These days, I've been looking at the LST/re-staking setup again. To be honest, the returns can't just appear out of nowhere: some of it is the "system-given" basic staking, and a lot of the rest is actually people paying to ensure safety/liquidity/exposure, moving risks from elsewhere. It looks like a stacking game, with ETH doing the work underneath and various "I can also take a share" certificates on top.

The risks are pretty straightforward: the same collateral being promised multiple times, leading to a run-on everyone when things go wrong; plus, contract, oracle, and operator malicious acts or mistakes— even if the mainnet doesn't blow up, your little tickets could break first. I'm more concerned now about whether the exit channels are smooth; if liquidity is too tightly bound, it can make me nervous.

By the way, I want to complain about the recent ETF capital flow narrative. Tying it to U.S. stock risk appetite for interpretation is indeed convenient, but it can also mislead people's thinking... I'm a bit tired anyway, but still keep pushing. I'll start by reducing my positions and sleep soundly.