Ethereum staking token weETH splits from restaking as rewards debate heats up

The move separates ordinary Ethereum staking from higher-risk restaking exposure as a new proposal to cap validator rewards divides the staking sector.Ethereum staking token weETH drops bundled restaking exposure. (Pixabay)Ether.fi has removed restaking from its main token, weETH, turning it into a plain Ethereum staking token and shifting restaking to a new token, weETHs.The change lets users choose between standard staking rewards with weETH or higher-yield, higher-risk restaking exposure with weETHs.Ether.fi’s move comes as Ethereum researchers propose cutting staking rewards to zero once staking participation crosses a threshold, a plan Ether.fi’s founder argues would hurt smaller stakers and staking-based products.Ether.fi, which holds about $3.55 billion of customer deposits and is one of the largest staking businesses in crypto, has stripped restaking out of weETH, its main product, leaving it as a plain token that earns ordinary Ethereum staking rewards.Anyone wanting the extra yield now has to hold a second token, weETHs.Staking means locking up ether to help run Ethereum and getting paid for it — whereas restaking puts that same ether to work a second time, securing other services for extra rewards on top.The tradeoff is that it doubles the ways a holder can be penalised, since a failure on either system can cost them part of their deposit.For current holders:You now have a clearer choice between basic staking exposure and additional restaking exposure depending on your goalsFor new users:This simply makes the EtherFi stack easier to understand— ether.fi (@ether_fi) August 6, 2026 Until this week, anyone holding weETH was taking on both risks whether they wanted the extra rewards or not. Now the choice is theirs: Hold weETH for plain staking, or weETHs to take the restaking rewards and the extra risk that comes with them.Ether.fi has captured roughly $223 million in annualized fees and about $51 million in annualized revenue. In the second quarter, it earned $41 million in gross revenue and nearly $10 million in earnings after rewards and other costs, with only $30,000 of value distributed to ETHFI holders through buybacks.The split lands as Ethereum's staking economics are under debate.A group of Ethereum researchers, one from the Ethereum Foundation, proposed this week that the network stop paying people to stake once half of all ether is locked up. Under the current setup the payment never falls to zero no matter how much gets staked, so there is always a reason to stake more, and they argue that concentrates ether with a handful of large custodians. Their proposed fix destroys a growing share of the rewards until the payment disappears entirely at around 60 million ether. About a third is staked today.Ether.fi founder Mike Silagadze was among the proposal’s critics, arguing it would push out smaller stakers and weaken the products built on staking rewards, his own among them.12345678910Building the Zcash Machine: Tachyon and Quantum ReadinessBuilding the Zcash Machine: Tachyon and Quantum ReadinessZcash’s Tachyon upgrade aims to scale shielded payments, improve quantum readiness, and test whether its funding, security, and governance can hold.Zcash’s Tachyon upgrade aims to scale shielded payments, improve quantum readiness, and test whether its funding, security, and governance can hold.Why it matters:Zcash’s Tachyon upgrade aims to scale shielded payments, improve quantum readiness, and test whether its funding, security, and governance can hold.View Full Report