SLURP-34 | Reimbursement of Audit Costs for Native LINK Staking Withdrawals

Abstract This proposal seeks DAO approval to reimburse LinkPool for $200,000 incurred in private and public audits necessary to enable native LINK staking withdrawals for the stake.link protocol. These audits were critical to the security and functionality of the protocol and ensure users can withdraw staked LINK directly from Chainlink Staking contracts without relying solely on Priority Pool liquidity and the stLINK/LINK Liquidity Pool on Curve Finance.

The $200,000 requested from Core Contributors will come in the form of the SDL token with commitments to not be sold in secondary markets for a period of at least 6-9 months minimum.

The $200,000 will be denominated in SDL at the time of the SLURP’s passage by the stake.link DAO Council.

Rationale The audits were essential to the long-term security and usability of stake.link, providing the following key benefits:

Native Withdrawal Capability: Enables users to withdraw LINK directly from staking contracts, bypassing reliance on Priority Pool and Curve liquidity. Enhanced User Experience: Safeguards against periods of depleted Priority Pool liquidity, ensuring uninterrupted user access to their staked assets. Rigorous Security Assurance: The audits were conducted by Cyfrin, a leading audit firm headed by ex-Chainlink Labs’Patrick Collins, and its competitive audit platform CodeHawks, ensuring the highest standards of security for a complex and mission-critical contract. During a period of ~3 months in 2024, the Priority Pool had no liquidity, leaving users reliant on external liquidity pools such as the stLINK/LINK pool on Curve Finance. While the Priority Pool periodically replenishes and often fully depletes shortly after, native withdrawals provide an essential fail-safe for future scenarios.

Specification Audit Costs: Total: $200,000 in the SDL token (does not include labor costs of contract development by LinkPool engineers and senior leadership). Firms: Cyfrin and CodeHawks. Timeline: Costs incurred between Q3 and Q4 2024. Reimbursement Terms: $200,000 to be reimbursed from the DAO Treasury within 30 days of proposal approval. Conclusion Approving this proposal ensures fair compensation to LinkPool for its significant investment in enabling critical functionality for the stake.link protocol and further bolstering its brand of refined Chainlink Staking. Native LINK staking withdrawals enhance the protocol’s long-term viability and protect against potential risks tied to depleted Priority Pool liquidity.

We look forward to discussion on this proposal and thank everyone for your patience on the development, audits, and implementation of Native Staking Withdrawals which are expected to be fully deployed by no later than the middle of January.