rstETH restaking guide on Mellow

P2P.org is excited to walk you through an exciting opportunity from Re7 Labs- the rstETH vault, a liquid restaking solution built on the Mellow protocol.

Understanding the rstETH Vault

The rstETH vault is curated by Re7 Labs and built on the Mellow protocol, offering an innovative approach to liquid restaking. Mellow provides both a user-friendly interface and the underlying protocol infrastructure, enabling the creation of Liquid Restaking Tokens (LRTs).

At the core of the vault's functionality is Symbiotic - a permissionless restaking protocol that offers flexible mechanisms for decentralized networks to coordinate node operators and security providers. The protocol's flexible and neutral design provides unique benefit for Mellow users.

Mellow allows the permissionless creation of modular LRTs (Liquid Restaking Tokens). It offers a series of vault smart contracts with different and unique properties, managed by LRT curators. One of these LRTs is rstETH, which represents an innovative approach to liquid restaking. When you deposit assets into the rstETH Vault, Mellow's smart contract mints LRT tokens at your request. The amount of rstETH tokens you will receive is almost equivalent to a 1:1 wstETH:rstETH ratio.

Restaking flow on the Mellow side

Follow these three steps to begin your restaking journey with the rstETH vault.
Here's how to get started:

Let’s dive deeper into the details.

1. Go to the rstETH restaking Vault page:
   rstETH.mellow.finance

1. Connect your wallet, review, and confirm the terms.
   

2. Choose the tokens you want to deposit and proceed (note that your tokens will be converted to wstETH).

3. Click the deposit button and follow the prompts to sign the transactions. This will wrap your stETH into wstETH and deposit it into the Vault.
   

4. Congratulations!🎉 As a result, you receive rstETH.

5. You can put your rstETH to work and unlock the opportunities offered by Mellow Your rstETH tokens are compatible with a wide range of DeFi protocols.

6. Now, click on the protocol where you’d like to use your rstETH. For example, let’s select GearBox.
   Be cautious, as you’ll be redirected to the protocol’s official website. In this case, it will be: https://app.gearbox.fi

a) Click on the protocol where you’d like to use your rstETH. For example, let’s select Gearbox Protocol.

b) Review the terms, parameters, strategy, and any other features the protocol offers to get the most of your rstETH. Remember, the metrics are only estimations, so take the time to assess everything carefully and ensure they align with your goals before proceeding.

c) Please pay attention that behind the scenes, the protocol will borrow wstETH to put them into the rstETH vault. And the looping strategy in general, works only when borrow rate is lower than token base status.

d) It is important to thoroughly understand the risks associated with looping strategies before using this service. To make the strategy better, Gearbox uses the mint price from the rstETH contract instead of DEX-based price feed.

e) Once you’ve reviewed all the details and feel confident about moving forward, follow these steps: connect your wallet, specify the amount of rstETH you want to deposit, adjust the parameters if needed, and click the “Deposit” button to finalize your transaction. Make sure to double-check everything before confirming.

f) Now, you can take advantage of the potential benefits provided by the rstETH protocol and its restaking strategy, while accessing the potential benefits from Gearbox (in this example).

What is Symbiotic and why is it important in this vault?
Symbiotic is a permissionless restaking protocol designed to support decentralized networks by aligning node operators and security providers. According to Symbiotic, the importance of this vault lies in its ability to provide a secure, adaptable and efficient restaking framework.

The protocol’s versatile and neutral design delivers unique opportunities :

• Immutable core smart contracts on Ethereum.
  
• Flexibility for all ecosystem players: Network builders control their restaking implementation, operator selection mechanics, and reward and slashing logic.
  
• Capital-efficient multi-asset design.

What is Mellow?
Mellow is a modular infrastructure designed for creating Liquid Restaking Tokens (LRTs) with varying strategic frameworks. The system is fully permissionless, agnostic to underlying restaking protocols, and compatible with any assets.

Key Highlights:
• Flagship LRT for Symbiotic: Mellow will become the first and flagship LRT within the Symbiotic ecosystem.

• Security Approved: As a member of the Lido Alliance, Mellow has successfully passed security evaluations by the Alliance group.

• Strong Backing: Mellow’s 2021 fundraising round was led by Arrington Capital, ParaFi, and Robot VC, with contributions from Lemniscap, Primitive, and other notable VCs.

Why Mellow?
According to Mellow, their team has extensive expertise in developing advanced vaults and liquidity management systems. They highlight their experience in bootstrapping wstETH liquidity on mainnet for Lido and collaborating with leading protocols like Olympus, Velodrome, Aerodrome, Gearbox, and zkBob, where they’ve delivered sophisticated assets and ALM strategies.

Third-Party Incentives
For additional details, visit Mellow.Finance and Symbiotic.Fi. Please note that P2P.org does not manage or take responsibility for these incentive programs.

Risks assessment 
This information is provided for general purposes only and reflects P2P.org’s subjective view of the project. It is not professional financial advice. Before deciding to participate, you should carefully review all materials on the Mellow and Symbiotic websites, thoroughly evaluate the associated risks, and consult with appropriate legal, financial, and tax advisors. Failure to do so may result in significant financial losses, P2P.org will not be held liable for any decisions made based on the information provided. Proceed at your own risk.

• Audited Smart Contracts: Symbiotic and Mellow smart contracts have been audited. The reports are available here and here.

• Immutable Symbiotic Contracts: Symbiotic smart contracts cannot be changed by the Vault curator.

• Controlled Upgrades for Mellow Contracts: Mellow smart contracts are upgradable, P2P.org as the Vault co-curator cannot modify the Vault contract or withdraw user funds. The responsibility for upgrades lies with a Lido & Mellow-managed multisig, meaning the primary risk relates to the security of that multisig.

Guide by: Denis Kozlov