Staking Alliance Proposal

iSOL — indexed SOL

A single SPL token that unites liquidity of all stake pools.

iSOL implementation 1

iSOL as common LP token. See [Public] Omniswap: a Staked SOL AMM for details.

iSOL implementation 2

iSOL as simple index.

Deposits:

We create a bank account that accepts deposits in jSOL, mSOL, scnSOL, stSOL, and gives back iSOL. Any and all deposits into this bank account will be put into a private N-asset LP.

• There is a “fair price” of iSOL that’s determined by the weighted average value of the xSOL in the bank account. Will we run into Gresham’s Law..?
  • in the degenerate case a person could put in a worthless xSOL and crash the entire system
    • this is actually dreadful. we have to calculate the amount of SOL to give, and we shouldn’t use an oracle
  • OK let’s handwave this for now and say that we have the weighted average value. OK moving on.

Withdrawals:

• simplest and fairest way is to withdraw proportionally from the N-asset LP bank account.
  • then, for good UX, swap all those assets to SOL (nobody wants to hold like 10 different SOL tokens)
  • but this means we’ll have to have xSOL-SOL routes for all xSOLs, which defeats the purpose.
• a better way is to calculate how much each SOL is worth in the open market, and unstake from an amount of xSOL (1 token).
  • in essence, do an “internal swap” from xSOL to e.g. mSOL (a pool with deep liquidity), then mSOL → SOL.
• eventually, we would swap iSOL directly to SOL in the open market (but this requires an LP with liquidity)

Why would anyone use iSOL?

for stake pools