A year ago, restaking emerged as one of the most talked-about domains in the crypto sphere, with platforms like EigenLayer being touted as the next major innovation.
As we reach mid-2025, the total value locked (TVL) in the sector has seen a decline, and the excitement around point farms has diminished.
Amidst these changes, Ether.fi, the leading player in the market, has maintained its position, assisting users in generating yield through liquid staking tokens (LSTs) that are applicable across the decentralized finance (DeFi) landscape.
Now, Ether.fi is aiming to broaden its horizons, with aspirations to evolve into a neobank tailored for crypto users and companies.
Ether.fi’s Stronghold
Operating out of the Cayman Islands, Ether.fi gained an advantage as one of the pioneers in the liquid restaking field, launching a lucrative points farm where early adopters earned points convertible into future token airdrops.
Within a span of ten weeks beginning in early 2024, staked ETH surged from 45,000 ETH to 808,000 ETH. Currently, Ether.fi boasts 2.58 million staked ETH, while its nearest rival, Renzo, holds approximately 380,000 ETH.
In financial terms, Ether.fi’s TVL stands around $5 billion. This figure has descended from a peak of $9.4 billion in December, primarily due to the falling ETH price rather than any noteworthy exodus of funds.
Ether.fi places a strong emphasis on user engagement to ensure loyalty among its clientele.
“We have a good grasp on probably half our TVL,” Silagadze remarked. “We know who these users are, and we maintain ongoing discussions with them.”
In contrast, Renzo has witnessed an over 60% withdrawal of ETH since last July, with its TVL plummeting from 1 million ETH to 378,000 ETH, according to available data.
Transitioning from Restaking Protocol to Neobank
Silagadze views the restaking offering as a tool to attract users and capital, while the overarching goal is to become a neobank that can compete with established names like Revolut.
“For us, staking was primarily a strategy to build TVL and develop a user base,” Silagadze explained. “Our ultimate aim is to create a comprehensive product suite that enables users to completely transition away from traditional banking and operate on a crypto-native platform.”
In September, Ether.fi launched a “Cash” Visa card on the Scroll network, which Silagadze anticipates will become the central revenue generator for the company.
The term neobank has gained significant traction in the crypto space lately. Lending platform Nexo rebranded itself as a neobank last year, while Dakota stealthily introduced a crypto app aimed at providing banking services to crypto depositors. Additionally, EOS, which gained fame as a smart contract platform in 2017, has shifted its focus to Web3 banking.
Ether.fi plans to integrate three distinct products into a forthcoming mobile app.
This app will encompass three interconnected offerings: Ether.fi stake (the staking protocol), Ether.fi liquid (an automated DeFi strategy manager that optimizes yield through AI), and the Ether.fi cash wallet and credit card.
Although staking companies targeting the U.S. market face challenges due to a lack of clear regulatory guidelines, Ether.fi is optimistic that the crypto-friendly policies of the current administration will facilitate its ability to provide services to American citizens once it acquires the necessary licenses.
“We are on track to activate our staking and cash products for the U.S. market very soon. We’ve even received a legal opinion confirming our ability to do so,” Silagadze stated. Ether.fi is also working towards securing licenses to operate in the European Union and the Cayman Islands where its team is located.
Sentiment Challenges for Ethereum
Ethereum shone brightly during the 2017 bull market and the subsequent ICO craze, remaining the preeminent smart contract chain as DeFi and NFTs fueled the boom from 2020 to 2022.
This time around, however, the Ethereum network has come under fire for its drawn-out development trajectory, as market attention has shifted towards meme coins and faster blockchains such as Solana.
Currently, Ether trades around $1,965, having experienced a 40% drop in value over the past year. In contrast, Solana is priced at $131, having only lost 25% during the same timeframe.
“Some of the negativity is clearly fomented by rival ecosystems. The Solana community is active daily, engaging with investors, allocators, and the media, spreading misinformation about ether,” Silagadze commented.
“When you break down those arguments, they don’t hold up. Yet those memes are circulating and they do influence sentiment.”