Utonic, a rising restaking protocol built on The Open Network (TON), has secured a $100 million institutional commitment in total value locked (TVL) ahead of its protocol launch. The commitment comes from firms such as Mirana Ventures and Foresight Ventures.
The main objective of the protocol is to enhance TON’s security and decentralization, as stated by Utonic co-founder Lemon Lin. Lin explained to Cointelegraph that the interest in restaking was sparked by the success of EigenLayer, an Ethereum-native restaking protocol that surpassed $1 billion in TVL on December 28, 2023. EigenLayer quickly became the fourth-largest restaking protocol, reaching a TVL of $6.99 billion by February 15.
Restaking protocols like EigenLayer allow validators and stakers to restake liquid staking derivative tokens, such as Lido Staked ETH (STETH) and RocketPool’s rETH, in order to secure and validate other networks. These assets can also be utilized in other decentralized finance (DeFi) protocols to earn additional yield.
Utonic anticipates offering an annual percentage yield (APY) of up to 30% when it launches. Even during bear market conditions, Utonic expects the yield to be over 20%. According to Lin, the Utonic protocol enables TON restakers to earn yield from three different sources: native validator yield, Actively Validated Services (AVS) yield, and farming incentives. Users will be able to stake TON tokens and reallocate the equivalent staked amount to additional applications, such as securing AVS, in exchange for passive yield on their holdings.
Utonic is set to go live at the end of September.
Interest in restaking and liquid staking solutions has been growing across various blockchains, with EigenLayer’s recent success contributing to this trend. Bybit Research predicts that liquid staking on Solana could experience a nearly five-fold increase, reaching $18 billion, due to increased adoption by retail investors driven by improved liquidity and capital efficiency.
Liquid staking offers investors more capital efficiency by providing an equivalent token that can be deployed in other DeFi applications. On Ethereum, liquid staking is the largest protocol category, with a combined TVL of over $39.5 billion.
A proposed change is being considered to save Ethereum from a potentially problematic L2 roadmap.