What is ether.fi (ETHFI)?

Deep Dive

1. Purpose & Value Proposition

ether.fi solves the custodial risk problem in Ethereum staking by letting users maintain full control of their keys. Its non-custodial delegated staking mechanism allows ETH holders to mint eETH, a liquid token that automatically compounds rewards from Ethereum staking, EigenLayer restaking, and DeFi protocols (CoinMarketCap). This positions ether.fi as a bridge between secure staking and yield optimization, appealing to users seeking both security and flexibility.

2. Technology & Innovation

The protocol introduced weETH, the first native liquid restaking token on Ethereum, which aggregates rewards from multiple layers. By integrating with EigenLayer, eETH holders earn additional yields by securing decentralized services. Partnerships like Superstate’s adoption of weETH as collateral highlight its utility in institutional finance (The Defiant).

3. Tokenomics & Governance

ETHFI serves as the governance token, with a fixed supply of 1 billion. The protocol allocates withdrawal fees and protocol revenue to weekly buybacks, redistributing repurchased tokens to stakers. For example, in May 2025, 105 ETH (~$267,000) was used to buy back 206,000 ETHFI (Crypto.news). This creates deflationary pressure and aligns incentives between users and the protocol.

Conclusion

ether.fi redefines Ethereum staking by prioritizing self-custody, multi-layered rewards, and DeFi interoperability. Its focus on non-custodial solutions and strategic partnerships positions it as a leader in the restaking narrative. Will its emphasis on user-controlled assets drive broader adoption as regulatory scrutiny on custodial platforms intensifies?