Venture capital firm Andreessen Horowitz (a16z) announced a $100-million funding round for EigenLayer, Ethereum’s largest restaking protocol by total value locked (TVL).

The venture firm was reportedly the only investor in the funding round, according to a Feb. 22 Bloomberg report . The EigenLayer protocol completed a $50-million funding round in March, led by Blockchain Capital.

Venture capital (VC) funding  for crypto-related firms rose 2.5% in the fourth quarter of 2023 to $1.9 billion, according to a report from PitchBook. This represents the first increase in VC crypto investments since March 2022. The rise in crypto venture investments could be attributed to the launch of the first spot Bitcoin ( BTC ) exchange-traded funds (ETFs) in January, according to PitchBook.

According to Ali Yahya, general partner at Andreessen Horowitz, the partnership could pave the way for new types of applications. He told Bloomberg:

“It will enable all sorts of new kinds of applications to be built… People will stake capital in order to gain rewards from new services that get spun up on top of EigenLayer.”

Founded in 2021, EigenLayer enables validators and stakers to restake liquid-staking derivative tokens like Lido Staked Ether ( ETH ) and RocketPool’s rETH to secure and validate other networks. These assets can also be deployed in other decentralized finance (DeFi) protocols to earn additional yield.

EigenLayer is currently the third-largest protocol on Ethereum, with a TVL of $7.91 billion. EigenLayer’s TVL rose 4.30% in the 24 hours leading up to 2:15 pm CET and over 347% in the past month, according to DefiLlama data .

a16z invests $100 million in EigenLayer — Report image 0 10 largest DeFi protocols by TVL. Source: DefiLlama

EigenLayer’s TVL started rising on Feb. 5 after the protocol temporarily removed its staking cap, aiming to incentivize organic growth, according to an official announcement. During this restaking window, EigenLayer’s TVL rose over 181% to $6.05 billion on Feb. 10 from just $2.15 billion on Feb. 5. While a new staking cap was applied, the project plans to permanently remove this limit in the future.

Restaking protocols are the sixth-largest protocol category on DefiLlama, with a total TVL of $7.94 billion, where EigenLayer accounts for 98%. Liquid staking protocols are in first place, with a combined TVL of $45.7 billion.

Related: EigenLayer becomes 4th largest restaking protocol, nears $7 billion TVL