Sreeram Kannan, the project’s leader, had previously remained tight-lipped about any plans for an EIGEN token. However, this didn’t deter crypto traders from betting heavily on the possibility. They poured in over $15 billion in deposits, aiming to reap incentives for early users.
EigenLayer, the restaking protocol that amassed $15.7 billion in deposits, unveiled a whitepaper on Monday confirming its intention to launch an EIGEN token. This announcement is expected to be one of the most eagerly anticipated reward distributions of the year within the Ethereum blockchain ecosystem.
According to a blog post from the Eigen Foundation, the non-profit organization backing the protocol, the total supply of EIGEN tokens will be approximately 1.67 billion. Of this supply, 45% will be allocated to the EigenLayer community, divided into three categories: stakedrops, future community initiatives, and ecosystem development, each receiving 15%.
“The total supply of EIGEN at launch is 1,673,646,668.28466 tokens,” revealed the foundation, attributing this number to encoding the phrase ‘Open Innovation’ onto a classic telephone keypad.
Crypto traders had speculated for months about EigenLayer’s potential token launch and had already deposited funds into the protocol well before its recent launch, anticipating rewards for early participation. EigenLayer, at the forefront of the restaking trend, allows users to repurpose their staked ether (ETH) tokens to secure additional networks or protocols on the Ethereum blockchain.
Led by Sreeram Kannan, who founded the project in 2021 while serving as an associate professor of electrical and computer engineering at the University of Washington, EigenLayer went live earlier this month. However, it has yet to activate most of its core features, including its reward system and critical slashing mechanism.
In Monday’s announcement, the Eigen Foundation detailed plans for the initial stakedrop, where 5% of the token supply will be distributed to users based on their staking activities on March 15. Claiming for these EIGEN tokens will commence on May 10 and remain open for 120 days.
Investors will be allocated 29.5% of the token supply, while 25.5% will go to early contributors. Both groups will undergo a three-year lock period, with full lockup in the first year, followed by a linear unlock of 4% of their total allocation each month over the next two years.
Additionally, users will have the opportunity to secure EigenDA, Eigenlayer’s Actively Validated Service (AVS) for data availability, with their EIGEN tokens upon launch. The foundation also hinted at the introduction of other AVSs in the future.
This restaked ETH collectively secures auxiliary AVS networks on EigenLayer, with the protocol introducing a new technological design called intersubjective forking as part of the EIGEN drop. This feature aims to support intersubjective faults, instances of misbehavior that cannot be objectively identified on-chain but are unanimously recognized as deserving penalties by reasonable observers.
The foundation believes that this system will enable AVSs to make a broader range of credible commitments, significantly expanding the possibilities for what can be built on EigenLayer. Potential use cases include transaction ordering, databases, prediction markets, storage services, oracles, artificial intelligence, and more.
