L2 Native Restaking
Overview
In collaboration with Connext Network, Renzo Protocol is bringing cross-chain Native Restaking to layer 2 networks.
ETH/wETH holders can now restake on leading layer 2 chains partnered with Renzo, enhancing liquidity and accessibility, while mitigating the complexities associated with traditional restaking methods. In the future, Renzo with Connext will also support LST restaking on layer 2s.
Renzo's integration with Connext and Chainlink's Cross-Chain Interoperability Protocol (CCIP) facilitates true cross-chain Native Restaking, ensuring a seamless user experience.
Here's how it works:
User Interaction: Initiate the process by sending ETH/wETH into the xRenzoDeposit contract on L2
Minting $ezETH: The xRenzoDeposit contract mints $ezETH tokens and converts ETH/wETH deposits into nextETH.
Distribution to User: The minted $ezETH tokens are sent back to the user.
Bridge Trigger: Periodically, the xRenzoDeposit contract triggers a bridge transaction through Connext. This action sends all deposited ETH/wETH to the xRenzoBridge contract on Ethereum mainnet.
Bridge Deposit: The xRenzoBridge contract's bridgeDeposit() function unwraps the received nextWETH to ETH and deposits it into the RestakeManager.
Wrapping $ezETH: The RestakeManager then sends the minted $ezETH tokens to the Lockbox contract to be wrapped.
Minting $ezETH: The Lockbox contract mints $ezETH tokens on the layer 2 in exchange for $ezETH on the layer 1.
Burning $ezETH: The xRenzoBridge contract receives the $ezETH tokens and burns them.
CCIP Integration: Periodically, the xRenzoBridge sends the current price of $ezETH to ETH using Chainlink's CCIP. This ensures up-to-date pricing information for the $ezETH token.
Cost Breakdown for Cross-Chain Native Restaking with Connext
| Gas to Run Tx | Bridge Fee | Bridge Gas Fee | Slippage to Convert |
|---|---|---|---|
Variable | 5 basis points | 5 basis points | Variable % |
Example: User deposits 1 ETH, slippage is incurred to convert the ETH/wETH to nextWETH. A fee of 0.0005 ETH (5 basis points) is deducted to pay bridge fee. An additional 5 basis points bridge gas fee or .0005 ETH will be deducted, this fee is used to pay the bridging gas fees to deposit on the L1.
Deposits may experience slippage, calculated based on the quantity of ETH or wETH deposited into the bridge deposit contract. Gas savings may cover the entirety of the slippage amount, depending on the deposit amount.
Native Restaking Benefits:
Simplified User Experience: Native restaking eliminates the complexities associated with managing bridge transactions and fees, offering users a streamlined and user-friendly staking experience.
Lower Transaction Costs: By restaking directly from layer 2 networks or EVM-compatible layer 1 chains, users benefit from significantly lower transaction costs compared to traditional Ethereum mainnet transactions, enhancing accessibility and participation.
Restake Now!
Experience cost efficient native cross-chain restaking on Rezno, powered by Connext.
| Chain | Bridge Link | Smart Contracts |
|---|---|---|
Arbitrum | ||
Base | ||
Blast | ||
BNB Chain | ||
Mode | ||
Linea |
About Connext
Connext is a modular interoperability protocol for securely passing funds and data between chains. Developers can use Connext to build cross-chain apps that interact with multiple blockchains or rollups simultaneously. Connext is built with three core design principles: modularity, security, and simplicity. Using Connext, developers can create web3 applications that securely interact with users, tokens, and other applications on any chain.
Learn more about Connext Network: Connext Website
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