Renzo and Solana Optimistic Network (SOON) are making significant strides in the blockchain space, each advancing innovative solutions that could shape the future of decentralized finance and layer-2 scaling. Renzo, known for its liquid restaking protocol, is expanding its reach by launching its REZ governance token on Solana, aiming to reverse recent challenges and tap into Solana's growing ecosystem. Meanwhile, SOON has secured funding to develop its Solana-based layer-2 scaling solution, focusing on enhancing cross-chain interoperability and performance.
Renzo Expands to Solana with REZ Governance Token Launch Amid Efforts to Revitalize Protocol
Renzo, a prominent liquid restaking protocol, is making a significant move by launching its REZ governance token on the Solana blockchain. This decision, revealed exclusively to Lightspeed, marks a strategic expansion for Renzo as it seeks to leverage Solana's thriving ecosystem and innovative technology to regain momentum following a period of decline.
The REZ token will be introduced to Solana through the Wormhole’s native token transfer framework, a powerful tool that facilitates seamless token movement across multiple blockchains. This launch will also incorporate Wormhole’s advanced multichain governance system, MultiGov, allowing Renzo to pioneer decentralized governance in a multichain environment. The move is particularly significant as it positions Renzo among the first protocols to experiment with Wormhole’s MultiGov system, potentially setting a precedent for how decentralized autonomous organizations (DAOs) operate across various blockchains.
This launch comes on the heels of Renzo’s recent introduction of ezSOL, a liquid restaking token designed to complement Jito’s upcoming restaking platform on Solana. This platform is still in development, but it promises to integrate seamlessly with Renzo's existing ecosystem, providing users with new opportunities to maximize their yields.
Renzo has been a key player in the liquid restaking space, a niche within the decentralized finance (DeFi) sector that focuses on making the process of restaking more accessible and rewarding for users. For Ethereum users, Renzo’s protocol offers a streamlined solution: users can deposit ETH or stETH to mint Renzo’s ezETH, a liquid restaking token that accrues yield while simplifying the restaking process. This innovation abstracts away the complexities typically associated with restaking, making it easier for users to secure additional applications and services using their staked assets.
However, Renzo’s journey has not been without challenges. After its initial launch in December 2023, Renzo implemented a points-based system to reward restakers, culminating in an airdrop of the REZ token in late April 2024. While the airdrop generated initial excitement, the price of REZ quickly plummeted by approximately 75% since its debut on CoinGecko. This decline in value has been accompanied by consistent outflows from the Renzo protocol, as reported by DeFiLlama, largely attributed to airdrop farmers moving on to other opportunities.
In response to these challenges, Renzo is now looking to its partnership with Jito and the forthcoming launch of liquidity incentives and airdrops on Solana as a potential turning point. Diogo Costa, Renzo’s Head of Marketing, expressed optimism about the protocol’s future, describing Renzo as a “blue chip restaking protocol” that could see significant TVL (Total Value Locked) inflows once deposits are live on Jito’s platform.
Jito, a platform positioned to capture a substantial share of the Solana restaking market, is expected to play a crucial role in Renzo’s revival. According to Lucas Kozinski, a founding contributor to Renzo, Jito’s ability to generate lucrative fees for restakers could be a game-changer. The success of this partnership, however, hinges on the performance of Jito’s NCNs (Network Coordination Nodes), which are akin to EigenLayer’s AVSs (Active Validator Sets) and are crucial for generating fees that can be shared with restakers.
Governance in the Solana Ecosystem
The launch of REZ and ezSOL on Solana also contributes to the broader discussion about governance within the Solana ecosystem. Many of the tokens airdropped in Solana this year have been designed as governance tokens, raising questions about how these protocols will manage and implement decentralized governance.
Different protocols have adopted varying approaches. For instance, Jito has embraced the “one token, one vote” model, which is increasingly popular in the Ethereum ecosystem. On the other hand, Drift has taken a more experimental approach with MetaDAO, using futarchy governance, where markets predict the outcome of proposals and guide decision-making.
With the introduction of REZ and ezSOL, Renzo is now part of this evolving conversation. The protocol’s expansion to Solana and its participation in Wormhole’s MultiGov system will likely influence how governance models develop across the DeFi landscape.
Renzo’s launch of the REZ governance token on Solana marks a pivotal moment for the protocol as it seeks to overcome recent challenges and reestablish itself as a leader in the liquid restaking space. By leveraging Solana’s technology and Wormhole’s multichain governance framework, Renzo is positioning itself for renewed growth and innovation. As the protocol continues to evolve, its success will depend on the effectiveness of its governance model and the strength of its partnerships, particularly with Jito, in capturing the potential of the Solana restaking market.
Solana Optimistic Network (SOON) Secures Funding to Revolutionize Layer-2 Scaling with Innovative SVM Technology
Meanwhile, the Solana Optimistic Network (SOON) has successfully completed a funding round aimed at advancing its Solana-based layer-2 scaling solution, as announced on Aug. 27. This round, uniquely referred to as the “co-builder” round, diverged from traditional venture capital fundraising by exclusively soliciting funds from individual contributors rather than venture firms. Notable participants in this round include executives from prominent organizations such as the Solana Foundation, Solana Labs, Coinbase Ventures, Celestia, and Avail.
The successful closure of SOON’s funding round comes at a time when the funding environment for Web3 startups is showing signs of stabilization after a turbulent year in 2023. According to data from Crunchbase, crypto ventures secured approximately $2 billion in financing during the second quarter of 2024. This marks a period of renewed investor confidence and a steadying of capital inflows into the Web3 space, which had been experiencing a significant downturn.
SOON is positioned as an advanced layer-2 scaling solution designed to leverage the Solana Virtual Machine (SVM) for high-performance execution while enabling settlement on any layer-1 blockchain. This approach aims to address some of the most pressing challenges facing the scalability of decentralized applications (dApps) across various blockchain ecosystems.
The funds raised in the “co-builder” round will be allocated toward the development of SOON’s core products: the SOON Stack and SOON Mainnet. Although the specific amount of financing raised has not been disclosed, the strategic focus on building these products demonstrates SOON’s ambition to set new standards for layer-2 scalability.
One of the cornerstone innovations of SOON is the SOON Stack, a modular framework that integrates the SVM with the OP Stack, enabling the deployment of an SVM-based layer-2 solution on any layer-1 blockchain. This includes leading networks such as Ethereum, Bitcoin, and Cosmos, making SOON a versatile tool for developers seeking to enhance the user experience across different blockchain ecosystems.
The SOON Stack’s ability to combine the execution power of Solana with the liquidity and user bases of other layer-1 blockchains is a key element of SOON’s vision. According to Joanna Zeng, co-founder and CEO of SOON, the goal is to make the SVM the standard execution environment for every layer-1 ecosystem. This would allow developers who have been constrained by existing execution environments to deliver superior user experiences.
In addition to the SOON Stack, the funds from the round will also support the development of SOON Mainnet, a general-purpose SVM-based layer-2 solution deployed on Ethereum. By bringing the efficiency and performance of the Solana Virtual Machine to Ethereum, SOON Mainnet aims to offer a scalable solution that can handle the growing demands of dApps while maintaining low transaction costs and fast execution times.
A significant challenge for layer-2 scaling solutions has been the cost and complexity of securely storing and accessing transaction data. SOON is designed to integrate seamlessly with data availability (DA) layers, including CelestiaDA, EigenDA, and Avail, to address these bottlenecks.
Data availability is critical for ensuring that layer-2 solutions can operate efficiently without compromising security or decentralization. Ethereum’s Dencun upgrade in March 2024 sought to tackle this issue by introducing temporary off-chain data stores known as “blobs.” However, competing solutions like EigenDA and Celestia offer alternative approaches to managing data availability, each with its own set of trade-offs.
By integrating with multiple DA layers, SOON aims to provide a flexible and robust solution that can meet the varying needs of developers and users across different blockchains. This multi-pronged approach to data availability is expected to play a crucial role in the success of SOON’s layer-2 scaling solution.
The Implications of SOON’s Funding Round
The success of SOON’s “co-builder” funding round signals a growing interest in innovative layer-2 solutions that can enhance the scalability and performance of blockchain networks. By focusing on individual contributors rather than traditional venture firms, SOON has not only raised the necessary capital but also garnered support from influential figures within the blockchain community.
As SOON moves forward with the development of its core products, the network is poised to become a key player in the evolving landscape of blockchain scalability. With its emphasis on high-performance execution, cross-chain interoperability, and flexible data availability solutions, SOON is well-positioned to address some of the most significant challenges facing the blockchain industry today.
