What is Ether.fi (ETHFI)?

Ether.fi tackles one of Ethereum staking's main trade-offs: users often have to choose between earning rewards and keeping their assets liquid. ETHFI is the governance token that sits at the centre of this protocol, giving holders a say in how it evolves. The project went live in March 2024, founded by Mike Silagadze and Rok Kopp. The platform is non-custodial, meaning users do not hand over control of their funds to a third party.

What role does ETHFI play in the ecosystem?

ETHFI lets holders vote on protocol parameters such as fees, treasury management, and the selection of node operators. In the StakeRank system, holding ETHFI can improve a user's standing within the protocol. A portion of protocol revenues flows into a community treasury that ETHFI holders oversee. The token's maximum supply is capped at 1 billion, and no new tokens are minted. ETHFI was distributed in part through community airdrops to encourage broad participation. The token is also tied to the protocol's buyback mechanisms, where part of the revenue supports the ecosystem.

What happens to ETH after it is staked on Ether.fi?

Normally, running an Ethereum validator requires 32 ETH. Ether.fi lowers this barrier so that smaller amounts can be staked as well. The eETH token represents staked ETH and automatically adds rewards to the holder's balance. Users can wrap eETH into weETH, a fixed-supply token, if they need a version that suits certain DeFi integrations. Through EigenLayer, staked assets can also be restaked to secure additional networks. Users retain control of their validator keys, and each validator is represented by an NFT. Distributed validator technology spreads operations across multiple node operators. This design lets the same capital earn rewards across multiple layers without requiring additional deposits.