus should be valued lower.

While there isn’t enough data yet to prove this, our intuition suggests that winner-take-most dynamics may emerge: large AVSs are likely to dominate transaction volume, giving them negotiating power over future service rates.

Exclusive AVS Access as Competition

From every restaking platform’s perspective, anything a competitor cannot do is worth pursuing. The most straightforward differentiation strategy is offering exclusive access to AVSs—either by developing top-tier AVSs in-house (like EigenDA) or securing exclusive partnerships with third-party AVSs. Conceptually, this mirrors Sony releasing PlayStation-exclusive games—to drive user growth on their platform.

Given this, we expect restaking platforms to increasingly launch first-party AVSs or sign exclusivity deals with third parties. In short, we anticipate a competitive race in the coming months for AVS resources, making AVS access a key battleground.

AVS Subsidies

AVSs must pay operators and restakers for services—meaning they need ETH, stablecoins, points, or future token airdrops. However, most AVSs today are early-stage: lacking tokens, strong balance sheets, mature point systems, or clear airdrop plans. As a result, attracting operators and restakers is difficult (many EigenLayer collaborations rely on custom, privately negotiated contracts). Simply put, it's a case where customers want the service and theoretically have payment capacity, but currently lack funding.

To kickstart the market, restaking platforms may "front" initial payments to operators and restakers—using native tokens, balance sheet assets, or even issuing "cloud credits" redeemable by AVSs. In return, AVSs would likely commit to future airdrops or token allocations to the platform. Alternatively, restaking platforms could prepay AVSs to incentivize partnership over competitors.

In short, we expect intense competition over the next 12–24 months, with restaking platforms vying to subsidize AVS costs. Similar to Uber vs. Lyft, the platform with the deepest pockets—most dollars and tokens to spend—is likely to win.

White-Glove Onboarding

Going from “I want to deploy an AVS” to actually running one is harder than it looks—especially for small teams with limited engineering bandwidth. Questions around security configurations, duration, operator compensation, slashing rules, and standards currently have no established answers.

Best practices will eventually emerge, but for now, restaking platforms must help AVS teams navigate these challenges (notably, EigenLayer does not yet offer payment or slashing functionality).

Therefore, we expect successful restaking platforms to adopt enterprise sales-like models—offering “white-glove” integration and support to onboard new clients quickly and smoothly.

Graduating from the Market

The most successful AVSs may eventually “graduate” from restaking markets.

Today, restaking appeals most to small projects without the time, capital, brand, or network to recruit validators—and without high-value tokens to secure their networks. But as these projects grow, they’ll naturally transition away: recruiting their own validators and securing their networks with native tokens.

This resembles dating apps—where successful users eventually leave platforms like Hinge or Tinder. For marketplace operators, such churn is bad news—you’re losing a customer.

One-Stop Crypto SaaS Store

To illustrate this, consider history: cloud providers like AWS gave developers efficient access to all necessary resources (hosting, storage, compute) for building apps or web services. This drastically reduced development cost and time, enabling a new wave of highly specialized web services. Through both native offerings and vast third-party microservices, cloud providers became “one-stop shops” for non-core development needs.

Similarly, restaking markets like EigenLayer aim to create a parallel ecosystem of crypto microservices. Before EigenLayer, microservices had to either fully centralize off-chain components (passing risk to users) or bear the cost of launching and incentivizing their own validator sets—effectively “buying” security.

Restaking markets could solve this: if successful, microservices can prioritize security without sacrificing cost or speed-to-market.

Imagine you're building a cost-efficient zk-rollup. By entering a restaking market like EigenLayer, you gain easy access to core services like DA and bridging. Along the way, you discover dozens of other integratable AVS microservices.

The more microservices a restaking market offers, the better the experience: users won’t need to shop across multiple independent vendors but can get everything they need from one platform. They may come for Service X, but stay for Services Y and Z.

Some AVSs Will Exhibit Network Effects (e.g., Preconfirmation)

So far, restaking use cases have focused on exporting Ethereum’s validators and economic incentives outward. But another class of “inward” restaking scenarios could add new capabilities to Ethereum’s consensus mechanism—without changing the protocol itself.

The idea is simple: allow validators to opt-in to include additional commitments in the blocks they propose, in exchange for rewards. Failure to comply results in penalties. We expect even a few such commitment types could attract massive participation—small in number, but huge in potential value flow.

Unlike “external” restaking use cases, the effectiveness of these depends directly on validator adoption. Even if you’re willing to pay, if only 1 in 10 validators opts in, it’s not very useful.

But if nearly all validators adopt a given commitment, its guarantees approach those of Ethereum itself (i.e., valid blocks). Thus, we expect strong network effects: as more validators join a commitment market, AVS users benefit disproportionately.

Given this early stage, the most logical path seems to be via Ethereum client sidecars and plugins (e.g., Reth). Similar to proposer-builder separation, proposers may outsource this work to specialized entities and earn a share of the revenue.

It’s unclear what form these AVSs will take. While a single universal market for all commitment types is possible, we expect multiple players focusing on different sources of demand (e.g., L2 interoperability vs. L1 DeFi needs).

In Summary

For students of business strategy, the commercial dynamics of the restaking market represent a rich area for deep study. As you may have sensed, we’ve greatly enjoyed diving into these projects.

More broadly, we believe building first-party infrastructure that enables third parties to create LRTs is more valuable than building dominant first-party LRTs.

A helpful analogy: view L1s like Ethereum as physical clouds, and protocols like EigenLayer as virtualization layers atop these data centers. Just as replicating the scale of global data centers is nearly impossible, duplicating Ethereum’s validator count and economic alignment is impractical. Some attempt this at smaller scales (e.g., Cosmos), but—as with cloud vs. on-premise—renting security from an existing network wins on cost and speed. Restaking markets like EigenLayer aim to unlock a new class of crypto microservices, accelerating development just as the cloud did for Web2.

We’re already seeing this unlocking effect: around 40 microservices are under development on EigenLayer alone. For example, as a rollup developer, you could integrate oracles for your DeFi ecosystem, enable privacy services, plug in off-chain coprocessors for enhanced app functionality, add policy engines for compliance, and integrate security layers—all while achieving richer functionality than any current product. Crucially, if everything works as intended, you’ll get these capabilities at a fraction of the internal development cost and time.

Examples might include L2s seeking pre-confirmations to accelerate finality, DEXs auctioning rights to the first trade in the next block, lending protocols auctioning liquidation rights (e.g., trades placed right after oracle updates), or searchers and builders buying entire blocks from future proposers.