Single-sided staking for Insurance
If passed, this proposal will result in offering single-sided staking to create an insurance pool that can be used to cover a shortfall event.
Staking can be powered by the following incentives and parameters:
300-500k tokens per month for single-sided staking rewards
Single-sided staking rewards auto-compound
Cooldown period of 7-10 days before rewards can be withdrawn. 24-hour window to withdraw before re-staked**
Up to 30% of the pool can be liquidated to cover a shortfall event
Insurance-staked APY can still be used to vote in governance.
A single-sided staking option will be added to the APY.Finance platform to create an insurance pool
No action will be taken
** Cooldown period purpose: a cooldown is required for effective insurance, if people can withdraw instantly, the pool will get drained right after a shortfall and before the funds can be used to cover it. People would have collected the rewards without any of the risks
A Withdrawal window between restaking is also required otherwise people can immediately start the cooldown period after staking and effectively get the option for instant withdrawal