Restaking has been a big buzz in DeFi lately, drawing eyes from both VCs and regular investors. The hype is all about tackling the capital inefficiencies in DeFi as it keeps expanding. With new protocols and tokens popping up every month, the problem of liquidity getting split up is getting more serious.

In this fast-moving scene, overload is trying something new, not just anything new, but something that stretches the frontier of restaking. Meet overload, the omnichain restaking layer.

Omnichain, restaking and layer all in one sentence? You guessed it right. To shed light on how big of a deal this is, let's backtrack to the protocol that pioneer, restaking, eigenlayer. By providing a security as a service with the help of restaking, this would allow many new projects to borrow security from ethereum base layer and be built on eigenlayer.

This is all fascinating with eigenlayer, but it is limited to ethereum. This is where overload finance says hold my beer.

WHAT IS OVERLOAD?

Overload is a restaking protocol built on base that allows you to restake any erc-20 token to any contract on any chain integrated with layerzero.

For example, you have some stake erc-20 tokens Arb, usdt or ENA staked on berachain or near, and another staking opportunity comes up on a L2 like arbitrum or Solana, you want to restake on this chains, with the current landscape of restaking, it is practically impossible to restake on two distance chain.

This is where overload stretches the restaking frontier. If users have a stake erc-20 token on berachain, with overload they can restake the token on a chain that's integrated with layerzero.

A simple outline example of how overload finance works.

1. erc20 is on berachain.

2. deposit the erc20 into overload's restaking contract on berachain

3. restaking to a consensus contract and validator on berachain.

4. the consensus contract would send a message from berachain to settlement chain (using layerzero endpoints)

5. now their erc20 tokens balance on berachain would be mirrored on the settlement chain

6. The restaked balance can now be used for security/validation for AVSs.

CORE FEATURES OF OVERLOAD.

What makes overload unique?

ARCHITECTURE.

Restaking model : when it comes to overload's approach to designing a restaking model, it aims to support all practical restaking models in the future but its main focus is the many to many model.

There are three primary restaking models, the one to one model, the one to many model and the many to many model, each comes with advantages and trade offs.

In a one to one model, restaking is straightforward, similar to direct erc-20 transactions. Simplicity has its benefits for basic operations but lacks the flexibility required for complex and large scale staking scenarios.

The one to many model allows a single stake to secure multiple validators, introducing the possibility of slashing but it sacrifices user control, centralizing decision-making with operators, this model is eigenlayer.

And then the many to many model, chosen by Overload, gives users full control over their staking decisions across multiple validators, eliminating the centralized control and limited flexibility of the one-to-many model.

While this model complicates slashing due to the large number of staking combinations, Overload handles this challenge through a unique approach called validator jailing.

CONSENSUS MECHANISM.

ON-CHAIN CONSENSUS.

In Overload many to many model restaking model, you cannot be slashed for your stake, in other words, it is slash immune.

This is a big deal, because in PoS network (ethereum for example) slashing plays a fundamental role in maintaining the security and integrity of the network. In simple words, it is designed to discourage validators from doing something dishonest, if you commit a slashable offense, your stake gets slashed.

Stake slashing is also employed by restaking primitive eigenlayer and LSDs, this is something overload stretches out from.

By moving consensus on-chain, it overcome a lot of the possible slashable offense like proposing and signing two different blocks for the same slot, double voting by attesting to two candidates for the same block and Inactivity leaks.

For example with double voting, it becomes impossible because the EVM would not allow it, a validator only need to attest once and if a second attestation is tried, it would simply revert back if it was tried as a transaction.

The only issue left, is the inactivity problem which is handled by kick and jail mechanism.

Since the consensus contract is built by outside developers, overload encourage developers to kick inactive validators out of the validator’s set forcing them to miss out on attestation rewards or employ the jail mechanism, where validators asset are locked in overload for a specific amount of time.

DISTRIBUTION OF REWARDS.

When validators contribute to a consensus contract, rewards are distributed to incentivize their service. Implementing this onchain is complex due to the offchain-onchain dynamics, especially in many-to-many models. Therefore, two reward distribution methods are suggested.

Merkle Tree Distribution:

Rewards are calculated offchain and distributed using a Merkle tree structure, this ensures a efficient and centralized distribution. This method, is centralized, but effective and has been previously used successfully by Votium for onchain vote-bribing. It reduces onchain transactions by batching rewards and minimizing the frequency of claims.

Growth Distribution:

Suitable for simpler scenarios where users delegate voting power to themselves.Rewards are calculated onchain using a growth formula similar to Uniswap V3's approach.The formula involves calculating rewards based on the growth of tokens restaked and the latest reward value observed per token.

POINT SYSTEM.

Overload point system rewards users for contributing to its growth through restaking assets.

Points are accrued at a rate of 1 point per hour for every $1 restaked. For example, if a user restake $5,000 for 48 hours, they would yield 240,000 points.

These points are updated hourly and reflected on the platform every 24 hours, with accrual beginning two hours post-deposit.

The system uses an hourly price average, calculated as the mean of open, high, low, and close values, to determine point calculations.

Overload has two incentive programs the Bonus Points and Boost Points.

BONUS POINTS:

This aim to increase the platform's total value locked (TVL) and prevent airdrop dilution. As TVL increases, a larger percentage of Overload tokens are airdropped to points holders, ranging from 10% for TVL under $10 million to 20% for TVL over $500 million.

BOOST POINTS.

The aim is to reward early adopters with a multiplier on their points, decreasing as TVL grows. For example, restaking when TVL is $22 million earns an 8x points multiplier, which drops to 6x once TVL exceeds $25 million. The program, lasting between 3 to 6 months, aims to incentivize growth, decentralize the project, and reward early supporters.

WHY YOU SHOULD BE BULLISH ON OVERLOAD.

the real question is why shouldn't you?

According to DeFillama, restaking sector is ranked 5th in top protocols by categories, with a combined TVL of $19.598b, bullish figures.

With overload taking restaking omnichain and introducing new approach to consensus and restaking models, it increases flexibility, and security for stakers, positioning itself as a major player in the restaking sector.

Be there!

Website: https://overload.finance/

Discord: https://discord.com/invite/mUqUGM4k95

Twitter: @overloadfinance

GitHub: https://github.com/overload-labs