In the early days of Bitcoin, many questioned the value and potential applications of securing money with proof-of-work. However, as more security was added to the network through increased mining, new higher-value use cases became possible - from buying pizza to securing over a trillion dollars in value. The security enabled the applications, not vice versa.
Similarly, as Ethereum's proof-of-work and later proof-of-stake security grew, it enabled valuable new applications like stablecoins, NFTs, and entire L2 ecosystems to be built on top of its economic security. Again, the applications were unlocked by the available security. It’s not possible to build a multibillion dollar stable coin on top of a multimillion dollar network. It was a requirement that the network first reach the security of billions before billion dollar applications could be built.
(re)staking introduces the concept of allowing Ethereum stakers to opt into providing validation and security to other protocols and modules beyond Ethereum execution, such as data availability layers, oracles, bridges, etc. This makes Ethereum's robust security available to a much wider range of potential applications.
Some question what these applications will be and whether there is demand for this security. But this parallels early skepticism of Bitcoin and Ethereum's security. Just as Bitcoin and Ethereum unlocked waves of innovation as their security grew, (re)staking massively expands the design space for what can be securely built by using collateral as security.
In this view, betting against demand emerging for restaked security is betting against the continued growth and evolution of crypto itself. While the exact applications are in the process of being built, (re)staking represents a natural progression in extending blockchain security to enable a new scale of innovation, just as Bitcoin and Ethereum did before it. Potential applications include hyperscale data availability layers, decentralized sequencers, light-node bridges, oracles, MEV management solutions, decentralized automation and more.
By rethinking blockchain security as a service that can be borrowed, repackaged and reused through techniques like (re)staking, the aim is to accelerate crypto's evolution, making its most powerful economic security models available as an open platform to unlock the next generations of decentralized applications and protocols. While uncertain, realizing this potential could expand crypto's horizons as significantly as the emergence of programmable blockchains like Ethereum did in enabling the current ecosystem to flourish.
The foresight to recognize Bitcoin's potential early on proved immensely rewarding for early adopters. Those who saw beyond the initial skepticism and grasped the implications of Bitcoin's growing security infrastructure reaped extraordinary benefits. In a similar vein, early adopters of (re)staking technology stand at a comparable frontier today. By recognizing the potential of repurposing economic security for a multitude of new applications, these pioneers will position themselves to capture value on a scale reminiscent of Bitcoin's early days, as (re)staking will unlock an entirely new ecosystem of secure, decentralized services.
In many ways, betting against (re)staking is essentially a belief that we've reached a maximum in terms of the growth opportunity and applicability of blockchain security. This stance seems shortsighted when we consider that the goal of blockchain is to create a source of security that is not dependent on the state’s monopoly on violence for enforcement. While crypto has come a long way since Satoshi’s whitepaper, we’ve still barely made a dent in the state's monopoly of security through violence. Why stop believing now?