Decentralized Concentration Economy

Aggregation Layers and Restaking

One approach to addressing resource fragmentation has been the use of restaking and the creation of aggregation layers.

Restaking focuses on enhancing capital efficiency by sharing security among networks, leveraging the underlying assets. While restaking maximizes capital efficiency, it must accommodate a variety of use cases and systems within Active Validated Services (AVS). This diversity among AVS implementations can lead to increased costs and resource demands for Operators, who provide validation services to these AVSs.

Aggregation layers aim to solve these issues by creating a common framework for services that seek to benefit from shared security.

Alternative implementations exist, such as Polygon’s aggregation layer, which shares security across its ecosystem. However, these solutions are often limited to the networks within their respective ecosystems, restricting their broader applicability.

The Rise of DCE

The challenges of restaking and aggregation lie in the fact that security and infrastructure requirements are as varied as the use cases they support. Attempting to fit all projects into a unified aggregation layer can stifle growth, making such systems less attractive to new projects. Additionally, many projects prefer to launch and promote their own tokens, rather than reusing existing ones, especially in cases where security is not a primary concern.

To address these well-known issues, Nektar proposes a Decentralized Concentration Economy. This model allows diverse participants to converge at a common trading point without abandoning their unique implementations or tokens, while still benefiting from shared incentives and increased network effects.