Overview
Eigenpie is a liquid restaking protocol and SubDAO within the Magpie ecosystem (which also operates Penpie for Pendle and Cakepie for PancakeSwap). The protocol accepts various liquid staking tokens — stETH (Lido), rETH (Rocket Pool), cbETH (Coinbase), sfrxETH (Frax), and others — and restakes them through EigenLayer's restaking system. In return, depositors receive isolated liquid restaking tokens (e.g., mstETH, mrETH) that represent their restaked position.
The value proposition is threefold: simplified EigenLayer participation without managing operator selection and AVS delegation directly; liquid receipt tokens that can be used as collateral or in DeFi while earning restaking yield; and the Magpie ecosystem's expertise in yield optimization and tokenomics design.
Eigenpie has accumulated significant TVL by positioning itself at the intersection of the liquid staking and restaking narratives. The protocol benefits from the broader EigenLayer hype cycle, though it also inherits the systemic risks of restaking — namely, the compounding of smart contract and slashing risks across multiple protocol layers.
Smart Contracts
Eigenpie's contracts handle LST deposits, EigenLayer restaking delegation, and liquid receipt token (mLRT) minting. Each accepted LST has an isolated vault and corresponding mLRT, preventing cross-contamination between different staking providers. The architecture interacts with EigenLayer's StrategyManager and DelegationManager contracts for restaking operations.
The multi-layer contract architecture (LST provider → Eigenpie vault → EigenLayer → AVS) creates significant composability depth. Each layer adds smart contract risk, and the full stack requires trusting Lido/Rocket Pool/etc., Eigenpie, EigenLayer, and the AVSs being secured. The contracts have been audited but the interaction complexity is inherently challenging to fully verify.
Security
Security is Eigenpie's primary concern. The protocol sits on top of multiple smart contract layers, each with its own risk profile. EigenLayer slashing (when fully activated) creates a new risk category — restaked assets can be slashed if AVS operators misbehave. Eigenpie's isolation of LSTs into separate vaults limits contagion, but a vulnerability in the core Eigenpie contracts could affect all depositors. The Magpie team has experience from Penpie (which suffered an exploit in 2024), providing both caution and scrutiny.
Yield Generation
Yield generation combines multiple sources: base Ethereum staking yield (from the underlying LST), EigenLayer restaking rewards (from AVS operations), Eigenpie-specific incentives, and potential DeFi yield from deploying mLRTs in lending markets or liquidity pools. The stacked yield sources create an attractive APY that exceeds simple staking, but each layer introduces risk proportional to its yield contribution. Restaking yields from AVSs are still maturing and may not deliver sustained returns.
Adoption
Eigenpie has attracted substantial deposits, benefiting from the EigenLayer narrative and points-driven incentive programs. The protocol ranks among the larger LRT providers. The Magpie brand provides credibility within the yield optimization vertical. Adoption growth has tracked the restaking meta broadly, with TVL correlating to EigenLayer-related market sentiment.
Tokenomics
EGP token is the governance and utility token for the Eigenpie SubDAO, integrated with the broader Magpie ecosystem (MGP). Token holders can stake for boosted yields and governance participation. The SubDAO model allows Eigenpie to operate semi-independently while benefiting from Magpie's shared infrastructure. Tokenomics incentivize long-term deposits through lock-up mechanisms.
Risk Factors
- Smart contract stacking: Multiple layers of contracts (LST, Eigenpie, EigenLayer, AVS) compound risk
- Slashing risk: EigenLayer slashing could result in principal loss for restaked assets
- Depeg risk: mLRT tokens could trade below underlying value during market stress
- Penpie exploit history: Magpie ecosystem suffered a previous exploit ($27M in Penpie)
- Restaking sustainability: AVS yield generation may not meet market expectations
- Regulatory uncertainty: Restaking as a category faces unclear regulatory treatment
Conclusion
Eigenpie provides a convenient on-ramp to EigenLayer restaking with liquid receipt tokens and the Magpie ecosystem's yield optimization expertise. The product serves genuine demand for simplified restaking participation. However, the compounding smart contract risk across multiple protocol layers is significant — users are stacking Ethereum staking, LST, Eigenpie, and EigenLayer risks simultaneously. The Penpie exploit serves as a reminder that yield optimization protocols carry real security risk. Eigenpie offers attractive yields for risk-tolerant DeFi users who understand the layered risk profile.