StakeWise

Staking

StakeWise is an Etheruem liquid staking service that allows anyone to benefit from staking yield that is run by secure and stable institutional-grade infrastructure.

Risk Rating
Good
Protocol Code Quality
Protocol Maturity
Protocol Design
Summary
What we like
StakeWise charges competitive fees and has a proven track record of running a resilient infrastructure and testing its system with over 200,000 ETH in various testnets.
What we like less
StakeWise issues staking rewards separately (rETH2) so users have to manually reinvest rewards to compound returns.
What it means for you
StakeWise offers a secure, transparent, and user-friendly solution that maximizes your yield and liquidity.
Information
Exploit/Hacks
None
Info
  • Website
  • Token: SWISE
  • Tags: Staking
Key Metrics
  • TVL: $319.4M (Rank #43)
  • TVL Ranking by Staking: #0
  • Blockchain: Ethereum, xDai
  • Chain TVL
    • Ethereum: $296.66M
    • xDai: $22.73M
Risk Assessment
Good
Protocol Code Quality
  • Code reviewed by several experienced auditors
  • Public team promotes accountability
  • No documented protocol hacks since launch
Protocol Maturity
  • Core protocol launched in 2021; maturity over one year minimizes technical risk as smart contracts are well battle-tested
  • Top 5% by total value locked reduces risk
  • Multisig wallet controls protocol upgrades
  • Multisig consists of at least 4 signers, which means the protocol is less susceptible to centralization risks
  • No timelock exists or no information documented, which mean a malicious actor could approve upgrades without any delay
  • Low voting power concentration reduces risk
Protocol Design
  • No death spiral concerns
  • This protocol is susceptible to risks related to staking a token to secure a network, such as slashing events
Things to know about StakeWise

How StakeWise works

StakeWise is a platform that lets you stake your ETH in the Ethereum 2.0 network and earn rewards. You can join the StakeWise Pool, which is a group of validators run by professional node operators, and get sETH2 and rETH2 tokens that represent your stake and rewards. sETH2 is a token that shows how much ETH you have deposited in the Pool. You get one sETH2 for every one ETH you deposit. rETH2 is a token that shows how much ETH you have earned as rewards from staking. You get one rETH2 for every one ETH you earn as rewards. These tokens are based on the ERC-20 standard, which means they can be transferred or exchanged with other tokens. You can use them to exit from staking or to access more opportunities to earn income in DeFi protocols. StakeWise charges a 10% fee on the rewards and uses Oracles to get the reward information from the Beacon Chain.

How StakeWise prevents slashing penalties

StakeWise prevents slashing and penalties by using various methods. It always enables slashing protection to prevent signing conflicting messages or missing duties, and it updates it whenever it upgrades its validators. It also uses failover nodes to prevent losing connection or missing blocks, and it switches servers quickly and smoothly if a server fails. Moreover, it monitors its performance closely on every attestation and proposal, and it uses alerts to detect and fix any issues with its applications.

How do withdrawals work

StakeWise uses a special method to ensure that the funds in the staking pool are secure and can be withdrawn by the users. This method is called the Horcrux, and it is a secret key that can unlock the funds from the validators. The Horcrux is split into 7 pieces, and each piece is held by a trusted person in the Ethereum community. These people are called the Horcrux holders, and they will oversee the withdrawal process and make sure that StakeWise does not cheat or steal the funds. The Horcrux was created in a secret and safe way, using an open-source tool that was audited. The Horcrux can only be recreated if x of the 7 pieces are combined. Then, the Horcrux holders will approve the withdrawal and send the funds to a smart contract, which will distribute them to the users according to their stake and rewards. The specific x threshold is omitted for security reasons, but users should expect x to be in the range of 4 to 6 holders.