These days, I've been looking at LST and the re-staking setup again, trying to understand where the returns actually come from. Honestly, there are only three sources: the interest from basic staking, the subsidies (token incentives) given by the protocol to attract TVL, and the security fees you earn by "reselling" the same trust. The first two are easy to understand, but the third one tends to become the "nested" scheme that everyone complains about, because ultimately someone has to actually pay the security fee, not just keep issuing tokens in a relay.

Risks are pretty much along the same lines: LST itself could de-peg or face liquidity crises, and stacking re-staking on top of that could lead to penalties, contract vulnerabilities, or operational issues with the team—these risks all bundled together... The on-chain data looks lively, but right now I care more about how much natural demand will remain after subsidies stop. Anyway, I don’t dare to treat it as risk-free interest. Let’s see what happens next.