How Does Ankr Work?
Ankr is a Web3 infrastructure provider that offers liquid staking services across 9+ Proof-of-Stake blockchains including Ethereum, Polygon, Avalanche, and Fantom. When you stake your tokens through Ankr, you receive liquid staking tokens (like ankrETH for Ethereum) that represent your staked position and can be used in other DeFi applications while continuing to earn staking rewards. Ankr also provides RPC node infrastructure used by many Web3 applications. The ANKR token has no built-in inflation, and node providers must stake 100,000 ANKR as collateral.
TVL
$21M
Sector
Liquid Staking
Risk Grade
C+
Value Grade
C-
Core Mechanisms
3.4.2
Reward-bearing LSTs (ankrETH, ankrPOL, ankrAVAX, etc.) across 9+ PoS chains
Users stake native tokens and receive reward-bearing liquid staking tokens. Token value appreciates over time as staking rewards accrue. Supports ETH, POL, AVAX, FTM, DOT, and others.
3.3.2
Protocol-assigned delegation to curated validator set
Ankr automatically delegates staked assets to selected validators across supported chains. Validator selection is managed by the protocol team.
3.1.1
Pro-rata staking reward distribution via LST exchange rate appreciation
Staking rewards distributed proportionally to all LST holders through the exchange rate mechanism. No inflation built into ANKR token itself.
5.1.1
ANKR token-weighted governance for protocol parameter changes
ANKR token holders can propose and vote on changes to the staking system. Node providers must stake 100,000 ANKR as collateral.
6.4.1
Oracle service for LST exchange rate reporting across chains
Ankr operates oracle infrastructure to report LST exchange rates to DeFi protocols. Critical for accurate pricing of ankrETH and other LSTs in external lending protocols.
8.2.1
LSTs bridged across chains via canonical and third-party bridges
Ankr LSTs are available on multiple chains through bridge infrastructure. Cross-chain LST availability increases composability but adds bridge dependency risk.
2.1.2
Percentage-based fee on staking rewards (protocol takes a commission cut)
Ankr takes a commission from staking rewards before distributing to LST holders. Standard revenue model for liquid staking protocols.
How the Pieces Interact
Bridged LSTs on secondary chains depend on both the bridge security and the underlying staking. A bridge exploit could create unbacked LSTs on one chain while the staked assets remain locked on the source chain.
The 2022 exploit demonstrated that contract upgrade authority can be weaponized for unlimited token minting. Even with improved security, the upgrade mechanism remains a high-value target for insider threats or key compromise.
ankrETH and other LSTs used as collateral in external DeFi protocols depend on accurate oracle reporting. A stale or manipulated exchange rate could cause incorrect liquidations or allow undercollateralized borrowing.
Ankr selects validators across 9+ chains. A validator failure or slashing event on any chain affects all stakers delegated to that validator, with limited user control over delegation choices.
What Could Go Wrong
- December 2022 exploit ($5M stolen) was confirmed as an inside job by a former employee who inserted malicious code enabling unlimited token minting — demonstrates supply chain and insider threat risk
- Multi-chain liquid staking across 9+ tokens (ankrETH, ankrPOL, ankrAVAX, etc.) creates a wide attack surface; a vulnerability in any single chain integration could cascade
- Centralized operator control over validator selection and protocol upgrades creates trust dependency despite governance mechanisms
Repeat Insider Supply Chain Attack
TailTrigger: Compromised employee or contractor inserts malicious code into a protocol upgrade, enabling unauthorized minting or fund extraction
- 1.Malicious code inserted during routine protocol update — Attacker gains ability to mint unlimited LSTs or drain staking contracts
- 2.Attacker mints and sells large quantities of LSTs on DEXs — LST price crashes as supply floods the market
- 3.DeFi protocols using ankrETH as collateral face mass liquidations — Cascading losses across lending protocols holding ankr LSTs
- 4.Users lose confidence in Ankr security — Mass unstaking requests overwhelm withdrawal capacity
Risk Profile at a Glance
Overall: C+ (37/100)
Lower score = safer