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TVL $1.9BAPY 0.04%medium riskUpdated Feb 1, 2025

Aave Ethereum weETH

Supply weETH to Aave V3 on Ethereum. weETH is Ether.fi's wrapped eETH liquid restaking token, combining ETH staking rewards with EigenLayer restaking yield.

ProtocolAave V3
Networkethereum
SymbolAETHWEETH
CategoryMoney Markets
Underlying Assets
weETHeETHETH
Contract Address0xbd5c86e1fd6c0e02b27c04a0c31c7d3da8c0d8f3

What is Aave Ethereum weETH?

Aave Ethereum weETH is a lending market for Ether.fi's wrapped eETH (weETH), a liquid restaking token. weETH represents ETH that is simultaneously staked on Ethereum's consensus layer and restaked through EigenLayer's actively validated services (AVS). Supplying weETH to Aave adds a third yield layer on top of staking and restaking rewards.

How This Market Works

weETH lending operates with unique yield stacking:

  1. Deposit weETH into Aave V3 (already earning staking + restaking yields)
  2. Receive aETHweETH tokens representing your deposit
  3. Earn additional interest from borrowers
  4. Total yield = ETH staking (~3-4%) + EigenLayer restaking + Aave supply yield
Low Native APY: Like other yield-bearing tokens, weETH has low Aave supply rates because the asset already generates yield. Borrowers primarily use weETH as collateral rather than borrowing it directly.

What Assets Are Involved

Supply Asset: weETH (Wrapped eETH) - Ether.fi's non-rebasing liquid restaking token Receipt Token: aETHweETH - Aave deposit token Underlying: ETH staked via Ether.fi, restaked through EigenLayer

weETH in Aave is used for:

  • Collateral for borrowing stablecoins or ETH
  • Recursive leverage strategies (borrow ETH, restake, repeat)
  • E-Mode positions for capital-efficient borrowing
  • Maintaining restaking exposure while accessing DeFi liquidity

Understanding Liquid Restaking

Ether.fi's weETH represents:

  • Native ETH staking (earning ~3-4% APY)
  • EigenLayer restaking (earning AVS rewards/points)
  • Full withdrawal flexibility (liquid, tradeable token)

The wrapping (eETH to weETH) makes the token non-rebasing, suitable for DeFi integrations where balance changes would complicate accounting.

Risk Disclosures

Smart Contract Risk: Exposure to Aave, Ether.fi, and EigenLayer contracts. Each layer adds potential vulnerability surface. Slashing Risk: EigenLayer restaking introduces slashing risk from AVS misbehavior, in addition to standard Ethereum validator slashing. Liquid Restaking Risk: weETH value depends on Ether.fi's operator selection and EigenLayer's security model. Protocol issues could affect the weETH/ETH ratio. Oracle Risk: Accurate weETH/ETH pricing is critical for proper collateral valuation. Complex derivative pricing introduces oracle challenges. Utilization Risk: While typically low for weETH, market stress could affect withdrawals. Complexity Risk: Multiple protocol layers mean more potential failure points and harder risk assessment. Newer Protocol Risk: EigenLayer and liquid restaking are newer DeFi primitives with less battle-testing than traditional staking.

Related Money Markets

Aave Ethereum WETH1.25% APYAave Ethereum USDT2.45% APYAave Ethereum wstETH0.01% APYAave Ethereum USDC3.47% APYAave Ethereum WBTC0.01% APY
Disclaimer: APY and TVL figures are based on on-chain data and may fluctuate. Past performance does not guarantee future results. DeFi investments carry smart contract, market, and liquidity risks. This content is for informational purposes only and does not constitute financial advice. Always conduct your own research before investing.

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