Kelp DAO Restaked ETH (rsETH) is a Liquid Restaked Token (LRT) by Kelp DAO, a multi-chain liquid restaking platform for Ethereum and EigenLayer. It provides liquidity to assets deposited into restaking platforms like EigenLayer and seeks to tackle the risks and challenges inherent in current restaking options. ^[1]

Overview

Kelp DAO Restaked ETH (rsETH) is a unified liquid restaked token generated from LSTs approved as collateral on EigenLayer. It enables fractional ownership of staked assets, simplifies access to restaking and decentralized finance (DeFi), and utilizes composability within DeFi protocols. Additionally, it resolves issues such as intricate reward systems and excessive gas fees. ^[1][2][3]

Restakers stake their LST to mint rsETH tokens, indicating fractional ownership of the underlying assets. The rsETH contracts then distribute the deposited tokens among Node Operators affiliated with the Kelp DAO. Rewards accumulate from various services to the rsETH contracts, and the price of rsETH tokens reflects the underlying price of these rewards and staked tokens. Restakers can swap their rsETH tokens for other tokens on Automated Market Makers (AMMs) for instant liquidity or redeem underlying assets through rsETH contracts. Furthermore, restakers can leverage their rsETH tokens in DeFi applications. ^[1][2][3]

For Restakers, rsETH provides a streamlined process, eliminating the need to identify suitable services and validators while efficiently managing rewards earned through restaking. For Authorized Validator Services (AVSs), rsETH simplifies the process by avoiding identifying and partnering with operators, streamlining efforts to bootstrap security, and contributing to reducing emissions on rewards. For Operators, rsETH eliminates the hassle of identifying appropriate services, simplifies efforts to attract restakers and restaked assets, and facilitates efficient management of rewards earned through restaking. ^[1][2][3]