Architecture

Stake lvlUSD to earn rewards and get slvlUSD

Users can stake lvlUSD via the LevelStakingPool smart contract.

When staking, a user deposits lvlUSD into the contract and receives slvlUSD (staked lvlUSD) in return.

Rewards accumulate over time as additional lvlUSD is distributed to the contract.

When unstaking, slvlUSD is burned, and the user receives a proportional share of lvlUSD based on the total lvlUSD held in the contract relative to the outstanding slvlUSD supply.

Users will receive their lvlUSD originally staked along with a proportional share of the accumulated rewards when unstaking.

The LevelStakingPool smart contract uses the ERC-4626 Tokenized Vault Standard.

ERC-4626 is an Ethereum token standard designed to optimize and standardize the way yield-bearing vaults interact with ERC-20 tokens. It improves efficiency, security, and composability for protocols that manage deposits, withdrawals, and yield distribution.

Key Features of ERC-4626

1. Standardized Vault Interface

   • ERC-4626 provides a universal structure for tokenized vaults, ensuring interoperability across DeFi protocols.

2. Deposit & Withdrawal Mechanism

   • Users deposit lvlUSD into the vault and receive shares (slvlUSD).

   • Upon withdrawal, users redeem their shares (slvlUSD) for the underlying assets (lvlUSD) plus any accrued yield.

3. Automated Yield Distribution

   • Yield is generated through strategies like lending.

   • The total assets in the vault grow, increasing the value of shares over time.

4. Improved Gas Efficiency

   • Standardized functions reduce redundant contract interactions, lowering gas costs.

5. Enhanced Composability

   • Protocols can easily integrate with ERC-4626 vaults, enabling plug-and-play compatibility with lending, staking, and yield-aggregating platforms.