Liquid restaking tokens (LRTs) are a layer built on top of liquid staking tokens (LSTs) and EigenLayer restaking. They let you earn Ethereum staking yield plus EigenLayer AVS rewards — while receiving a liquid token you can use elsewhere in DeFi.
Quick Recap: The Stack
Ethereum staking: Validators stake 32 ETH to secure Ethereum. They earn ~3–5% APY in staking rewards.
Liquid staking (LSTs): Protocols like Lido (stETH) and Rocket Pool (rETH) let you stake any amount of ETH and receive a liquid token. You earn staking yield while the token remains liquid.
EigenLayer restaking: EigenLayer lets ETH stakers "restake" — use their already-staked ETH as security for additional protocols called AVSes (Actively Validated Services). Restakers earn additional yield from AVSes, but take on additional slashing risk.
Liquid restaking (LRTs): LRT protocols handle EigenLayer restaking on your behalf and give you a liquid token in return. You deposit ETH or an LST → receive an LRT → earn staking + restaking yield + protocol points.
Major LRT Protocols
EtherFi (eETH / weETH) Largest LRT by TVL. eETH is their liquid restaking token; weETH is the wrapped version (non-rebasing, better for DeFi integration). EtherFi is one of the few LRT protocols that also runs its own validators (vertically integrated).
Renzo (ezETH) Renzo delegated early to top EigenLayer operators. ezETH trades at a premium to ETH in some conditions due to points accrual. AIRDROP: Renzo has completed its initial EIGEN + REZ airdrop; ongoing rewards continue for active users.
Kelp DAO (rsETH) Multi-chain LRT protocol. Supports restaking from Ethereum and other chains. rsETH is their liquid restaking token.
Puffer Finance (pufETH) Focuses on permissionless validator running. Anti-slashing technology (SGX-based enclave) reduces risk for node operators. pufETH is their LRT.
Swell (swETH → rswETH) Swell started as an LST (swETH) and added restaking (rswETH). Integration with Pendle for yield trading.
How LRTs Generate Yield
LRT yield comes from multiple sources stacked:
- Ethereum consensus rewards (~3–5% APY) — from validating Ethereum
- EigenLayer AVS rewards — as AVSes launch and pay operators
- Protocol-specific points — most LRT protocols run points programs convertible to airdrops
In practice in 2026, actual AVS revenue is still ramping up. Most LRT yield comes from ETH staking + points programs + EigenLayer EIGEN token emissions.
LRTs in DeFi: The Composability Play
The "LRT meta" in 2026 centers on using LRTs as collateral across DeFi:
- Deposit ETH → receive weETH (EtherFi)
- Deposit weETH into Pendle → buy YT-weETH for boosted points
- Use PT-weETH as collateral on Morpho or Aave to borrow USDC
- Deploy borrowed USDC elsewhere for additional yield
This creates a highly leveraged points farming position. It also creates highly leveraged risk.
The Real Risks
Slashing risk: EigenLayer operators can be slashed for misbehavior on AVSes. LRT protocols try to minimize this by selecting reputable operators, but risk isn't zero.
Smart contract risk: Multiple layers (Ethereum → EigenLayer → LRT protocol → DeFi protocol) means multiple smart contract surfaces. An exploit in any layer could affect your position.
Depeg risk: LRTs can trade below ETH value in stressed conditions (liquidity crunch, mass withdrawals, slashing events). weETH has depegged briefly in the past.
Centralization risk: Many LRT protocols control which EigenLayer operators receive restaked ETH. This is a significant trust assumption.
Liquidity risk: LRT markets are smaller than LST markets. Large exits have price impact.
Should You Use LRTs?
For experienced DeFi users with high risk tolerance: LRTs offer additional yield on ETH with manageable risk if you stick to large protocols (EtherFi, Renzo) and keep position sizes reasonable.
For most users: a simple LST (stETH, jitoSOL on Solana) with no restaking exposure is safer. The additional yield from LRTs doesn't always justify the complexity and risk stack.