Inception, a re-staking protocol on EigenLayer, has officially ceased operations due to not finding a suitable market position and lacking sustainable liquidity rewards.
In over 2 years of development, Inception has expanded its ecosystem, integrating more than 60 DeFi protocols and undergoing many stringent security tests but still could not maintain growth due to the many limitations in the shared security market.
MAIN CONTENT
Inception shut down after more than 2 years of operation due to not having a suitable product position.
The protocol has previously expanded connections with over 60 DeFi projects and launched over 15 LRTs.
The lack of liquidity rewards in the field of shared security leads to unsustainable development.
Why did Inception decide to cease operations?
According to information from the founder of Inception, the main reason is that the protocol could not identify an optimal position in the product market and lacked an attractive liquidity reward mechanism. These are two core factors that strongly impact the sustainable development of Inception.
In the field of shared security, maintaining economic incentives for participants plays a crucial role. According to a report from the Inception development team (2024), the lack of liquidity rewards makes the process of scaling and attracting new users increasingly difficult.
"We have made efforts to build a cross-chain re-staking ecosystem, but the absence of suitable liquidity rewards has made the business model unsustainable."
Founder of Inception, July 2024
What achievements has Inception achieved during its operational period?
Inception has developed over 15 LRTs and expanded its ecosystem to various different Blockchains. This protocol has also successfully integrated with over 60 DeFi projects, demonstrating technical capabilities and recognition within the community.
Not only that, Inception has passed at least 8 security tests, establishing a solid foundation of technical reliability – a key point in the cryptocurrency industry. However, commercial and liquidity factors remain significant challenges.
The significance of integrating with over 60 DeFi protocols
The extensive connection with the DeFi ecosystem allows users to fully utilize DeFi services such as Yield farming, Staking, and Liquidity Pool. This also helps Inception increase cross-chain interaction and diversify risks for investors.
Why does the lack of liquidity rewards significantly impact the re-staking model?
According to cryptocurrency expert Trần Minh Tuấn, the lack of liquidity reward mechanisms causes users to lack the motivation to maintain staking, leading to a decline in attractiveness and income. This is a common barrier for many shared security protocols today.
"Liquidity rewards are a crucial factor in retaining users and promoting sustainable development in the re-staking field."
Trần Minh Tuấn, Cryptocurrency Expert, 2024
Compare the differences between re-staking protocols on the market
Inception Criteria Competitor A Competitor B Number of LRTs launched 15+ 20+ 18 DeFi integrations 60+ 80+ 50+ Security tests 8+ 10+ 7 Liquidity rewards Lacking Available Available Sustainable development Unsustainable Stable Stable
Frequently Asked Questions about Inception and the re-staking protocol
1. What is re-staking and why is it important?
Re-staking is the process of reusing staking assets to enhance network security efficiency. It helps improve the protection of Blockchain and generates additional income for users.
2. Why could Inception not maintain operations despite many integrations?
The main reason is the inability to find a suitable market position and the lack of liquidity rewards to retain users, affecting the business model.
3. How do security tests impact the re-staking protocol?
This is an important factor in increasing reliability, protecting users against risks, and attracting integration partners, ensuring the safety of staking assets.
4. How do liquidity rewards affect the development of the protocol?
Liquidity rewards incentivize users to continue staking, keeping liquidity in the system, thereby ensuring the sustainable development of the protocol.
5. What should re-staking protocols do to achieve sustainable development?
Developing attractive reward mechanisms, enhancing cross-chain integrations, and ensuring security through stringent security tests are key factors.
Source: https://tintucbitcoin.com/inception-ngung-re-staking-tren-eigenlayer/
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