Tons-based recycling protocol secures $100M institutional TVL commitment

Utonic, a protocol on the Open Network (TON), has received an institutional commitment of $100 million in Total Value Locked (TVL) ahead of its protocol launch.

The Ton-based relaunch protocol has received $100 million in commitments from organizations including TonStake, iZUMi Finance, InfStones, SatLayer and StakeStone.

According to Utonic founder, Lemon Lin, the protocol aims to contribute to the security and decentralization of TON. Lin told Cointelegraph:

“The reprocessing technology path has been successfully proven by Eigenlayer and others in Ethereum and can be practically practiced on tons to improve security and decentralization.”

Demand for restaking has been fueled by the success of Ethereum-native restaking protocol EigenLayer, which surpassed $1 billion in TVL on December 28, 2023. EigenLayer became the fourth largest repo protocol on February 15, reaching $6.99 billion in TVL.

Reinventing protocols like EigenLayer will allow validators and stakeholders to recycle liquid stakes like Lido Staked ETH and RocketPool's rETH to protect and validate other networks. These assets can be deployed in other Decentralized Finance (DeFi) protocols to generate additional revenue.

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Utonic maintains 20% API even during bear markets.

UTONIC Protocol starts with a profitable Annual Percentage Yield (APY) of up to 30%.

When asked about potential production cuts in bear market conditions, Lin said he expects more than a 20% yield. He explained.

“Native 3.65% API + additional 5-15% API from AVS, expecting farm incentives on L2s, total could be over 30%. Even in a bear market where liquidity on the chain is flowing, we still expect a 20% API.”

Utonic's protocol allows tone resetters to access product from three different sources – native certified product, active verified service (AVS) product and farm incentives.

Through the protocol, users can pay Ton Tokens and convert the carried equivalent to additional applications, such as AVS authentication, to get an additional revenue product at their fingertips.

Utonic plans to go live in late September.

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The need for restoration and liquidity will grow on high-end blockchains

Demand for liquid storage and solutions is on the rise, with EigenLayer's recent growth contributing to the trend.

According to Baybit Research, liquidity at Solana could increase nearly fivefold, to $18 billion, driven by improved liquidity and capital efficiency through retail investor adoption.

Liquid Stake creates greater capital efficiency for investors by providing an equivalent of an initial split token that can be deployed for other DeFi applications.

On Ethereum, liquid staking is the largest protocol category with a combined TVL value of over $39.5 billion.

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