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

Utonic, an emerging replication protocol on the Open Network (TON), has received a $100-million institutional commitment at Total Value Locked (TVL).

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 has been proven successful by Eigenlayer and others on Ethereum and can be replicated 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.

Restoring protocols like EigenLayer will allow validators and stakeholders to reclaim liquid assets like Lido Staked ETH (STETH) and Rocket Pool 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 expects to launch 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 and additional 5%–15% API coming from AVS, maintaining farm incentives on L2s, total could be over 30%. Even in a bear market where liquidity on the chain is weakening, 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 will be able to convert the token they carry into additional applications, such as securing AVS, by including Ton Tokens, turning into 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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