- Jito has taken another step forward in bringing restaking into the Solana network.
- The new code will allow applications building on Solana to use restaking as a security mechanism.
- The yet-to-be-audited code will allow multiple assets to be restaked across the DeFi ecosystem.
Solana is taking more steps in bringing liquid restaking into its ecosystem after the Jito Foundation announced the release of an open-source code for restaking services.
The code has not been audited, but it will lay the foundation for restaking in Solana, allowing decentralised applications (dApps) on the network to integrate restaking functionalities, providing them with heightened economic security.
Restaking allows already staked tokens to redeploy on other blockchain applications, providing an extra yield to users and making the network more secure with economic incentives. The bigger the validator network that restakes tokens across multiple ecosystems, the harder it is for malicious actors to compromise them.
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How Will it Work?
Jitop’s restaking product has similarities with EigenLayer, the leading restaking protocol in Ethereum, but is fundamentally different in specific crucial points.
According to the blog post, Jito Restaking consists of two key components —the Vault Program and the Restaking Program. The first manages the creation and operation of liquid restaking tokens (LRTs) while supporting multiple SPL tokens as the underlying asset, among other crucial features.
Meanwhile, the Restaking Program allows users to restake liquid stake tokens or multiple SLP tokens. It is also responsible for managing the AVS (actively validated services) and the distribution of rewards and slashing penalties.
In short, node operators can restake multiple types of assets, not just SOL, which are then used to secure the AVS, and those who misbehave will get their tokens slashed. Moreover, the code will allow dApps to use any crypto asset to enhance security, unlike EigenLayer’s model, which only allows ETH, ETH derivatives, and EIGEN tokens.
Jito Takes One Step Forward Towards Restaking
Jito, known as JitoSOL, is one of the largest dApps on Solana. It’s a liquid staking protocol with a unique approach towards MEV-powered staking. Instead of fighting against MEV (maximal extractable value), Jito redistributes some of the MEV rewards through an auction system, maximising rewards while minimising the negative effects of this controversial practice.
Jito allows users to stake SOL and SLP tokens in liquidity pools and receive a JitoSOL in exchange. What has boosted Jito’s popularity is the ability to use the liquid tokens in multiple DeFi apps within the Solana ecosystem and also earn staking and MEV rewards.
Related: Introducing Blinks: Blockchain Links Arrive on Solana – Here’s Why It Matters
Restaking is not live yet in the Solana network, but Jito’s code is a significant step forward. The protocol has become a fundamental player in Solana’s DeFi ecosystem, constituting nearly 50% of Solana’s total value locked (TVL) at US$2.05B (AU$3.13B).
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