Liquid Tokens Vault

LYS Protocol's Liquid Tokens Vault is a secure repository for the liquid staking tokens it generates. When you deposit ETH or supported assets, these are converted into liquid tokens representing your stake in Ethereum's proof-of-stake network. LYS Protocol holds these tokens to ensure transparency, facilitate automatic yield optimization, and simplify withdrawals. The process will look as follows:

  1. Deposit: When a user deposits ETH or supported staking derivatives, the LYS protocol interacts with partnered liquid staking protocols (like Lido, Rocket Pool, etc.).

  2. Conversion: Depending on the chosen strategy:

    • Direct Staking: Your ETH will be staked on the underlying protocol, and you'll receive an equivalent amount of that protocol's liquid staking token (e.g., stETH for Lido, rETH for Rocket Pool).

    • Conversion: Supported staking derivatives may be swapped or converted into the primary liquid staking token LYS focuses on.

  3. Token Custody: Here's the crucial part: LYS protocol securely holds these liquid staking tokens. They represent your claim on the staked/re-staked ETH plus any accrued staking rewards.

  4. Withdrawal: When you want to withdraw your assets:

    1. LYS Protocol interacts with the relevant liquid staking protocol to redeem your liquid staking or re-staking tokens.

    2. You receive back the equivalent amount of ETH or potentially whichever asset you originally deposited.

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