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In the example, the delegator pays a 2\% fee on their rewards to the publisher. This fee is deducted from the delegator's reward and added to the publisher's reward.
- Assume that the Pyth DAO has set the maximum slashable amount at 500 bps of the total stake of each responsible publisher's assigned pool, the maximum amount that can be slashed is $500 \text{bps} \times 50\text{M} = 2.5\text{MPYTH}$.
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- From the investigation, \$200K of preventable liquidations were identified from on chain data, the Pythian Council could adjust the amount of stake slashed to 500K PYTH or 100bps (assuming PYTH/USD = $0.40).
- The 500K PYTH slashed is charged pro-rata to the 7 pools that constitute the stake subject to slashing (i.e. calculated according to the total stake in the 7 pools assigned to the 7 publishers found responsible for the misprint).
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- Assume `pool_1` has 10M staked, made up of **6M self-staked and 4M delegated PYTH**.
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- The publisher assigned to `pool_1` would see its self-stake slashed 100bps of 6M PYTH, ie. 60K PYTH, resulting in **5.84M** residual self-stake.
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- Delegators to `pool_1` would see their stake slashed by 100bps of 4M PYTH, ie. 40K PYTH, resulting in **3.96M** residual delegated stake.
- The total amount slashed in this example is 500K PYTH. This amount goes to the Pyth DAO treasury. The Pythian Council or the community can propose to the DAO to vote on means to distribute the slashed amount.
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