Competing with EigenLayer in the re-staking market, the new agreement Symbiotic secured over $1 billion in locked value in less than a month. Symbiotic has also initiated novel re-staking concepts.
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New Front in Re-staking! Lido Co-founder and Paradigm Secretly Back Symbiotic, Competitor to EigenLayer
)
Table of Contents
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Unleashing the True Potential of Governance Tokens
Balancing Governance with Financial Utility
Challenges of Governance Tokens
Tally Protocol’s Solution
Symbiotic’s Role in Governance Re-staking
Enhancing Flexibility and Security
Key Advantages
Real-world Applications of Symbiotic x Tally
Case Study 1: Advancing L2 Infrastructure
Example: Arbitrum Protocol
Case Study 2: Decentralized Security of Interoperable Platforms
Example: Wormhole Protocol
Reshaping Blockchain Governance Frameworks
Unleashing the True Potential of Governance Tokens
Governance tokens have become foundational in blockchain ecosystems, empowering holders to actively participate in decision-making. However, these tokens often face a dilemma: should they be used for governance or treated as financial assets? The Tally Protocol integrates Symbiotic’s shared security framework, offering a solution to maximize the utility of these tokens without compromising their core functions.
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Governance tokens grant holders the power to influence protocol decisions but typically require locking tokens, limiting their financial utility. Token holders must choose between participating in governance or using them as collateral in DeFi applications. This necessitates a system that can maximize token utility while retaining governance rights.
The Tally Protocol addresses this by separating governance voting rights from the financial utility of tokens. This enables token holders to:
Maintain governance rights: continue participating in protocol decisions.
Use tokens as collateral: protect infrastructure networks without losing governance capability.
Unlock economic opportunities: leverage tokens in new financial realms.
Symbiotic aids the Tally Protocol by providing a shared security framework supporting customized re-staking implementations. This benefits various collateral types, including DAO protocol tokens, offering significant advantages to protocols and token holders.
Customizable Security System: Protocols can design tailored security measures.
Increased Returns: Token holders earn additional rewards by contributing to network security.
Layer 2 (L2) solutions require decentralized and secure infrastructure. The Tally Protocol and Symbiotic enable L2 to support its services with native tokens, enhancing network security and decentralization.
Staking: ARB token holders stake their tokens in the Tally Protocol, earning tARB (Tally Liquid Staking Arbitrum tokens).
Collateral: These tokens act as collateral in Symbiotic, supporting network services like L3 chain data availability.
Economic Benefits: ARB token holders earn rewards through staking and can re-stake tokens in Symbiotic, gaining additional value from fees paid on L3 chains.
Interoperability protocols like Wormhole rely on validators and relayers for asset transfers. The Tally Protocol and Symbiotic enhance this setup, particularly Wormhole’s native token transfer (NTT) framework.
Liquid Staking: Create tW (Liquid Staking Wormhole tokens) via the Tally Protocol.
Enhanced Security: tW holders support decentralized guardians and relayers, collaborating with guardians’ networks.
Ecosystem Participation: Wormhole token holders secure their protocol and gain additional revenue from native W staking rewards and supporting services.
By enabling governance re-staking through the Tally Protocol and Symbiotic, critical limitations on DAO token utility are addressed, unlocking new shared security use cases. By separating governance from financial utility, this approach:
Unlocks new value: Token holders access new financial opportunities.
Preserves governance structure: DAOs retain control over their protocols.
Promotes secure infrastructure development: Strengthens the blockchain ecosystem.
As the blockchain space evolves, this innovative solution could influence the future trajectory of decentralized finance and governance, providing a robust foundation for new applications and protocol security enhancements.
Symbiotic
Tally
Further Reading
Lido Now Earns Points! Collaboration Mellow Finance and Symbiotic Enter the stETH Re-staking Market
New Front in Re-staking! Lido Co-founder and Paradigm Secretly Back Symbiotic, Competitor to EigenLayer