Liquid staking is not fair for the native staking

🌞General
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As a liquid service provider that issues liquid staking tokens (LST), such as Lido and Rocket Pool, they are also a native restaker and can redirect their ETH to the EigenPod Contract to earn EigenLayer’s rewards. Additionally, their users who hold LST can also restake to earn EigenLayer’s rewards and have equal contribution points. This means that one validator or one ETH can earn double EigenLayer rewards. However, as a native staker, I believe this is unfair. LST should not be allowed to restake.

I have already raised this question on Discord and received a response, but Discord is not the appropriate platform for discussing this issue. Therefore, I am posting it here for everyone to discuss together.

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Why would it be unfair ?

Aave USDC on Ethereum : ~1% APR
Ramses MAI-DOLA on Arbitrum : ~20% APR

Both USD, but not the same risks, so not the same rewards. Free markets will decide if LST restakers deserve more rewards than native restakers

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I agree with @CheCoinMaxi .
The risks are simply different when leveraging those products, and cannot be considered unfair.

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Is this something you’re seeing in practice? Can you share examples?

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I think he’s saying that the liquid stake provider can re-stake the staked funds and sort of double-dip on the rewards. So it favors those few entities against the rest of the stakers.