Venture capital giant Andreessen Horowitz has invested $100 million in the development team behind EigenLayer, a restaking protocol built on Ethereum (ETH).
Ali Yahya, a general partner at Andreessen Horowitz (also known as a16z), predicts that the EigenLayer will expand Ethereum’s capabilities.
“EigenLayer is a set of smart contracts on Ethereum that creates a two-sided marketplace for raw cryptoeconomic security: On the demand side, it allows creators of custom decentralized services to write code that effectively extends the functionality of Ethereum.
And, on the supply side, validators participating in Ethereum consensus — if they happen to have the capacity and required hardware — can opt into running each of those decentralized services by restaking their ETH to them.”
Restaked ETH can be used as “cryptoeconomic security for protocols other than Ethereum, in exchange for protocol fees and rewards,” according to EigenLayer’s website.
Eigen Labs, the project’s development team, announced a16z’s investment on Thursday.
In a related move, Binance Labs is investing an undisclosed amount in Renzo, a liquid restaking token for EigenLayer. The project aims to serve as the primary on and off-ramp for Ethereum restaking.
Binance co-founder Yi He, who leads the exchange’s venture capital arm, says Renzo’s technology enables more users to participate in liquid restaking.
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