After a period of testing, EigenLayer has recently announced new information about its reward distribution plan for Actively Validated Services (AVS).
According to the latest announcement, EigenLayer will soon launch a reward sharing program for restaking from the activities of AVS networks.
In the “upcoming weeks,” EigenLayer will begin allowing Stakers and Operators to receive rewards for their contributions to the security governance of AVS networks.
Coming Soon: AVS Rewards and EIGEN Programmatic Incentives
Read the full details in the blog post here: https://t.co/uxXvb7TkXC
— Summary Below —
• Actively Validated Services (AVSs) are gaining the ability to reward stakers and operators.
• At least 4% of EIGEN’s total… pic.twitter.com/eBsWDPIqOP
— EigenLayer (@eigenlayer) July 26, 2024
However, EigenLayer stated that the initial rewards will not be high and that it will take time for AVS to reach a “breakthrough” threshold. Therefore, the Boost Reward program will be implemented concurrently with this plan. Specifically, in the first year, “at least” 4% of the total EIGEN token supply will be used as incentive rewards for Stakers and Operators.
The reward distribution ratio between Stakers and Operators will be 90% and 10%, respectively. Notably, at this stage, there will be no Slashing mechanism (penalizing Operators for fraud).
Additionally, EigenLayer clarified that this incentive program is separate from the project’s previous plan to launch Airdrop Season 2. In April 2024, EigenLayer faced much controversy over its airdrop plan, with different rounds and lock-up periods unfavorable to users.
Overall, the implementation of the AVS reward program will help EigenLayer’s business model achieve a balanced cash flow, thereby opening new expectations for the restaking sector in the near future.
Restaking has long been a trend of interest. However, it wasn’t until mid-2024, with the participation of many new players such as Symbiotic, Karak, and even Jito (in the Solana ecosystem), that the overall landscape of this market segment became increasingly diverse.