Although ETH has performed poorly recently, as a loyal ETH holder, finding ways to steadily increase the token value is a very worthwhile topic to study carefully.
To conclude, considering security and liquidity, the best low-risk opportunity to increase ETH token value currently is Ether.fi. Ether.fi's actual yield is 5.8%, significantly higher than other similar protocols.
According to Pendle's calculation, tETH is a new protocol without market validation, and Lido requires a certain lock-up period. Therefore, Ether.fi's Symbiotic pool has the highest yield among the aforementioned protocols.
Let's dive in:
About Ether.fi
Ether.fi is a decentralized Staking protocol built on the Ethereum blockchain. Ether.fi provides native re-Staking, where Staking rewards are automatically compounded to generate higher returns. This feature helps users maximize their earnings without manual intervention. Ether.fi aims to make Staking in the Ethereum ecosystem more accessible, efficient, and decentralized.
Key Features and Functionalities
One of Ether.fi's key features is the liquid Staking functionality. Users do not need to lock up ETH for an extended period, but instead, receive liquid tokens, such as eETH (ETH Staked on ether.fi), by Staking their ETH. These tokens represent the Staked ETH and can be traded or used in various DeFi applications, providing greater flexibility and liquidity.
How It Works
Seamless Staking, Earn Rewards: Users can Stake their ETH through the Ether.fi protocol. When users Stake their ETH on the Ether.fi protocol, they receive an equivalent amount of liquid tokens (eETH). eETH is a native re-Staked liquid Staking token that entitles its holders to the Staking rewards generated by the underlying Staked ETH, while maintaining liquidity and participating in various DeFi activities.
These rewards are automatically compounded within the Ether.fi protocol, maximizing the earning potential for eETH holders.
Ether.fi employs a liquid Staking mechanism, allowing users to Stake their ETH without long-term lock-ups. Compared to traditional Staking methods, this feature provides users with higher flexibility and liquidity.
Governance Token: ETHFI is the governance token that powers the Ether.fi network. By holding ETHFI tokens, users can vote on proposals, upgrades, or parameter changes, ensuring a decentralized and community-driven governance model that makes the protocol management more inclusive and democratic.
Why Choose Ether.fi?
Ether.fi offers several key advantages for users who want to participate in the decentralized Staking of the Ethereum blockchain, including:
(1) High Liquidity
It allows users to Stake less than 32 ETH with Ether.fi and automatically receive an equivalent amount of eETH or weETH, which are freely tradable tokens that can be quickly converted back to ETH or other crypto assets when liquidity is needed.
(2) Multi-Scenario Applicability
eETH and weETH have ERC-20 token properties, and in addition to earning liquidity pool rewards, they can be used in various DeFi platforms, such as lending, liquidity provision, or as a medium of exchange, expanding the range of operations and potential earnings for users within the Ethereum ecosystem.
(3) Staking Rewards + Re-Staking Earnings
Users can re-Stake their ETH on Ether.fi to protocols like EigenLayer, Symbiotic, and Karak, earning additional Staking rewards. These rewards are automatically accumulated and compounded, generating more earnings for users over time.
With these advantages, Ether.fi aims to make Staking in the Ethereum ecosystem more convenient, efficient, and decentralized, while maximizing Staking rewards for users.
Robust Growth Trajectory
Explosive TVL Growth: As of January 14, 2025, Ether.fi's TVL (Total Value Locked) has reached ~$8.5 billion, making it the 4th largest project in the ETH ecosystem, including L2, with excellent security. It has the highest adoption rate and the fastest growth among all liquid Staking projects.
Reliable Team Background
Ether.fi raised $5.3 million in funding on February 2, 2023, with North Island Ventures, Chapter One, and Node Capital as the lead investors, and BitMEX founder Arthur Hayes as a participant. On February 27, 2024, Ether.fi completed a $27 million Series A round, led by Bullish and CoinFund, demonstrating the protocol's rapid expansion trend and investor confidence.
Ether.fi has currently disclosed information about 5 team members in its official documents, including the founder Mike Silagadze, who is currently the CEO of the DeFi fund company Gadze Finance and the founder of the Canadian higher education platform Top Hat (which raised $130 million in Series E funding in 2021). Considering the successful entrepreneurial experience of Ether.fi's founder, he possesses the knowledge and experience in both corporate operations and the crypto domain, enabling him to efficiently execute and scale Ether.fi, ensuring that its operations and innovations align with the needs of the crypto ecosystem.
Additionally, the Ether.fi team adheres to three guiding principles:
First, decentralization is the primary goal, and they will never compromise on the non-custodial and decentralized nature of the protocol.
Second, Ether.Fi has a sustainable revenue model and will participate in it in the long term, with the team thinking and planning with a long-term perspective.
Third, they are committed to professional ethics and will always do the right thing for the Ethereum community.
Staking Rewards Composition
Ether.fi's Staking rewards are primarily composed of the following elements:
(1) Ethereum Network Staking Rewards: Currently, the Ethereum Staking annual yield is around 2.7%.
(2) Re-Staking Rewards: Ether.fi re-Stakes the users' Staked ETH on protocols like EigenLayer and Symbiotic, earning additional rewards. These rewards may be in the form of the project's own tokens, such as Eigen or ETHFI, or other governance tokens or yield certificates from the participating protocols.
(3) MEV Rewards: On the Ethereum network, nodes can earn fees from the transaction ordering process, including user-provided priority fees and MEV rewards. As a node operator, Ether.fi will share a portion of these transaction ordering rewards with Staking users, but this revenue stream has some uncertainty, depending on the activity and congestion in the Ethereum network.
(4) Liquidity Mining Rewards: After Staking ETH on Ether.fi, users receive corresponding liquid tokens, such as eETH or weETH. These tokens can be used to provide liquidity in other DeFi protocols, earning additional mining rewards, typically in the form of governance tokens or trading fee sharing from the participating DeFi protocols.
(5) Airdrops and Other Incentives: Ether.fi may periodically launch airdrop activities or other incentive measures to attract users to participate in Staking. For example, during a specific period, Staking a certain amount of ETH may increase the airdrop reward pool, giving users the opportunity to receive additional ETHFI tokens or other project-specific airdrop rewards.
Conclusion: Among the mainstream and secure ETH LRT (Liquid Rewards Tokens) options, Ether.fi offers one of the highest yields.
Estimated Regular Staking Rewards
Among the current mainstream ETH Staking protocols, Ether.fi's Symbiotic pool has the highest yield in the network, estimated to reach an APR of 6-10%.
Symbiotic is the largest competitor to EigenLayer, and the Ether.fi x Symbiotic combination can provide four-fold rewards:
- ETH's inherent 2.7% yield;
- Ether.fi tokens;
- Symbiotic tokens;
- Veda tokens.
Note: The above APR calculation factors in the potential value of the aforementioned tokens, and the funds can be flexibly deposited and withdrawn at any time.
You can directly deposit on the Ether.fi frontend, here's the link: https://app.ether.fi/weeths.
Summary
The DeFi application scenario design of Ether.fi's eETH gives it more DeFi application directions and upper-layer yield stacking mechanisms, allowing more users to participate in Ether.fi. Overall, as a derivative product in the LSD track, Ether.fi's design in key management is innovative, and its yield advantage and ease of use have helped it achieve a considerable TVL, making it the best yield place for current ETH.
