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LSD Networks Withdrawals


The Stakehouse protocol is aligned with Ethereum’s Shanghai/Capella update, allowing Stakehouse users to easily withdraw their staked ETH.

Stakehouse LSD Network is a bit more nuanced as there are multiple stakeholders per validator. The granular level traceability of every ETH in a validator gives great benefits to stakers and protocols. That said, all withdrawal operations are a bespoke contract suite to fit inside the Stakehouse ecosystem.

Node Operators can initiate the withdrawal process on the LSD Networks dApp or with the Stakehouse SDK. LSD network owners can also initiate this process for validators in their network using the SDK. Upon completion, the ETH will be automatically distributed to each staker via a pro rata basis and claimable through the LSD Networks dApp.

Withdrawing from the dApp

When withdrawing from the LSD Networks dApp, users can initiate the process under the “My Validators” tab on the “Manage” page. Once a user begins this process, it cannot be undone.

Once a user begins the withdrawal process, the validator may be placed in a waiting queue on the Beacon Chain. The waiting queue is part of Ethereum’s native withdrawal procedure. When the waiting time ends, there are a few key steps that they will need to complete in order to withdraw the validator:

Balance Report - Report the validator’s consensus layer balance to verify that the conditions are met to remove it from the Stakehouse registry.

Withdrawal Assistant Deployment - Activate this to collect all the derivative tokens associated with the validator. When the full withdrawal is triggered, the derivatives are burnt and ETH is transferred from the Account Manager to the Withdrawal Assistant. The Withdrawal Assistant issues LP tokens to the validator’s LSD stakers who can then burn these LP tokens to get their ETH back.

Borrow dETH - Borrow the dETH required to burn and withdraw the validator. If there is dETH in the Protected Staking pool within the validator’s LSD network, it can be borrowed from the network. When this happens, Protected Stakers will get back their principle plus inflation accrued instead of dETH. If there is not enough dETH available in the validator’s LSD Network, the user will have to provide the remaining balance of dETH needed to borrow. Technically, anyone can deposit dETH in this step using the SDK. Depositors will get at least 1 ETH back for every 1 dETH they lend at the end of the withdrawal process.

Withdraw Validator - Exit the validator from the Stakehouse protocol by burning all the derivatives associated with it. If the validator incurred leakage or slashing in the stakehouse protocol, then the Node Operator will have to perform a “Top-Up” by depositing enough ETH to account for all 32 ETH.

Unstake ETH - At this point, the ETH should be sitting in the account manager. Unstaking this ETH will send it to the Withdrawal Assistant, which then distributes the unstaked ETH to the validator’s stakers on a pro rata basis. The validator’s Node Operator, Protected Stakers, and MEV Stakers can then withdraw their ETH from the assistant by burning the LP tokens minted by the Withdrawal Assistant as a proof of share.

Once the Node Operator successfully withdraws the validator, an option to “Withdraw from unstaked validator” will appear under the “Staked Position” tab on the “Manage” page for each of the validator’s stakers. This is where they can manually claim their pro rata share of the withdrawn ETH.

Check out our official LSD Networks Withdrawal Guide for the step-by-step process.