Recently, I've seen people watching large on-chain transfers and hot/cold wallets on exchanges, shouting "Smart money is coming" whenever there's movement... I'm actually more concerned about where the profits come from after putting money into LSTs / restaking. The main part of LSTs still relies on validator rewards after deducting fees, plus a little MEV / small strategies; restaking is more like using the same security to do "part-time" work, with AVS paying you, but the money comes from protocol inflation / project subsidies / user payments, and if any of those stop, the face can change instantly.

The risks are pretty straightforward: on one side, penalties / node misbehavior on the underlying chain; on the other side, contract bugs, parameter changes, correlation risks in the restaking layer (if everyone crashes, we all crash), plus liquidity discounts, making it hard to run away. I'm currently testing with small positions, reviewing the audit reports twice, and not chasing the highest APR if I can help it, to sleep more peacefully.