Coinbase Lists Pre-Launch Ethereum Restaking Protocol Valued at $12.2 Billion
Coinbase has recently listed the Ethereum (ETH) restocking protocol project, EigenLayer (EIGEN), for pre-launch trading.
Coinbase has recently listed the Ethereum (ETH) restocking protocol project, EigenLayer (EIGEN), for pre-launch trading.
This announcement was made on Coinbase’s social media platform, X, confirming that EIGEN is now open for trading ahead of its official launch on Coinbase’s International Exchange and Coinbase Advanced.
This listing is specifically for users in eligible jurisdictions outside the US, UK, and Canada.
According to Coinbase, “You can now trade EIGEN-PERP with up to 2x leverage. EIGEN opens with a price of $7.307 and an Implied FDV of $12.2 billion.”
New pre-launch listing is now available to trade on Coinbase Advanced.
You can now trade EIGEN-PERP with up to 2X leverage.
EIGEN opens with a price of $7.307 and an Implied FDV of $12.2B pic.twitter.com/lLVYm1aYj6
— Coinbase Traders (@coinbasetraders) June 18, 2024
How EigenLayer Works and Its Benefits
EigenLayer allows ETH holders to re-stake their tokens as “cryptoeconomic security” for protocols other than Ethereum.
This provides protocol fees and rewards. For instance, if you staked $100 of ETH for 10 years at a rate of 5%, you would end up with $127.
Why is Tenzor removing liquidity from Eigenlayer and deploying capital in its competitors?@eigenlayer idea is a game-changer as it allows ETH holders to earn money by validating not only Ethereum but also other protocols, making ETH a supercharged productive asset. But there's…
— Tenzor Capital (@tenzorcapital) June 7, 2024
However, if you re-staked the original ETH for use in two protocols over the same period at the same rate, your total would increase to $154.
This system essentially leverages the same amount of ETH to gain higher returns by participating in multiple protocols.
Pre-Launch Trading on Coinbase
Coinbase’s pre-launch trading feature is a novel addition, allowing users to trade perpetual futures contracts on tokens that have yet to be launched. Once the underlying token is officially launched on spot exchanges, the instrument transitions to a standard perpetual contract.
Accepted collateral/margins for these trades include USDC, BTC, and ETH, with a minimum order size of 10 USDC. Coinbase emphasized the risks associated with trading pre-launch digital assets, urging users to fully understand these risks before engaging in such trades.
Impact on the Cryptocurrency Market
The listing of EigenLayer’s restocking protocol on Coinbase for pre-launch trading represents a significant advancement in the cryptocurrency market.
This move offers traders the opportunity to engage in futures contracts on tokens that have yet to be launched, reflecting a growing acceptance and integration of Ethereum-based protocols within the broader digital asset ecosystem.
The introduction of pre-launch trading on Coinbase could set a precedent for other exchanges, potentially expanding trading options available to cryptocurrency investors.
Conclusion
While the opportunity for pre-launch trading on platforms like Coinbase presents exciting possibilities, traders must heed the exchange’s warnings. As highlighted by Coinbase, “Pre-launch trading involves substantial risks, and users should ensure they fully understand these risks before participating.”
This new feature not only enhances the trading landscape but also requires careful consideration and a thorough understanding of the associated risks. As the market evolves, such innovations could pave the way for greater flexibility and options in cryptocurrency trading, provided that investors remain vigilant and informed.
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