Ether.fi splits weETH from restaking as Ethereum rewards debate heats up
In brief
- Ether.fi removed restaking from weETH, leaving it as pure Ethereum staking token
- weETHs token now required for restaking yield and additional rewards access
- Ethereum researchers proposed capping staking rewards at 60M ETH locked, drawing platform criticism
- Ether.fi holds $3.55B deposits, earned $41M Q2 2026 gross revenue
The split between staking and restaking
Restaking puts ether to work a second time, securing other services for extra rewards on top of ordinary staking rewards. The tradeoff is that it doubles the ways a holder can be penalised, since a failure on either system can cost them part of their deposit.
By separating weETH from this higher-risk exposure, Ether.fi lets users choose their risk profile without bundling both strategies. "For current holders: You now have a clearer choice between basic staking exposure and additional restaking exposure depending on your goals," the platform said in a statement.
Rewards debate divides the sector
The split arrives as Ethereum researchers, including one from the Ethereum Foundation, proposed that the network stop paying people to stake once half of all ether is locked up. Under the current setup, the payment never falls to zero no matter how much gets staked, so there is always a reason to stake more. Their proposed fix destroys a growing share of the rewards until the payment disappears entirely at around 60 million ether staked. About a third is staked today.
Ether.fi founder Mike Silagadze was among the proposal's critics, arguing it would push out smaller stakers and weaken the products built on staking rewards, his own among them. The economics of staking platforms depend on predictable yield to attract deposits. A sharp reduction in rewards could upend that model.
Financial performance
Ether.fi has captured roughly $223 million in annualized fees and about $51 million in annualized revenue. In the second quarter, it earned $41 million in gross revenue and nearly $10 million in earnings after rewards and other costs. The platform's scale makes it a key voice in debates over how Ethereum's staking layer should evolve.
Frequently asked questions
What's the difference between staking and restaking?
Staking earns rewards for securing the Ethereum network. Restaking uses the same ether a second time to secure other services for extra yield. The tradeoff is higher risk—a failure on either system can cost part of your deposit.
Why did Ether.fi split weETH into two tokens?
The split lets users choose their risk profile separately. weETH now offers pure staking rewards; weETHs adds restaking exposure. This gives holders a clearer choice without bundling both strategies.
What's the proposed change to Ethereum staking rewards?
Ethereum researchers proposed capping validator rewards so they disappear entirely once 60 million ether is staked (roughly 33% above current levels). Today, rewards never fall to zero, creating infinite incentive to stake more.
