StakeWise Staked ETH/OSETH#98 4

What is StakeWise Staked ETH (osETH)?

StakeWise Staked ETH (osETH) is a permissionless, non‑custodial liquid‑staking derivative that represents 1 ETH deposited in a StakeWise Vault plus all accrued validator rewards. Any solo staker or node operator can mint osETH to unlock DeFi liquidity while an over‑collateralised reserve shields holders from slashing risk.

StakeWise’s Dual‑Token v3 design issues ETH (principal) and OS (reward) tokens internally. osETH fuses both flows into a single repricing ERC‑20 asset whose exchange rate versus ETH rises as rewards accumulate.‑Token v3 design issues ETH (principal) and OS (rewards) tokens inside the protocol. osETH merges these flows into a single repricing ERC‑20 asset whose exchange rate vs. ETH increases as rewards accumulate.

Key Features

• Permissionless Vaults – Any validator or solo staker can create a Vault and mint osETH 1:1 against deposited ETH.

• Over‑Collateralised – Excess ETH in each Vault cushions holders against slashing or performance shortfalls.

• Repricing Token – No rebasing; instead, osETH’s exchange rate rises, simplifying DeFi integrations.

• Non‑Custodial – Users maintain full key control; StakeWise never has withdrawal rights.

• DeFi‑Ready – Accepted in major money markets, DEX pools, and yield strategies.

• Instant Redemption – Swap osETH for ETH on DEXs or burn via Vault exit after Beacon‑queue delay.

How Does osETH Work?

1. Vault Creation or Delegation – Node operators deploy a Vault smart contract; depositors delegate ETH to that Vault.

2. Minting – Vaults mint osETH 1:1 for depositors, retaining an excess reserve for risk coverage.

3. Reward Accrual – Validator rewards flow to the Vault, raising the osETH‑to‑ETH exchange rate (e.g., 1 osETH → 1.04 ETH after rewards).

4. Slashing Protection – If a validator is slashed, the excess collateral buffers osETH holders; node operator absorbs loss.

5. Liquid DeFi Utility – Holders supply osETH to lending markets, LP pools, or as collateral while continuing to earn staking yield.

6. Redemption – Burn osETH in the Vault to withdraw ETH (post‑exit) or trade on DEX for immediate liquidity

Primary Use Cases

• Collateral in Money Markets – Borrow stablecoins or leverage long ETH while earning staking APY.

• LP Farming – Pair osETH with ETH or stablecoins to earn trading fees plus rewards.

• Solo Staker Liquidity – Mint osETH against home validators for DeFi access without surrendering keys.

• Yield Stacking – Combine staking rewards with protocol incentives in DeFi strategies.

What is the osETH Token?

osETH is a liquid‑staking ERC‑20 asset that mirrors staked ETH plus rewards. Minted 1:1 against validators, it accrues yield via a rising exchange rate instead of rebasing, remains over‑collateralised to absorb slashing, and is trustlessly redeemable for ETH. Holders gain DeFi liquidity without forfeiting staking income or key control.

Where to Get osETH

• Direct mint (StakeWise Vaults) – Deposit ETH through the StakeWise web interface or CLI to any permissionless Vault. The Vault smart contract immediately mints osETH 1:1 (minus a small excess reserve) so you retain full key‑ownership and start accruing rewards without intermediaries.

• DEX liquidity pools – Swap for osETH on leading Ethereum DEXs: • Uniswap V3 – concentrated‑liquidity osETH/ETH pool. • Balancer – weighted osETH/ETH pool for deeper liquidity. • Curve – tri‑pool (osETH‑ETH‑wstETH) designed for low‑slippage swaps among staked‑ETH derivatives. Always check pool depth, slippage, and fees before executing large trades.

Wallet That Suppot OsETH Coins

ERC‑20 compatible wallets: Ledger, Trezor, MetaMask, Rabby, Trust Wallet, SafePal, Coinbase Wallet, OKX Wallet, Rainbow.

For node operators, use hardware signing + DVT setups (Obol, SSV) to secure keys while participating in StakeWise Vaults.