Advanced
β‚Ώ CoBTC
πŸͺ™ Staking Protocol

πŸͺ™ Staking Protocol

πŸ” Staking Account

  • A 2-of-3 multi-signature wallet structure.

  • Signers include: the user, Coffer Network, and a third-party verifier.

  • Funds are locked and can only be released under one of two conditions:

    • Contract expiry (successful completion)
    • Slash conditions (breach of agreement)

βš™οΈ Staking Process

  1. Verify Ownership Sign a message from your Bitcoin address to prove control.

  2. Agree to Terms Sign an off-chain staking contract outlining responsibilities and conditions.

  3. Pledge Deposit Deposit 0.1% of your Bitcoin into the multi-sig staking account as a commitment.

Staking-Process

βœ… Happy Path

  • The user fulfills the terms of the staking contract.

  • Upon completion:

    • The 0.1% pledged BTC is returned.
    • Staking rewards are distributed.

  • The user can optionally renew the staking contract to continue earning.

Happy-Path

❌ Unhappy Path

  • The user violates the contract, e.g., by moving BTC early or breaching terms.

  • As a result:

    • The 0.1% pledged BTC is slashed and sent to the protocol treasury.
    • The user’s main BTC holdings remain unaffected.

  • The user is eligible to rejoin the staking protocol by initiating a new contract.

Unhappy-Path

βœ… AdvantagesπŸ›€οΈ Road to Decentralization