Introducing $KEP — Kelp Earned Points

Executive summary

With more than $500 million in assets deposited on EigenLayer, Kelp DAO is one of the largest liquid restaking platforms that enables liquid restaking for native ETH and ETH LSTs alike.

An important driver for growth of restaking is the EigenLayer Points that users earn once their assets are restaked on EigenLayer. However, the challenge with EL Points is that they remain illiquid and users cannot utilize their earned points anywhere.

To mitigate this, Kelp is introducing $KEP — Kelp Earned Points token, to bring liquidity to illiquid EigenLayer Points/ rewards. Users will now be able to transfer and trade their earned points and also participate in DeFi with $KEP. Simply put, all EigenLayer points earned by Kelp DAO are distributed proportionally to rsETH holders in the form of $KEP tokens.

Introduction

Kelp DAO is one of the early pioneers of liquid restaking. Since December 2023, more than 18,000 restakers have deposited over 170,000 $ETH with Kelp minting $rsETH. Kelp accepts both native ETH and LSTs (ETHx, stETH, and sfrxETH) as collateral for which users can earn both, EigenLayer Points and Kelp Miles.

However, EigenLayer Points are non-liquid, non-ownable, non-transferable, and not interoperable. They cannot be used in DeFi nor can they be sent to someone else’s wallet address.

To address some of these challenges, Kelp is introducing $KEP.

$KEP Token

$KEP (Kelp Earned Points) is designed to be a game-changer in the restaking landscape. It is a token representation of EigenLayer Point earned by Kelp where 1 $KEP = 1 EL Point. Users have complete autonomy to store, share, and utilize their accrued EigenLayer Points as they see fit. Restakers can also buy, sell, long, short, leverage, or strategically position themselves for further restaking ecosystem airdrops according to their preferences.

Restakers can claim their $KEP tokens on Kelp dApp soon. Each week, the restakers can choose to claim the EigenLayer Points they earned in the previous week.

Advantages of $KEP

$KEP is an ERC-20 token. This means it can be freely transferred and traded, making EigenLayer Points and other potential restaking rewards highly liquid.

Restaking ETH or LSTs is not the only way to earn EigenLayer Points. $KEP can make restaking capital efficient and introduce segmentation between different groups.

• Point producers: Users who generate EigenLayer Points and thereby $KEP
• Point accumulators: Users who trade/buy/sell/long/short $KEP and may not necessarily have the ETH capital to generate $KEP through restaking

Use cases that $KEP can enable immediately include:

1. Trading of KEP on AMMs
2. Provision liquidity on DEXs with $KEP <> rsETH, $KEP <> USDC pairs to earn kelp miles and swap fees
3. Many more DeFi opportunities are under development

Claiming $KEP

Users who are earning EigenLayer Points through Kelp are eligible to claim $KEP tokens, including those holding rsETH or rsETH DeFi positions.

Kelp users can claim $KEP in 3 easy steps:

1. Go to the ‘Claim KEP’ section on Kelp dApp and connect your wallet.
2. Check the $KEP balance available for you to claim
3. Click on ‘Claim’ and the $KEP token will be transferred to your wallet

Once a user successfully claims their $KEP token, the corresponding EigenLayer Points balance will be reduced for their wallet.

Kelp will charge a 0.5% fee for claimed $KEP tokens for enabling DeFi operations. This fee will be utilized to incentivize restakers on Kelp DAO.

Unclaimed $KEP

Not claiming $KEP tokens is completely fine. Unclaimed $KEP tokens will be attributed to the restakers that did not claim $KEP at the time of rewards disbursal of EigenLayer or other protocols.

Future rewards with $KEP

For any rewards issued by EigenLayer or other protocols for EigenLayer Points, $KEP holders will receive rewards in proportion to the EigenLayer Points their $KEP token holdings represent.

There are 2 possible scenarios in which rewards can be distributed -

1. Scenario 1: The rewards are provided to Kelp DAO to redistribute amongst its restakers.
   Kelp DAO will enable a mechanism to distribute rewards based on the criteria defined by the rewarding entity and proportionally distribute it to $KEP holders. As mentioned before, Kelp DAO will redistribute 100% of all rewards it receives back to restakers.
2. Scenario 2: The rewarding entity collects data from Kelp DAO to make rewards available to Kelp’s restakers without passing the tokens to Kelp DAO.
   In this situation, the data that is required by the rewarding entity will be on-chain ($KEP token holdings), which will make the distribution extremely transparent.

Any unclaimed $KEP tokens will be reverse analyzed and attributed to the unclaimed restakers. Kelp DAO will ensure that accurate and updated data is available at all times.

For any further information you may need, check out $KEP FAQs.