Summary
Objective Labs reocmmends the integration of rsETH into the Euler Arbitrum market as a collateral and borrowable asset. rsETH expands Euler Arbitrum’s LRT offering as the first lending market integration onchain.
Fundamentals
rsETH is a liquid restaking token (LRT) issued by Kelp DAO, representing ETH restaked via EigenLayer. It is deployed across multiple chains and has undergone audits from Sigma Prime, MixBytes, and Code4rena, highlighting Kelp DAO’s focus on security and protocol integrity. Users earn yield from both staking and restaking activities. rsETH offers a current APY of ~2.7%, based on the 7-day moving average from DeFiLlama.
Liquidity
rsETH liquidity on Arbitrum is modest and fragmented. Most depth exists in rsETH-WETH LPs across Balancer, Aura, and others, with TVL mostly under $500K. A trade simulation shows 5% slippage on ~$280K, highlighting the need for conservative risk settings.
Parameters
Caps
| Asset | Supply Cap | Borrow Cap |
|---|---|---|
| rsETH | 60 | 30 |
The proposed caps of 60 rsETH supply and 30 rsETH borrow anticipate expected liquidity growth in the coming weeks.
IRMs
| Asset | Base rate | Kink | Rate at kink | Rate at 100% (max) |
|---|---|---|---|---|
| rsETH | 0% | 50% | 1% | 40% |
LTVs
| Collateral | Debt | LLTV |
|---|---|---|
| rsETH | WETH | 93% |
| rsETH | wstETH | 92% |
| rsETH | weETH | 91% |
| WETH | rsETH | 93% |
| wstETH | rsETH | 92% |
| weETH | rsETH | 91% |
Borrow LTVs are recommended 2% below LLTVs.
Oracle
We recommend using a fundamental oracle: Chainlink’s rsETH/ETH exchange rate feed on Arbitrum, crossed by the same ETH/USD oracle already used in the market.