EigenLayer is set to distribute 86 million EIGEN tokens as part of its Season 2 stakedrop, according to a recent blog post.
The stakedrop will reward users who have interacted with the platform, including stakers, node operators, and ecosystem partners. The token distribution begins on September 17 and represents about 5% of the platform’s total supply of 1.67 billion tokens.
Breakdown of Token Distribution
In this stakedrop, 70 million tokens will go to stakers and node operators. Meanwhile, 10 million tokens are reserved for ecosystem partners, and the remaining 6 million will be allocated to the EigenLayer community. This marks the second round of rewards distributed through the platform.
EigenLayer’s Growth and TVL Decline
EigenLayer initially gained traction after announcing its token launch in April, attracting around $15.7 billion in deposits. However, the total value locked (TVL) on the platform has since dropped to $11.3 billion, according to DefiLlama data.
EigenLayer is a restaking protocol built on Ethereum, allowing users to stake ETH and secure additional networks or protocols for extra yield. The protocol has faced challenges with a declining TVL, a trend seen across multiple restaking platforms.
Market Pressures Impact TVL
Several factors have contributed to the drop in TVL across restaking protocols like EigenLayer. For instance, Renzo’s TVL fell by 22% to $1 billion, and Karak’s dropped by 14.6% to $688 million. The decline can be attributed to falling asset prices, with ETH currently trading at $2,388, down from its July peak of $3,536.
Additionally, many users have withdrawn assets following the conclusion of various airdrop campaigns, a common strategy among crypto investors earlier this year. This “airdrop farming” involved staking assets to increase their potential share of a token airdrop.
Conclusion
EigenLayer’s Season 2 stakedrop comes at a time when restaking protocols face declining asset prices and reduced TVL. The token distribution aims to reward its users and boost participation in the platform, while the broader market adjusts to changing conditions.
