TL;DR
- Restaked Swell Ether (rswETH) is Swell's native Liquid Restaking Token (LRT)
- rswETH delivers uncapped access to Eigenlayer restaking rewards without the need to lock your liquidity.
- The token has been developed with a focus on security and risk management, and is audited by Sigma Prime.
- rswETH holders will enjoy zero fees for 30 days from the launch.
Swell has launched Restaked Swell Ether (rswETH).
As a native liquid restaking token, rswETH gives you uncapped access to EigenLayer restaking without the need to lock your liquidity.
The token has been audited by leading blockchain security firm Sigma Prime, and its development is supported by expertise from top-tier DeFi risk management firms Gauntlet and Chaos Labs, as well as collaboration with leading Actively Validated Services (AVSs) across the rapidly growing EigenLayer restaking ecosystem.
Why rswETH?
Restakers on EigenLayer confront the same problem that stakers faced before the emergence of Liquid Staking Tokens (LSTs) — they must choose between staking and effectively locking their liquidity, or staying liquid and using their ETH in DeFi.
As a Liquid Restaking Token (LRT), rswETH solves this problem by providing a tokenized version of restaked ETH that represents ETH plus accumulated restaking rewards. This unlocks liquidity, enabling restaked ETH to be traded, transferred, and used in DeFi.
Looking ahead, we expect LRTs to grow in popularity and eventually absorb LSTs. This functionality will be made available in future versions of rswETH, which will enable swETH to be directly restaked into rswETH.
rswETH rewards
By simply holding rswETH you will earn:
- 100% staking yield from the rewards earned by staking your ETH with Swell. rswETH holders will pay zero fees for 30 days from launch.
- Pearls representing your share of the Swell Voyage airdrop. rswETH holders earn the same Pearls as swETH holders. That includes 30 Pearls per minted rswETH, ongoing Pearls for holding rswETH, and ongoing Pearls at a higher rate for using rswETH in approved DeFi protocols. Pearls will be redeemable for $SWELL tokens at the TGE, scheduled for late Q1.
- 100% EigenLayer Restaked Points. Swell passes all the Points earned on EigenLayer directly to restakers.
- Future restaking rewards, when EigenLayer onboards Actively Validated Services to mainnet.
Plus, you will also be able to earn additional yield by using your rswETH in a range of DeFi protocols. These are expected to include Curve, Pendle, ION, and many more.
How rswETH works
rswETH is a yield-bearing token. This means that its value rises over time as staking and restaking rewards accrue.
The rising value is expressed through changes in the exchange rate on the rswETH contract, which keeps track of the relative value of total ETH restaked including rewards, vs the original amount of ETH that has been staked.
Under the hood, the validators for the rswETH restaking pool are pointed directly towards the EigenLayer smart contracts, enabling the ETH to be pledged to secure Actively Validated Services. This makes rswETH a native Liquid Restaking Token (LRT).
rswETH v1
rswETH will evolve alongside EigenLayer.
In version 1, you can deposit ETH to get rswETH, and accrue restaking rewards in the form of Pearls and EigenLayer Restaked Points.
Subsequent versions will introduce additional functionality including withdrawals, the restaking of LSTs including swETH, and restaking rewards for securing the first Actively Validated Services.
Got Questions?
Find answers below, and join the conversation about restaking in our thriving community on Discord, DeBank, and X.
FAQ
What is rswETH?
Restaked Swell Ether (rswETH) is a tokenized version of Ether restaked on EigenLayer.
Technically speaking, rswETH is a native Liquid Restaking Token (LRT).
What is a native Liquid Restaking Token?
As native LRT, rswETH deposits are uncapped.
Under the hood, the Swell DAO validators for rswETH are integrated directly with EigenLayer.
Read more about Native Restaking in the EigenLayer docs.
What is EigenLayer?
EigenLayer is a protocol built on Ethereum that introduces the new cryptoeconomic primitive of restaking.
Restaking on EigenLayer enables stakers to earn additional rewards by securing multiple Actively Validated Services (AVSs), which are protocols that require distributed validation. This includes: oracles, bridges, sidechains, virtual machines, and other systems that need to bootstrap decentralized security in an efficient and effective way.
How are restaking rewards distributed?
rswETH is reward-bearing, which means that it increases in price as staking and restaking rewards accrue.
This can be tracked through the ETH:rswETH exchange rate, which shows the relative value of total restaked ETH including rewards, vs the original amount of ETH that has been restaked.
What will I earn by holding rswETH?
For now, you will earn Pearls and EigenLayer Restaked Points.
- Pearls can be used to claim SWELL tokens at the token generation event (TGE), which is scheduled for late Q1, 2024.
- EigenLayer Restaked Points are a measure of your contribution to the shared security of the EigenLayer ecosystem. Swell passes all points earned on EigenLayer to the restaker.
When EigenLayer onboards Actively Validated Services (AVSs) to mainnet, restaking yields will flow to rswETH holders.
Can I see my EigenLayer Restaked Points in the Swell app?
An estimation of your EigenLayer Restaked Points is visible on the Swell app. Due to the way in which EigenLayer Points are calculated, this estimated number may diverge by up to a few percentage points from the exact figure shown on the EigenLayer app.
Do swETH and rswETH earn the same amount of EigenLayer Points?
Although both swETH and rswETH could be expected to earn roughly the same number of EigenLayer points over long periods, there may be some short-term variance due to a difference in the way that native restaking is set up within EigenLayer.
While swETH restakers start earning Points immediately upon restaking, native restakers (rswETH holders) only start earning points when the validator has been registered on the beacon chain, which can take more than 18 hours. The loss of Point earnings during this period is spread across all holders, resulting in rswETH holders potentially earning slightly fewer Points compared to swETH restakers.
Is there a cap to restaking with rswETH?
There is no limit to the amount of ETH that can be natively restaked on EigenLayer through rswETH.
What are the fees on rswETH?
For the first 30 days following the launch, rswETH holders will pay zero fees. Following this period, fees will be 10%.
Can I use rswETH in DeFi?
Yes, restaking with rswETH enables you to earn restaking rewards while also using your rswETH in DeFi.
The first DeFi integrations will be available in the days following the launch. These will include Curve, Maverick, Pendle, and ION.
Will I earn Pearls with rswETH?
You can collect Pearls with rswETH in the same way as with swETH. That includes ongoing Pearls for holding rswETH and using it in DeFi, along with a bonus of 30 Pearls for each new minted rswETH.
Note that Pearls earnt with rswETH are not yet showing on the Voyage dashboard and will be added in the next few weeks.
Will I get rswETH by restaking swETH on EigenLayer?
No, you will not get rswETH by restaking swETH on EigenLayer.
To get rswETH, you need to restake through the Swell app, which deposits your ETH into a separate restaking pool.
Learn more about the difference between rswETH and restaking swETH in our blog: What is restaking?
Can I withdraw or swap rswETH for ETH?
Withdraws are not yet live for rswETH. This will be enabled in the coming weeks.
Swaps are possible on the secondary market through the use of DEXs or DEX aggregators.
What is the relationship between swETH and rswETH?
swETH and rswETH are complementary and serve different purposes.
In the future, we expect Liquid Restaking Tokens (LRTs) to gradually absorb Liquid Staking Tokens (LSTs). As such, future versions of rswETH will enable swETH to be staked in exchange for rswETH.
Do referrals work with rswETH?
Referrals will be made available for rswETH at a later date.
