Definition
LRT, short for Liquid Restaking Token, is a tokenized representation of a restaked asset within a restaking framework such as EigenLayer. It encodes a user’s claim on the underlying restaked collateral and its associated rewards, while remaining freely transferable across DeFi protocols. As a conceptual primitive, an LRT extends the idea of a Restaking Token by emphasizing liquidity, fungibility, and composability on-chain. It is typically issued by a restaking protocol or middleware layer that manages validator delegation, reward accounting, and risk parameters on behalf of depositors.
An LRT abstracts away the operational complexity of Restaking while preserving the economic exposure to the underlying validator set and Actively Validated Services (AVSs). The token’s value is generally backed by the restaked collateral plus accrued rewards, minus any penalties or slashing that may occur. Because it is liquid, an LRT can be integrated into Yield Farming strategies or other DeFi primitives that seek to generate Real Yield from protocol fees rather than purely inflationary emissions. Conceptually, LRTs sit at the intersection of staking, restaking, and capital-efficient collateral design in decentralized finance.
Context and Usage
Within the EigenLayer ecosystem, an LRT functions as a higher-order Restaking Token that can be used as collateral, traded, or composed into structured DeFi products. It allows restakers to maintain exposure to EigenLayer’s reward streams while avoiding the capital lock-up that would occur with non-transferable restaked positions. The design of an LRT typically encodes specific risk profiles, such as which AVSs the underlying stake secures and what slashing conditions apply.
In broader DeFi, LRTs are treated as yield-bearing assets whose return profile is linked to restaking economics rather than only base-layer staking rewards. They can be integrated into liquidity pools, lending markets, or structured Yield Farming vaults that aim to extract Real Yield from protocol-level fees and AVS payments. As a concept, LRTs highlight the trend toward modular security and the financialization of restaked collateral, enabling more granular risk segmentation and capital allocation across the restaking stack.