Ether.fi chooses Scroll as its L2 settlement layer, announces crypto-based credit card

Mila September 9, 2024

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Key Takeaways

Ether.fi’s partnership with Scroll introduces gasless transactions for its credit card users.
The new partnership is expected to significantly boost Scroll’s total value locked.

Restaking protocol Ether.fi has chosen Scroll as its layer-2 blockchain for settlement, paving the way for the launch of its planned credit card and lending market.

Scroll, a zero-knowledge (ZK) rollup network that went live in 2023, will handle transactions for Ether.fi’s upcoming Cash card. The layer-2 solution has seen its total value locked (TVL) grow from $556 million to $676 million since at least August 5, according to data from DeFiLlama.

Ether.fi CEO Mike Silagadze expressed optimism about the partnership’s potential impact, predicting it could bring “billions in TVL” to Scroll and elevate it to a leading position among layer-2 networks. The integration aims to enable cardholders to use crypto as collateral for purchases and automatically settle balances using native yields.

Gasless settlements over Scroll

A key benefit of using Scroll is its low transaction costs. The network’s ZK-rollup technology allows for “gasless” transactions, meaning users won’t incur fees when sending or staking assets. Current data from Scrollscan shows average gas fees on Scroll at around 0.09 gwei ($0.005), compared to Ethereum’s average of 32.8 gwei.

Ether.fi has established itself as a major player in the restaking sector, with $5.7 billion in TVL – a 12% increase over the past month. This growth contrasts with trends in the wider restaking market, where competitor EigenLayer has seen a $5 billion drop in TVL since July 30.

Restaking sector reaches $24 billion in value

As a liquid restaking protocol, Ether.fi allows users to stake Ethereum and receive eETH tokens in return. These tokens can be used across various DeFi platforms to maximize returns while also earning loyalty points and additional rewards through the Ether.fi ecosystem.

Sapphire

The protocol aims to enhance Ethereum’s decentralization by enabling users to run their own nodes, potentially reducing risks associated with centralized node operators. It also partners with other DeFi projects to increase the utility of eETH within the broader Ethereum ecosystem.

The restaking sector, which includes protocols like Ether.fi, EigenLayer, Restake Finance, and Inception, has grown to encompass around $24 billion in total value. These platforms allow users to leverage staked assets for additional security and rewards across multiple blockchain applications, potentially increasing capital efficiency and security for decentralized apps.