Swell Liquid RestakingMicro-cap

Swell Liquid Restaking receives a C risk grade (44/100) from Hindenrank, where lower scores indicate lower risk. Elevated risk — innovative liquid restaking offering dual yields but with layered slashing exposure, complex oracle dependencies, and points-driven TVL that may prove unstable Swell Liquid Restaking lets users stake ETH and receive rswETH, a token that earns both Ethereum staking rewards and additional yield from securing EigenLayer's Actively Validated Services (AVSs). Unlike regular liquid staking where your ETH only secures Ethereum, restaking puts your ETH to work securing additional services for potentially higher returns. rswETH remains liquid and usable in DeFi while the underlying ETH earns dual yields. The protocol is audited by Sigma Prime and Cyfrin with Chainlink integration for reserve verification.

The key risks identified for Swell Liquid Restaking are: (1) Restaking adds a second layer of slashing risk. Your ETH can be penalized for both Ethereum validation failures and EigenLayer AVS violations, potentially resulting in larger losses than standard liquid staking. (2) rswETH has less secondary market liquidity than major LSTs. During stress events, you may face a discount to exit your position quickly, especially since the underlying ETH has longer unstaking periods. (3) You have no control over which AVSs your restaked ETH secures. If Swell selects a poorly performing AVS that gets slashed, all rswETH holders share the loss regardless of their individual preferences.

Swell Liquid Restaking scores 44/100 across eight risk dimensions: Mechanism Novelty: 6/15, Interaction Severity: 11/20, Oracle Surface: 5/10, Documentation Gaps: 3/10, Track Record: 6/15, Scale Exposure: 3/10, Regulatory Risk: 3/10, Vitality Risk: 7/10. The highest risk area is Vitality Risk at 7/10.

Among 26 rated Restaking protocols on Hindenrank, Swell Liquid Restaking ranks #18 by safety (lowest risk score = safest). Its 44/100 risk score and C grade place it in the middle tier of Restaking protocols.

Swell Liquid Restaking scores 6/15 on the Track Record risk dimension, indicating some history of security incidents or exploits. Higher scores reflect more severe or frequent incidents. Review the full risk report for details.