Ether.fi is a decentralized Ethereum staking protocol that enables users to stake ETH and mint eETH, a liquid staking token that accrues staking rewards, EigenLayer restaking yields, and loyalty incentives. By combining security, composability, and yield optimization, Ether.fi has rapidly emerged as one of the most influential players in the DeFi space—managing over $8.4 billion in total value locked (TVL) across 2.47 million ETH.
Built on a fully decentralized stack, Ether.fi leverages Distributed Validator Technology (DVT) to ensure users retain control over their validator keys while minimizing counterparty risk. It supports permissionless node operation through its Operation Solo Staker initiative, enhancing Ethereum’s network resilience and geographic diversity.
Beyond staking, Ether.fi offers automated yield-generating Liquid Vaults and is backed by ConsenSys, making it one of the first major protocols to combine self-custody, liquid staking tokens, and restaking at scale.
How Ether.fi and eETH Work
Ether.fi operates as a non-custodial staking solution where users can stake ETH while maintaining full ownership of their validator keys. This is achieved through DVT, which splits validator responsibilities among multiple nodes to prevent single points of failure and enhance decentralization.
When users stake ETH on Ether.fi, they receive eETH—a liquid representation of their staked position. Unlike traditional staking, where assets are locked, eETH can be freely used across DeFi protocols while still earning staking rewards.
Here’s how the process works:
- ETH Deposit: Users deposit ETH into the Ether.fi protocol to begin staking.
- Validator Key Management: Keys are generated and encrypted by the user, allowing secure sharing with node operators without surrendering control.
NFT Representation: Each validator is represented by two NFTs:
- T-NFT (Transferable NFT): Represents economic ownership (backed by 30 ETH).
- B-NFT (Binding NFT): Grants operational control (backed by 2 ETH), including monitoring and exit rights.
- Staking & Restaking: The deposited ETH earns consensus-layer rewards from Ethereum staking. Additionally, users can opt into EigenLayer restaking, unlocking extra yield from secured AVSs (Actively Validated Services).
- Liquid Token Minting: Users receive eETH instantly upon deposit, enabling immediate participation in DeFi without waiting for withdrawal activation.
- Decentralized Node Operation: Users can run nodes via permissionless solo staking or partner with trusted operators supported by Ether.fi.
This architecture ensures security, flexibility, and maximum capital efficiency.
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What Are Liquid Vaults?
Ether.fi’s Liquid Vaults are auto-compounding yield engines designed to maximize returns for both ETH and stablecoin holders. Users can deposit assets like eETH, weETH, WETH, USDC, DAI, or USDe into these vaults, and the system automatically deploys capital across top-tier DeFi protocols such as Aave, Pendle, and Uniswap V3.
Powered by Veda’s smart contract framework, the vaults feature built-in risk monitoring, automated rebalancing, and emergency exit mechanisms to protect user funds during volatile market conditions.
Top-Performing Vaults on Ether.fi
- Liquid ETH Yield Vault: Optimizes ETH-based yields using diversified DeFi strategies. Currently offers an 8.2% APY with over $557 million in TVL.
- Market Neutral USD Vault: Focuses on low-risk, diversified strategies for stablecoin deposits. Delivers a competitive 17.9% APY.
- UltraYield Stablecoin Vault: Targets high returns through market-neutral approaches, achieving up to 30% APY under optimal conditions.
These vaults eliminate the need for manual strategy management, making sophisticated yield farming accessible to all users—regardless of experience level.
Ether.fi’s Revenue Model
Ether.fi generates revenue primarily through a 10% fee on staking rewards, distributed as follows:
- 5% to the protocol treasury: Funds ongoing development, audits, and ecosystem growth.
- 5% to node operators: Incentivizes reliable infrastructure maintenance and decentralized participation.
This balanced model supports long-term sustainability while aligning incentives across stakeholders.
Additionally, Ether.fi hosts a node services marketplace, where infrastructure providers (grantees and node operators) offer setup, monitoring, and maintenance services. Revenue from these services is shared between the provider and the protocol, creating a self-sustaining economic loop driven by community participation.
ETHFI Tokenomics
The ETHFI token is the governance asset of the Ether.fi ecosystem, giving holders voting power over protocol upgrades, staking service parameters, treasury allocations, and future feature rollouts.
With a fixed supply of 1 billion ETHFI tokens, only 11.52% were initially circulating at launch. The remaining tokens are allocated to support long-term growth and decentralization.
Initial Token Distribution
- Core Contributors: 23.26% — vested over 3 years to ensure team alignment.
- DAO Treasury: 27.24% — funds protocol development and community grants.
- User Airdrops: 11% — rewards early adopters and active participants.
- Partnerships: 6% — fosters ecosystem collaboration.
- Investors: 32.5% — vested over 2 years.
This structured distribution promotes fairness, decentralization, and sustained community engagement.
Founding Team Behind Ether.fi
Ether.fi was co-founded by Mike Silagadze, who previously built Top Hat—a successful edtech company with over 500 employees and millions of users. He holds a degree in Electrical Engineering from the University of Waterloo and served as a venture partner at Ripple Ventures.
Under his leadership, Ether.fi has assembled a strong technical and operational team:
- Rok Kopp – Chief Customer Officer
- Rupert Klopper – VP of Engineering
- Seongyun Ko – Director of Engineering
- Jozef Vogel – Chief Operating Officer
The team combines deep expertise in blockchain infrastructure, distributed systems, and product-led growth—positioning Ether.fi for continued innovation.
Security & Audits
Security is central to Ether.fi’s design. The protocol has undergone comprehensive audits by leading firms including:
- Nethermind
- Omniscia
- Certik
These audits validate the integrity of its smart contracts and DVT implementation. Combined with open-source code and continuous monitoring, Ether.fi maintains a robust security posture suitable for institutional-grade adoption.
Frequently Asked Questions (FAQ)
Q: What is eETH?
A: eETH is a liquid staking token issued by Ether.fi when you stake ETH. It represents your staked position and accrues rewards in real time while remaining usable in DeFi applications.
Q: Can I unstake my ETH anytime?
A: Yes. While Ethereum’s withdrawal mechanics apply (via official beacon chain processes), eETH provides liquidity so you don’t have to wait—simply trade or use it in DeFi immediately.
Q: How does restaking work on Ether.fi?
A: Ether.fi integrates with EigenLayer to enable restaking of staked ETH. This allows users to earn additional rewards by securing new services (AVSs) without unstaking from Ethereum.
Q: Is Ether.fi non-custodial?
A: Yes. Users retain control of their validator keys through DVT and encryption. No third party can access or control your assets.
Q: Where can I use eETH?
A: eETH is compatible with major DeFi platforms including Aave, Curve, and Pendle, allowing you to lend, swap, or leverage your position seamlessly.
Q: How is Ether.fi different from other LSTs?
A: Unlike many liquid staking solutions, Ether.fi emphasizes decentralization via DVT, self-custody, permissionless node operation, and integrated restaking—all within a single unified interface.
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Final Thoughts
Ether.fi redefines Ethereum staking by merging security, decentralization, and yield maximization into a seamless user experience. With its innovative use of DVT, liquid staking token (eETH), auto-compounding Liquid Vaults, and governance via the ETHFI token, it stands out as a leader in next-generation DeFi infrastructure.
Backed by ConsenSys and led by an experienced team, Ether.fi is well-positioned to drive broader adoption of restaking and liquid staking across the Ethereum ecosystem.
Whether you're a retail investor seeking passive income or an institution prioritizing security and control, Ether.fi offers a compelling solution for unlocking the full potential of staked ETH.
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