Karak has a ‘good chance’ to become the next EigenLayer after the EIGEN airdrop disappointment.
The emerging Ethereum blockchain protocol's total value locked (TVL) rose more than 25% to $440 million last week, and industry experts believe it could start eating into EigenLayer's market share.
Following the frenzy surrounding the EigenLayer airdrop, Karak has a “good chance” of becoming the next big blockchain protocol, according to Andy Lean, blockchain expert and author of NFT: From Zero to Hero. He told Cointelegraph.
“Karak supports the rescheduling of a wide range of assets, including ETH, LST, LRT, stablecoins, LP tokens and bundled bitcoins. This difference could attract a wider user base looking for more options than ETH.
In early April, Karak closed a $48 million Series A funding round at a valuation of more than $1 billion, which means more leveraged capacity. In comparison, EigenLayer is valued at $15.7 billion, making it the largest reset protocol on Ethereum.
Related: Crypto on Track to Hit 1B Users by End of 2025 – Analyst
EigenLayer airdrop frustration can lead to TVL failure.
On April 29, EIGEN released a white paper for the upcoming EIGEN token, which banned many jurisdictions from the upcoming climate, including the United States, Canada, and several countries in Africa and Asia.
The decision sparked widespread criticism in the crypto community. Anonymous crypto trader Jay said in an April 29 X post that it could be a huge opportunity for Karak:
“Think Eigen gave Karak a golden opportunity.”
EigenLayer's decision to ban weather participants from key crypto districts could lead to a downturn in TVL as stakeholders look for more profitable alternatives, Lian said. he said:
Farmers and stakeholders who have been looking forward to the EIGEN climate may now look for alternative platforms or protocols. Some may prefer more inclusive airdrop opportunities to transfer their assets to other Diffie projects.
Related: EigenLayer on the brink of a productivity crisis
EigenLayer is a venture capitalist (VC) scam that aims to attract money from unsophisticated retail investors, according to Ran Nunner, a crypto analyst and host of the Crypto Banter podcast. In an April 30 X post, he wrote:
“Early VCs come in at small valuations initially – retail gets $15 billion in revenue. Low blood circulation high [fully diluted valuation] In the beginning – let's shy away from more retail…”
Neuner argued that the climate ban on key non-bank locations, along with the decision to lock up the airdropped EIGEN tokens until the group decides, primarily favors VC investors in the first place.
“Any retail investor who buys this in the first 3 years will be penalized.”
According to Alon Murok, CEO of SSV.Labs, while Karak may be the next leading rescaling protocol, multi-asset rescaling may introduce additional protocol risks compared to EigenLayer. Murrock told Cointelegraph:
“With more complexity comes more risk. EigenLayer has put its eggs in Ethereum's basket because Ethereum is the most secure and battle-tested PoS network and therefore a reliable foundation for collective security.”
Related: Lido Finance Hits 1M Validators, Fuels DeFi Growth
