Proposal: Add support for rETH Token

74b084d50ea1e3935ebec492c39e33d3b9d3bba0

1. Who is the interested party for this collateral application?

  • Rocket Pool Pty Ltd.
  • David Rugendyke | Project Founder, CTO

2. Provide a brief high-level overview of the project, with a focus on the applying collateral token.

  • Rocket Pool is an Ethereum 2.0 Proof of Stake infrastructure service.
  • rETH is a redemption token representing staked ETH.
  • Without a stake pool service, only wealthy network participants who meet the 32ETH threshold are rewarded for validating transactions.
  • Rocket Pool democratizes participation in network validation by providing a service which lowers the wealth threshold.
  • Abstracting staked ETH as rETH participants are able to retain commodity properties of their stake (transfer of ownership).

3. Provide a brief history of the project.

  • 2017 - Rocket Pool proof of concept based on the specifications released for Casper in the Mauve paper by Vitalik Buterin.
  • Today there is a great team working on Rocket Pool passionately alongside a fantastic community. Both have helped Rocket Pool run two public betas with over 50,000 ETH (testnet) staked and hundreds of users participating over the last 1–2 years.
  • 2021 With Ethereum 2.0 on the horizon, Rocket Pool is aligning its battle-tested platform to begin staking as a decentralized network.

4. Link the whitepaper, documentation portals, and source code for the system(s) that interact with the proposed collateral, and all relevant Ethereum addresses. If the system is complex, schematic(s) are especially appreciated.

5. Link any available audits of the project. Both procedural and smart contract focused audits.

6. Link to any active communities relating to your project.

7. How is the applying collateral type currently used?

  • When rETH becomes available it can be used as a commodity

8. Does one organization bear legal responsibility for the collateral? What jurisdiction does that organization reside in?

  • Brisbane, Queensland (QLD)

9. Where does exchange for the asset occur?

  • rETH is currently unlisted.
  • It is intended that rETH will be able to be exchanged wherever ETH is exchanged.
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Probably my ignorance, but I thought Rocket Pool was still in testnet beta? That’s all I find on their website.

They are in public Beta - I could not post all links because new accounts limits you to 5 links.
They have a discord with up to date info.
Audit is in process.
I submit this listing proposal now because I assume there is some governance bureaucracy which takes time, RocketPool will be released by the time proposal would be approved. IMO

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Maybe it’s a good suggestion

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I’ve been participating in the beta and it’s a great project. Very thorough and well done.

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Rocket Pool has been live for a few months now, with nearly $400 million in TVL, and over 110k staked ether. Would love to revisit this and use rETH on Aave.

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Same here. Would give no reason to hold non-yield generating ETH for aave holders. Hopefully increasing the number of decentralized nodes ran.

I would even be happy with this if just I could use the rETH as collateral to borrow ETH. I think there’s a way that node operators could help balance out the pool.

I would like to add that it would be nice if we could get it added on the polygon network side of Aave as well. That way, I could take a loan against my rETH to start up a validator node. Over time, I pay back the loan on the ETH I borrowed, which frees up my collateral to create another node. For small operators, like myself, this could make a significant difference in scale-out.

I haven’t QUITE figured out who would want to borrow rETH (perhaps for a quick liquidity swap to pay bills for small businesses that need short-term loans or want to further speculate/profit from LP providers and yield farming.

I would be highly interested in rETH as collateral (at least) and RPL as another collateral/borrow pool.

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Completely agree. I think one use case for borrowing rETH is to front run the yield similar to that of alchemix, and borrowing in ETH against ETH diminishes liquidation risk. But personally I would be happy to rETH as collateral even with a 0% interest incentive to lend it out. To your point I think most people would prefer to borrow USDC/ other stables.

oh for sure! I would also be perfectly fine just being able to use it as collateral on my loan(s).

Essentially, it would give me a way to borrow ETH, swap to rETH, use that as collateral, then borrow more ETH to run a validator, swap to RPL, and still earn the ~4% yield on rETH. That would, in effect, likely balance out ETH borrowing.

Also, I think it would encourage some people to borrow ETH, to swap to rETH. As long as the APY on the ETH loan didn’t exceed the rewards rate, you would profit and it would result in net positive returns.

Also, another similar strategy would be to take your assets and convert to rETH. Deposit the rETH, then use that to borrow against whatever asset you wanted to take a loan for (like using it for capitalization of a business).

It’s just a really smart way to put your capital to work and support SMBs. If I could do that today, I would convert a sizeable chunk of my assets to rETH and deposit. It would also help grow the protocol.

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rETH is the only decentralized staking option and needs to be on Aave. The liquidity is still low, but it will increase in a hurry if dApps start to allow it on their platforms. I also expect the liquidity to increase drastically after Shanghai, when stakers are allowed to unstake later this year. I think a lot of validators will become rocketpool node operators since the APY is significantly higher than solo staking.

We all love Ethereum because of its decentralized nature. It’s incredibly important that we encourage the most decentralized staking option to keep the network decentralized. When the merge happens, which is hopefully only a couple months away, staking APY will hit double digit percentages. In my opinion, it’s very important that Aave include rETH before the merge so that people looking to earn the high staking rewards are aware of the token, and avoid other staking options that could centralize the network. Of course Aave would benefit from a first mover advantage.

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100% support rETH’s integration into Aave.
Rocket Pool launched just 5 months ago and is already #22 in terms of TVL on Ethereum.

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Err Guys? Any news on this? I just wanted to use aave for the first time. I am a bit disappointed now as pretty much all of my eth available for this purpose is reth.

Btw.: Any L2 suggestions on where to go now to borrow against it?

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The only places you can use your rETH is the Alchemix vault that is full, and the curve wstETH:rETH pool, both on mainnet. Incredibly frustrating that there aren’t more options for this important token.

Hi there,

Highly supportive as well! rETH has been live for over 6 month now, and has nicely growth its TVL with over 175k ETH staked now, spread across almost 1.2k validators.

One question: could we add rETH as a v3 market instead of v2? rETH is already present on Arbitrum, Optimism and Polygon.

What are we missing to move to Snapshot vote?

1 Like