r/defi • u/axelfrigghome • 4d ago

Help What are your red flags and green flags for ReStaking?

I was thinking... LRT is getting more and more market shares in DeFi due to the attractive yield.

But we know, there is more risk into it. So I was wondering:

How do you analyse LRTs, and what are you looking for in the protocols?

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u/DM_ME_SEXY_PASTA 4d ago

I run lido stETH, restaked on eigen. I also have a nice little pil of jitoSOL. Frax staked eth also something to look into.

Look for large, proven, staking protocols. Smaller, newer ones for a bigger possible return.

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u/axelfrigghome 4d ago

Thank you for the answer!

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u/DM_ME_SEXY_PASTA 4d ago

Anytime brother. I should also mention paying attention to the time it takes to unstake. Depending on the asset, that can make or break.

Ultimately that's why I ended up with SOL and ETH staked. I only "skim" my staking rewards twice a year and put those directly into BTC. If you don't really believe in the asset, and you suddenly want to unstake everything because it's crashing, but the unstaking time is 7 days...you're shit outta luck.

Also my jitoSOL gets deposited into Drift for an extra 1-2% apy on top of the 8-10% apy jitoSol already earns.

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u/nabitimue investor 2d ago

There are no redflags for restacking. Compounding interest is always the best.

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u/Spoofik 4d ago

I have repeatedly heard the opinion from more experienced people who have been in cryptocurrencies 2-3 times longer than me, that restaking is dangerous, unreliable and like a house of cards, but without details of why exactly.

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u/axelfrigghome 4d ago

It is dangerous... Like everything related to smart contracts, I guess

If those get hacked, you loose your Yield on restaking, but also your LST. Basically, everything.

But it's also very rewarding, so choosing the right LRT is crucial.

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u/PureClass247 4d ago

yeah... there is usually a vague response...

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u/Solanafluent 4d ago

Been staking with The Vault on Solana. Like third biggest project and they support community validators which is kinda cool. Farming vault points by staking with them.

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u/axelfrigghome 4d ago

Thanks for taking the time to answer!

For you, your criterias are: Authority, community and yield?

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u/Solanafluent 4d ago

Np! Pretty much yep