In the past two days, EigenLayer, the pioneer in the stake (restaking) field, has successively announced two major moves regarding the EIGEN Token.

· The Season 2 Airdrop is now open for claiming, and the claiming window will remain open until March 16, 2025.

· The second is to launch Programmatic Incentives V1, which will distribute EIGEN incentives to qualified stakers and operating Nodes on a weekly basis starting from October (with historical behavior tracing back to August 15). It is expected to distribute approximately 66.95 million EIGEN in the first year, equivalent to 4% of the initial supply of EIGEN.

For some of the users who follow EigenLayer, the sudden acceleration of EigenLayer's rhythm is to preheat the upcoming 'EIGEN unlock' event, in order to win more market following and participation after EIGEN officially circulates.

On May 10th this year, EigenLayer opened the Season 1 Airdrop application. However, since the application, EIGEN Token has been in a non-transferable state. This somewhat suspenseful behavior has also prevented EigenLayer from gaining the level of discussion it deserves on the Secondary Market.

When will EIGEN be unlocked?

Regarding the unlocking time of EIGEN, it needs to be emphasized that there has been a long-standing misconception in the market that the circulation unlocking time is September 30th.

The reason for the misconception is that the Eigen Foundation mentioned the date of September 30th in its official documentation regarding the unlocking timeline in May, but if you look closely at the description of the Eigen Foundation, you will find that the description is actually: "Earlier this week, we announced that ElGEN will unlock after new features are live and further decentralization is achieved, but we did not announce a specific date. To clarify the timeline, we plan to implement these features on the Mainnet before September 30, 2024."

From the description of the Eigen Foundation, the unlocking of EIGEN's transfer function should be after the implementation of "new functions and further decentralization", and September 30th is the expected time set by EigenLayer for the implementation of "new functions and further decentralization".

Regarding the progress of 'launching new features and further Decentralization,' 'launching new features' is a relatively subjective concept. After May, EigenLayer has successively launched functions such as 'AVS rewards' and 'programmatic incentives,' but it is difficult for external parties to assess EigenLayer's progress. As for the progress of 'further Decentralization,' it is relatively measurable. The first season Airdrop of EigenLayer has ended, with a final claiming rate of approximately 78.6%. The second season Airdrop and subsequent incentive plans will further accelerate the distribution of EIGEN Tokens.

All in all, the official EigenLayer did not mention the unlocking of the transfer function of EIGEN on September 30th, but combined with the progress of 'further Decentralization,' I personally predict that the final unlocking time of EIGEN will not be too long after the second quarter airdrop and incentive plan open.

EigenLayer Basic Data and Valuation Expectations

DeFillama data shows that EigenLayer's current TVL is reported at $10.79 billion, ranking third among all protocols in the ecosystem, only behind liquidity stake giant Lido and lending leader Aave.

The official data from EigenLayer shows that the protocol currently supports 16 AVSs (Active Verification Services), including EigenDA, covering a wide range of services such as DA, Oracle Machine, privacy, DePin, games, ZK verification, etc. Although Symbiotic, Karak, Solayer, Jito and other major stake protocols from different ecosystems are emerging fiercely, EigenLayer still remains the largest in terms of value, fastest in development progress, and strongest in network effects in the entire stake track for now.

The emphasis on 'network effect' is particularly strong because in addition to its own strong fundamental performance, EigenLayer has almost single-handedly driven a large part of the Ethereum ecosystem innovation, surrounding various areas such as Liquidity, stake, and tangible AVS services. A large number of projects, including ether.fi, Renzo, Puffer, Eigenpie, AltLayer, Omni, eoracle, have found their own protocol use cases, depending on the development of EigenLayer.

This is also why the community used to joke that EigenLayer was the "Guardian" of ETH Block and the "Grand Tutor" of the "Emperor"...

In terms of valuation, although the transfer function of EIGEN has not been activated at present, some pre-market trading markets including Aevo have launched EIGEN's Contract Trading. As of the time of writing, EIGEN is temporarily quoted at $2.95 on Aevo.

Due to the total supply of EIGEN at genesis being 1.67 billion, a price of $2.95 implies an FDV of approximately $4.9265 billion for EigenLayer.

As for the initial circulating Market Cap, EigenLayer has not yet disclosed the initial circulation structure of EIGEN, but we can make a simple calculation of the user's Holdings based on the data of two Airdrops (excluding the incentive plan because it will only start to be distributed weekly in October and the early circulation ratio is relatively small). In the first season of Airdrop, a total of about 87.89 million EIGEN were claimed (with a claim rate of about 78.6%); In the second season of Airdrop, a total of 86 million EIGEN will be distributed (60 million EIGEN will be distributed to stakers and operating Nodes, 10 million EIGEN will be distributed to ecological partners, and 6 million EIGEN will be distributed to community contributors). If the claim rate is the same as that of the first season, the final claimed amount is expected to be 67.59 million, and the total claimed amount for the two seasons will be 155 million EIGEN.

This means that the total value of EIGEN obtained by all users through the two-season airdrop is approximately $457 million, which is also the confirmed fully circulating EIGEN shares.

Will there be Airdrops in the future?

When announcing the first season Airdrop earlier this year, EigenLayer mentioned that 15% of the EIGEN Token will be distributed in the form of Airdrop. The planned distribution for the first and second season Airdrops is 113 million and 86 million EIGEN respectively, totaling approximately 200 million EIGEN, accounting for about 11.9% of the total supply of 1.67 billion EIGEN tokens.

This means that within the planning of EigenLayer, about 3.1% of EIGEN Tokens will still be used for future Airdrop rounds.

From the perspective of individual participation, considering that the second round of Airdrop did not adopt the 'everyone gets a share' plan with a minimum of 100 tokens like the first round Airdrop, the Airdrop share that small stakers can get is relatively small (after all, the base is too large). The larger shares of Airdrop are basically allocated to Whale users, operational Nodes, and community contributors - especially KOLs who have previously created high-quality EigenLayer-related content on social media, generally receiving thousands or even tens of thousands of EIGEN Airdrop tokens.

Therefore, small retail investors who continue to stake on EigenLayer for the purpose of receiving Airdrops in future rounds may no longer have ideal profit expectations, unless they choose alternative participation methods with higher barriers to entry, such as creating original content.

Incentive program launched, what is the expected return?

In addition to the Airdrop, another way to directly earn GEN is the upcoming incentive program, which aims to distribute GEN incentives to eligible stakers and operating Nodes on a weekly basis starting in October.

EigenLayer officials stated that the incentive measures will implement retrospective rewards based on the staking situation since August 15, 2024, and the initial rewards will be available for claiming weekly from October. In the first year of the plan's implementation, it is expected to allocate approximately 6695 EIGEN, equivalent to 4% of the initial supply of EIGEN Tokens.

Combining the above data, we can simply calculate the potential yield situation of the stake users in this incentive plan.

First of all, the distribution of the incentive plan is aimed at two groups: stakers and operating nodes, but EigenLayer has not clearly allocated the proportion to the two groups. Therefore, we chose to refer to the allocation ratio of stakers and operating nodes in EigenLayer's design of the second Airdrop. As shown in the figure below, EigenLayer allocated 3.68% of EIGEN to stakers and 0.52% of EIGEN to operating nodes in the second Airdrop, and the allocation ratio of the two groups is roughly 88:12.

Based on this calculation, it is expected that out of a total incentive share of 6695 EIGEN in the first year, approximately 58.91 million EIGEN tokens will be distributed to stake users, which, at a price of $2.95, is approximately $174 million. As mentioned earlier, EigenLayer's current TVL is reported to be $10.79 billion, which means that the potential return for stake users under this incentive plan is estimated to be 1.6%.

It should be emphasized that the above calculations are based on subjective allocation forecasts and rough calculations made by static currency prices, and the final yield situation is still subject to the actual progress of EigenLayer**. Although the yield of 1.6% does not seem objective, EigenLayer stake users are mainly composed of large capital users who tend to be on the left side of "security/income", and they will pay more attention to the security level of the protocol itself and the status of Liquidity. On this basis, considering that EigenLayer itself can also provide about 3% of the native stake income, coupled with the expectation of EIGEN's appreciation, the stake on top of EigenLayer still has a certain financial attractiveness.

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