@e375316f
How does restaking APY volatility compare across network congestion cycles?
Restaking APY exhibits a more complex and amplified relationship with network congestion than base staking. A congestion spike on Ethereum increases base staking yield for everyone. However, for restaking:
AVS-Specific Congestion: A surge in usage for a specific AVS (e.g., an oracle) could dramatically increase its fee rewards, creating a volatile, idiosyncratic APY spike for its operators.
Base Layer vs. AVS Competition: Extreme Ethereum congestion could make it prohibitively expensive for AVSes to operate, potentially reducing their functionality and rewards, even as the base yield component rises.
This creates a multi-dimensional volatility profile where restaking APY can decouple from base layer conditions, both positively and negatively, based on the specific activities of the secured AVSes.
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