Ethereum’s Promise of Extra Yield Falling Short? Five Platforms’ Profits Drop 56%!
As the combined gross profit of five major protocols in the liquid restaking sector—which aims to generate extra yield from the same asset on Ethereum—fell 56% in three quarters, ether.fi is ending its EigenLayer connection and shifting to other products.
According to an analysis by CoinDesk using DefiLlama data, Renzo, Kelp, Swell, Puffer Finance and Bedrock generated a combined $953.350 in gross profit in the second quarter of 2026. Three quarters earlier, the same five protocols had combined gross profit of $2,18 million. Puffer’s gross profit in the latest quarter was $21.590, while Swell’s was $22.370.
The sector’s core problem was that fees from projects buying security services failed to generate the expected extra yield. Declining incentives and the risks borne by users also made this revenue gap more apparent.
Expectations of a second yield from the same Ethereum
Staking involves using ETH to help secure the Ethereum network in return for rewards. Restaking aims to generate additional earnings by also using the same asset to secure other services. Liquid restaking tokens represent the deposited asset, allowing users to sell it or use it as collateral in DeFi applications.
However, data dated September 8 showed that the restaking category, which held $10,02 billion in assets, generated just $99.977 in fees over the previous week. The liquid staking category, with $51,87 billion in assets, generated $27,35 million in fees over the same period. On a per-dollar-secured basis, fee generation in liquid staking was about 53 times higher.
As deposit-incentive points programs declined throughout 2025, slashing—a mechanism introduced on EigenLayer in April 2025 that deducts from the collateral of operators who violate the rules—also made the additional risk more tangible.
Ether.fi streamlined weETH
In August, ether.fi removed restaking from weETH, turning the token into a liquid staking product only. Company documents stated that, as of that month, less than 1% of assets were restaked on EigenLayer, and that the remaining withdrawal permissions were planned to be removed by the end of the year. Users who want to restake have a separate, optional token available through Symbiotic.
CEO Mike Silagadze attributed the decision to leave to the lack of meaningful additional yield opportunities and the risks perceived by users. The company is now focusing on card, borrowing and investment vault products, positioning itself as a crypto neobank.
A strategic shift despite million-dollar profits
What makes this shift notable is that, according to DefiLlama’s calculations, EigenLayer restaking activity generated $2,87 million in gross profit for ether.fi in the second quarter. This was the second-largest contributor, after card activity, which generated $3,14 million in gross profit. By contrast, the company’s total gross profit fell from $18,71 million in the third quarter of 2025 to $9,99 million in the second quarter of 2026.
Silagadze says neobanking revenue fully offsets the revenue lost due to restaking and the low ETH price. This assessment of the company’s revenue diversification is based on a different metric than gross profit data from previous quarters.
At other protocols, a significant share of rewards is passed directly to users. For example, Kelp’s accounts record a $460.600 EIGEN reward as both revenue and an equal amount of expense. This leaves the protocol with no profit from this item; ordinary staking fees beneath the restaking layer bear the weight of the revenue model.