Restaking Protocol Ether.fi Selects Scroll as Layer-2 Network for Settlement

Scroll will be used to settle transactions on Ether.fi's Cash card.

Restaking protocol Ether.fi has selected Scroll as the layer-2 network for settling transactions on its upcoming credit card, the companies announced Wednesday.

Ether.fi is a part of the broader restaking sector, which is designed to give investors additional yield on top of the native yield provided by ether (ETH) staking. The entire market is valued at around $24 billion, according to CoinDesk data.

Scroll is a layer-2 blockchain that uses zero-knowledge (ZK) technology. Its mainnet began operating in October, and has since attracted $676 million in total value locked (TVL), up from $556 million as of Aug. 5, according to data from DefiLlama.

The integration will allow cardholders to use crypto as collateral and borrow against it for purchases, before automatically paying the balance with native yields, the announcement said.

Transactions on the card will be “gasless” – meaning there will be no fee to pay – thanks to Scroll's zk-rollup technology, which drastically reduces costs when sending or staking assets. According to data from Scrollscan, average gas fees are around 0.09 gwei ($0.005), compared with Ethereum's average of 32.8 gwei.

Ether.fi CEO Mike Silagadze told CoinDesk that he believes the card, named ether.fi Cash, will drive “billions in TVL” to Scroll and make it the leading layer-2 network.

"We're excited to announce that ether.fi has selected Scroll as the settlement layer for its credit card and lending/borrowing marketplace," Silagadze said in a statement. "This integration will enable cardholders to use crypto as collateral and borrow against it for purchases, automatically paying the balance with native yields and making transactions on the card gasless thanks to Scroll's zk-rollup technology."

Ether.fi is one of the largest restaking protocols, with $5.7 billion in TVL, up 12% over the past month. This contrasts with the broader restaking sector, with EigenLayer's TVL dropping by $5 billion since July 30.

Restaking protocols are designed to give investors additional yield on top of the native yield provided by ether (ETH) staking. The entire market is valued at around $24 billion, according to CoinDesk data.

CoinDesk is an independent operating subsidiary of Digital Currency Group, which also owns Grayscale, Genesis and Foundry.

Our editors choose the news to cover without input from Digital Currency Group and determine how it is presented.

The crypto market's downturn has sparked concerns over whether or not bitcoin will be able to continue its bull run in 2023.

Bitcoin price today, Jan. 11: BTC drops below $18K, down 1.3% over the past 24 hours and 17.2% year-to-date.

After rallying to highs of $18K on Jan. 10, bitcoin (BTC) fell once again on Wednesday morning as the broader market downturn continues.

The world's largest cryptocurrency by market capitalization fell 1.3% over the past 24 hours to trade at an average price of $17,983, according to CoinMarketCap data. BTC price dropped as low as $17,863 during the day.

Bitcoin's price has fallen 17.2% so far in 2023 after closing 2022 at $163K. The cryptocurrency reached all-time highs of $69K in November 2021.

Bitcoin's decline comes amid a broader market downturn that has seen total crypto market capitalization fall from highs of $3.4 trillion in April 2022 to lows of $833 billion at the time of writing, according to CoinMarketCap.

The downturn has been largely attributed to rising inflation, interest rate hikes by the U.S. Federal Reserve and the collapse of several major crypto projects, including Three Arrows Capital, Celsius Network and FTX.

Despite the market downturn, some analysts remain optimistic about bitcoin's long-term prospects.

"Bitcoin is still holding up relatively well considering the broader market conditions," said Joe DiPasquale, CEO of cryptocurrency fund manager BitBull Capital. "We've seen some decent rallies from lows of $15.5K in November, but the key resistance level remains around $18.2K."

"If BTC can break through this level and hold, we could see a move towards $20K. However, failure to do so may lead to another round of selling pressure, potentially pushing the price back down to the lows of 2022."