Functionality
The Flash Unstake module allows users to immediately convert their restaked assets into their original state. This feature is achieved by using a fixed-rate conversion approach, which ensures that users receive the full value of their assets.
Flash Unstake Dynamic Fees
The fee structure for Flash Unstake is intended to be dynamic and responsive to the amount of ETH unstaked. This ensures that the costs remain fair and consistent, adjusting according to the volume of assets involved in the transaction. Here are the different senários that could play out:
Initial Fee: When the pool's liquidity is abundant, the fee starts at a base rate, providing cost-effective liquidity.
Rising Demand: As more ETH is unstaked and the pool's liquidity drops, the fee increases to prevent excessive withdrawals and maintain stability.
Stabilization: Once the unstaked amount reaches a higher threshold, the fee stabilizes at an ideal rate, ensuring the pool can support high volumes of transactions without depleting its resources.
The Flash Unstake Pool
The Flash Unstake feature uses a pool of liquid assets set aside exclusively for this operation. This pool is initially limited to 5% of the total deposited tokens in an InceptionLRT Liquid Restaking Solution. As the protocol’s Total Value Locked (TVL) increases, the pool scales accordingly, accommodating varying levels of demand and ensuring sustainable liquidity.
Replenishment Mechanism:
Fee Distribution: A portion of the Flash Unstake fee goes to the InceptionLRT treasury, while another portion is used to attract new or existing restakers to replenish the pool.
Restaking Bonus: New restakers earn additional incentives as a result of the Flash Unstake fee, promoting continued participation and maintaining competitive LRT prices.
Workflow Example
Flash Unstake Process Example:
User Action: A user initiates a Flash Unstake request to convert their restaked tokens (inETH) back to ETH.
Unstake Amount: They flash unstake 250 ETH, representing 50% of the Flash Unstake Capacity.
Fee Calculation: A fee of 0.5% (1.25 ETH) is applied. This fee is split equally, with 0.625 ETH supporting the protocol and 0.625 ETH rewarding new restakers.
Transaction Execution: Users receive 248.75 ETH instantly, bypassing the traditional 7-day unbonding period.
Restaking Process Example:
New User Action: Another user wants to acquire 400 ETH for inETH (for example)
Restaking Process: Restake ETH directly on the InceptionLRT in return for inETH, receiving additional rewards.
Restaking Bonus Mechanics: The first 250 ETH deposited receives a restaking bonus, while the remaining 150 ETH is restaked without a bonus. The total restaking bonus for the 400 ETH deposit is 0.3125%, based on the proportion of the initial 250 ETH deposit receiving the bonus.
For more technical details regarding the Flash Unstake feature, please check here: Flash Unstake
Last updated
