What Is Token Restaking?
Token restaking takes tokens already committed to securing a base blockchain and uses them to back secondary decentralized services at the same time.
Pooled security
New decentralized protocols—like oracle networks, bridges, or data availability layers—historically had to launch their own token, find validators to buy and stake it, and build an economic defense layer from scratch. If an oracle network had only $20 million in staked security, an attacker with $21 million could corrupt the feed.
Restaking lets new services rent the existing economic weight of established blockchains like Ethereum or Bitcoin. Instead of building a validator set from zero, the service (an Actively Validated Service, or AVS) accepts delegations of already-staked capital.
How contracts route capital
On Ethereum (such as with EigenLayer), restaking works through smart contract withdrawal credentials:
- Native restaking: A validator points their beacon chain withdrawal credentials to an EigenLayer smart contract (an EigenPod) instead of a personal wallet. The validator continues checking Ethereum blocks as usual, but gives the restaking contract permission to slash their stake if they violate rules on an opt-in service.
- LST restaking: Users deposit Liquid Staking Tokens (like stETH or rETH) directly into restaking vaults. The vault locks the LST and delegates validation rights to an operator.
Where rewards come from
Restaking rewards do not appear from thin air. They come from two sources:
- Service user fees: The service generates revenue (such as rollups paying for data availability or apps paying for oracle feeds) and shares fees with operators and restakers.
- Token incentives: The new service issues its own tokens as early rewards to attract collateral.
If a service lacks real user demand, rewards consist solely of inflationary token printing. In all cases, the extra yield is payment for taking on extra slashing, operator, and smart contract risk.