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chore: reformat
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ypatil12 committed Feb 19, 2025
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32 changes: 20 additions & 12 deletions docs/core/accounting/SlashingEdgeCase.md
Original file line number Diff line number Diff line change
Expand Up @@ -14,11 +14,15 @@ Consider a staker, Alice who is in the following state:

1. Alice has verified a validator. `withdrawble: 32 ETH`
2. Alice's operator is slashed for 75%. `withdrawable: 8 ETH`
a. `depositShares: 32`
b. `maxMagnitude: 0.25`
c. `BCSF: 1`
d. `DSF: 1`
e. `withdrawable = 32 * 0.25 * 1 * 1 = 8 ETH`
<details>
<summary>View calculation details</summary>

* `depositShares: 32`
* `maxMagnitude: 0.25`
* `BCSF: 1`
* `DSF: 1`
* `withdrawable = 32 * 0.25 * 1 * 1 = 8 ETH`
</details>
3. Alice is slashed by 16 ETH on the beacon chain

## Restaking
Expand All @@ -28,21 +32,25 @@ We define restaking as **reusing staked ETH as security for AVSs. Thus, the same
In the above scenario, let's say the Alice now proves a checkpoint.

4. A checkpoint of BC state is proven. `withdrawable: 4 ETH`
a. `depositShares: 16`
b. `maxMagnitude: 0.25`
c. `BCSF: 1`
d. `DSF: 1`
e. `withdrawable = 16 * 0.25 * 1 * 1 = 4 ETH`
* `depositShares: 16`
* `maxMagnitude: 0.25`
* `BCSF: 1`
* `DSF: 1`
* `withdrawable = 16 * 0.25 * 1 * 1 = 4 ETH`

The checkpoint slash has devalued Alice's currently withdrawable assets by 50%. The AVS slashes from what's left due to the BC getting priority burning rights. Thus, AVSs must factor Native ETH (or an LST) being slashed by the beacon chain when designing their slashing conditions. The below diagram illustrates this behavior:

<figure>
<img src="../../images/avs-bc-slash.png">
<figcaption>Note that the portion that is marked as BC Slash and BC + AVS Slash has priority burning rights by the beacon chain. 12 ETH has been slashed “twice”, but this is by design given our definition of restaking. </figcaption>
<img src="../../images/avs-bc-slash.png" alt="AVS and Beacon Chain Slashing Behavior">
<figcaption>Diagram showing how AVS slashing is applied after Beacon Chain slashing, with BC having priority burning rights</figcaption>
</figure>

Note that the portion that is marked as BC Slash and BC + AVS Slash has priority burning rights by the beacon chain. 12 ETH has been slashed "twice", but this is by design given our definition of restaking.

The behavior of BC and AVS slashings for Native ETH mimics the behavior of slashings for an LST in isolation (see below for an additional edge case). This ensures that Native ETH security is not disadvantaged compared to LST security. ELIP-004 explains this in [more detail](https://github.com/eigenfoundation/ELIPs/blob/main/ELIPs/ELIP-004.md#why-do-eigenpods-need-to-upgrade).

## Asynchronous Proofs

**When an AVS slashes, its attributable slashed amount is between 0 and the originally slashed amount. The attributable slashed amount decreases in the event of BC slashes.** We see this behavior in the above example, where the 12 ETH that was attributed to the AVS is less than the original 24 ETH that was slashed.

Let's take another example, where

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