Ethereum staking has evolved far beyond simply locking up ETH to earn passive rewards. With the rise of restaking and liquid staking derivatives, protocols like Ether.fi are redefining how users interact with their staked assets. Ether.fi is a decentralized platform that combines liquid staking, restaking, and automated yield strategies into a seamless experience — all while prioritizing security, decentralization, and user control.
At its core, Ether.fi enables users to stake ETH and receive eETH, a liquid staking token that represents ownership of staked ETH while remaining fully usable across DeFi. Unlike traditional staking, where assets are locked, eETH allows users to maintain liquidity and earn multiple yield streams simultaneously.
How Ether.fi Works: Staking with Full Control
Ether.fi operates as a non-custodial staking protocol, meaning users retain control over their validator keys — a critical feature for decentralization and security. This is achieved through Distributed Validator Technology (DVT), which splits validator responsibilities among multiple node operators, reducing the risk of downtime or slashing.
When users deposit ETH into Ether.fi, the following process unfolds:
- ETH Deposit: Users send ETH to the protocol’s smart contracts.
- Validator Key Generation: Users generate their own BLS keys locally, which are then encrypted and shared securely with trusted node operators.
NFT-Based Validator Representation: Each validator is represented by two NFTs:
- T-NFT (Transferable NFT): Represents economic ownership of 30 ETH.
- B-NFT (Bonded NFT): Grants operational control (e.g., monitoring, exiting) and requires a 2 ETH bond.
- Staking & Restaking: The deposited ETH is staked on Ethereum and optionally restaked via EigenLayer, unlocking additional yield from AVSs (Actively Validated Services).
- eETH Minting: In return, users receive eETH — a liquid token that accrues staking and restaking rewards in real time.
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This architecture ensures that no single party controls the validator, minimizing counterparty risk while enabling permissionless participation through initiatives like Operation Solo Staker, which allows individuals to run their own nodes without requiring 32 ETH upfront.
What Is eETH? The Liquid Staking Token Powering DeFi
eETH is Ether.fi’s liquid staking token, designed to unlock the full potential of staked ETH. When you stake with Ether.fi, you don’t just earn standard Ethereum consensus layer rewards — you also gain exposure to restaking yields from EigenLayer and potential loyalty incentives.
Because eETH is fully composable, it can be used across decentralized finance (DeFi) platforms for lending, borrowing, trading, or yield farming. For example:
- Deposit eETH into Aave to borrow stablecoins.
- Provide liquidity on Uniswap V3 using eETH/WETH pairs.
- Stake eETH in Pendle to earn boosted yields through yield-tokenized strategies.
This flexibility makes eETH more than just a staking receipt — it's an income-generating asset that stays active in the ecosystem.
Liquid Vaults: Automated Yield Optimization
One of Ether.fi’s standout features is its Liquid Vaults, which automate complex DeFi strategies to maximize returns with minimal user input. These vaults accept deposits in eETH, weETH, WETH, and major stablecoins like USDC, DAI, and USDe.
Funds are dynamically allocated across top-tier DeFi protocols such as AAVE, Pendle, and Uniswap V3, using smart contract logic built on Veda’s architecture. This framework includes automated risk monitoring and programmatic exits during volatile market conditions.
Popular Liquid Vaults on Ether.fi
- Liquid ETH Yield Vault: Delivers up to 8.2% APY by optimizing yield across lending and liquidity provision. Currently holds over $557 million in TVL.
- Market-Neutral USD Vault: Offers 17.9% APY through diversified stablecoin strategies with low correlation to crypto markets.
- UltraYield Stablecoin Vault: Targets 30% APY using advanced market-neutral strategies focused on capital efficiency and compounding.
These vaults are ideal for users seeking hands-off exposure to high-performing DeFi strategies without managing positions manually.
👉 Learn how automated vaults can boost your crypto returns effortlessly.
Revenue Model: Sustainable Growth Through Shared Incentives
Ether.fi generates revenue through a transparent fee structure tied directly to staking rewards:
A 10% commission is applied to all staking rewards earned by users.
- 5% goes to the protocol treasury to fund development and governance.
- 5% is distributed to node operators as an incentive for maintaining reliable infrastructure.
Additionally, the platform hosts a node services marketplace, where stakers can connect with professional node operators. Service fees from these interactions are shared between participants and the protocol, creating a self-sustaining economic loop that aligns incentives across stakeholders.
ETHFI Tokenomics: Governance and Long-Term Vision
The ETHFI token is the native utility and governance token of the Ether.fi ecosystem. With a fixed supply of 1 billion tokens, ETHFI empowers holders to vote on key decisions such as protocol upgrades, fee adjustments, and treasury allocations.
Initial token distribution at launch was structured as follows:
- DAO Treasury: 27.24% — Reserved for protocol development and community initiatives.
- Core Contributors: 23.26% — Vested over three years to ensure long-term commitment.
- Investors: 32.5% — Released gradually over two years.
- User Airdrops: 11% — Rewarded to early adopters and active participants.
- Partnerships: 6% — Allocated for ecosystem collaborations.
This balanced allocation supports decentralization while incentivizing early contributors and ensuring sustainable growth.
Founding Team and Leadership
Ether.fi was co-founded by Mike Silagadze, CEO and former founder of Top Hat, an education technology company serving millions of users globally. With a background in electrical engineering and venture investing (as a venture partner at Ripple Ventures), Silagadze brings strong technical and business leadership to the project.
The executive team includes seasoned professionals such as:
- Rok Kopp – Chief Customer Officer
- Rupert Klopper – VP of Engineering
- Seongyun Ko – Director of Engineering
- Jozef Vogel – COO
Together, they bring deep expertise in software development, product design, and decentralized systems.
Frequently Asked Questions (FAQ)
What is the difference between eETH and staked ETH?
eETH is a liquid staking token that represents staked ETH but remains usable in DeFi. Unlike native staked ETH (which is locked until withdrawals are enabled), eETH accrues rewards in real time and can be traded or used as collateral.
Can I unstake my ETH anytime with Ether.fi?
Yes. While Ethereum-level withdrawals depend on network conditions, Ether.fi allows you to trade or swap eETH instantly on decentralized exchanges, providing immediate liquidity.
How does restaking work on Ether.fi?
When you stake ETH via Ether.fi, your deposit can be restaked through EigenLayer, allowing you to secure additional networks (AVSs) and earn extra yield beyond basic Ethereum staking rewards.
Is Ether.fi safe?
Yes. The protocol uses DVT for enhanced validator security, allows user-controlled keys, and undergoes regular audits. Its open-source code and transparent operations further increase trust.
What are the risks of using Liquid Vaults?
While Liquid Vaults use risk-mitigated strategies, they are exposed to smart contract risk, impermanent loss (in LP vaults), and market volatility. Always assess your risk tolerance before depositing.
How do I get ETHFI tokens?
ETHFI tokens were distributed via user airdrops at launch. New tokens are released over time through governance decisions, liquidity mining programs, or ecosystem incentives.
With over $8 billion in total value locked (TVL), Ether.fi ranks among the largest DeFi protocols by assets under management. Its combination of secure staking infrastructure, innovative yield products, and community-driven governance positions it as a leading player in the next generation of Ethereum-based finance.
👉 Start earning yield on your Ethereum with cutting-edge staking solutions now.