EigenLayer, an Ethereum restaking protocol, experienced a surge in inflows totaling approximately $157 million in Lido's staked ETH within the last 24 hours. This influx marks the highest recorded inflow of digital assets on the platform since February. Interestingly, EigenLayer's significant uptick in activity coincides with Lido's dwindling share of the Ethereum staking market, falling below 30% due to outflows into alternative restaking protocols.

On April 16, EigenLayer made a pivotal announcement regarding the removal of caps on all ETH liquid staking tokens (LST) and the resumption of restaking deposits. This decision signifies a critical juncture for EigenLayer's ecosystem, aiming to cultivate an open market environment conducive to innovation while providing users with unrestricted access to all LST pools. Previously, EigenLayer had imposed caps as a measure to enhance decentralization and mitigate the risk of dominance by any singular token. However, the removal of caps is accompanied by a governance participation limit of 33% for any liquid-staked token, emphasizing the protocol's commitment to neutrality and decentralization.

Despite recent fluctuations in the market, EigenLayer maintains its position as the predominant protocol within the restaking sector, commanding an overwhelming 99% market share. According to data from DeFillama, the platform currently hosts approximately 4 million ETH, valued at over $12.2 billion.

However, amidst EigenLayer's ascendancy, Lido has experienced a notable decline in dominance within the staking landscape. Analysis from a Dune Analytics dashboard curated by Dragonfly analyst Hildobby reveals that Lido witnessed the largest outflow among staking platforms in the past month, totaling nearly 400,000 ETH and reducing its market share to 28.87%. In contrast, liquid restaking protocols such as Ether.fi and Renzo attracted over 700,000 ETH to their platforms during the same period.

Market observers attribute Lido's decline to intensified competition within the liquid staking arena. Ethereum educator Anthony Sassano remarked that increasing competition in the staking space is instrumental in curbing Lido's growth and fostering a more decentralized staking ecosystem. As a result, the Ethereum staking landscape is poised to become even healthier and more decentralized in the foreseeable future.