Source: CoinMarketCap

Restaking is one of the 2024 crypto narratives that was brought to the limelight by Eigenlayer, a popular Ethereum restaking protocol. Since Eigenlayer came into the spotlight, other Ethereum staking protocols also emerged like Etherfi, Renzo Protocol, Puffer Finance, Pendle, etc. We’ve also seen Bitcoin restaking protocols join the show. Popular examples are Babylon and BounceBit.

Guess you could say Solana restaking was right around the corner. Our focus for today is on Cambrian.

Firstly, it’s worth noting that Cambrian won 4th place in the just concluded Solana Renaissance Hackathon held by Colosseum last month. The results were announced two days ago and Cambrian was among the winners in the Infrastructure track of the hackathon.

Let’s get into it.

What is Cambrian?

Cambrian is a Solana restaking protocol described as a “modular security layer.” The high throughput and low transaction costs which are important benefits that Solana provides make it an easy blockchain option for developers to run dApps/protocols and deploy tokens on. The March Solana meme coin frenzy was proof of this. These dApps and protocols fall under different technological categories like DePIN, AI, zk, etc and many of them simply cannot develop their own security system.

There is a pending need to construct a shared security model that can accommodate the wide range of protocols that the Solana blockchain carries. Restaking is one such security model.

Solana runs on the Proof-of-Stake consensus mechanism, a fact every crypto enthusiast is aware of. What this means is that Solana holders stake (lock) their SOL tokens and validators use these staked tokens to validate the blockchain’s transactions, ensuring the failure of any malicious transaction that could cause harm to other users’ funds. Hence, securing the blockchain.

Cambrian aims to utilize these staked SOL in a way that not only benefits the blockchain but also applications built on the network. Cambrian aims to stand as the middleman enabling staked SOL tokens to be restaked and reused for the service of these applications.

Source: Cambrian's Substack

This approach offers benefits for the applications that’ll be leveraging Cambrian’s restaking service, SOL stakers, the validators involved, and the blockchain at large. Other Solana-based liquid staking tokens (LSTs) like mSOL, jSOL will also be allowed for restaking on Cambrian.

Brief Overview of how Cambrian will operate

Cambrian builds its restaking service on the Solana blockchain.
Applications and layers that Solana’s security will integrate with Cambrian.
Cambrian allows Solana validators.
These validators validate transactions for the Solana blockchain typically using staked SOL.
Stakers can then redelegate (restake) their staked SOL to Cambrian which the protocol allows the validators to reuse for the service of the applications integrated.

Potential Benefits of Restaking

For the applications (dApps):

Better security from Solana blockchain
Reduced cost that’d otherwise be needed to run an independent security model.

For the stakers and validators:

Extra staking yield

For the restaking protocol, Cambrian, in this case:

Payment fees accrued

For the blockchain, Solana, in this instance:

More liquidity
More potential for getting innovative projects launching on the network, AKA bragging rights :)

Cambrian is yet to launch and an interview with Coindesk revealed that the testnet phase will be coming up in a few weeks (this quarter or by Q3). According to the Coindesk interview, the founder of Cambrian, Gennady Evstratov mentioned that the team is currently finalizing a $2.5 million raise to become the Eigenlayer of the Solana ecosystem.

Other Solana Restaking Protocols

Apparently, Cambrian isn’t the only project that has its eyes on Solana restaking. Jito, Solana’s current largest protocol by TVL is reportedly building its restaking service, Coindesk article revealed.

Picasso is also a restaking protocol that enables restaking of already-staked SOL, albeit it offers a different and much broader approach. Picasso allows restaking of multiple assets on various Proof-of-Stake blockchains like Cosmos, not just Solana in a bid to “establish cross-ecosystem pooled security,” as stated in the doc. Think of Picasso as a generalized, yet PoS-focused restaking protocol.

Another Solana restaking layer is Solayer Labs. There is very little public information about this project for now except the team has something cooking.

Restaking is a ground-breaking technological implementation. It not only goes to show the possibilities of blockchain but it gives a better view of how far the blockchain industry has come. From merely using crypto as a means of payment to building infrastructures that intertwine with each other to share resources that are otherwise deemed independent. In as much as the solution proffers many benefits, there are certain risks and concerns involved with restaking.