Staking

Helix includes a staking mechanism designed to enhance protocol resilience while rewarding long-term HLX token holders. By staking HLX into the protocol’s Security Module, users receive stHLX, a yield-bearing token that represents their staked position and provides access to protocol rewards. This staking system is inspired by Aave ’s security module and follows a similar architecture, incorporating cooldown logic, reward emissions, and slashing protection mechanisms. The Helix staking framework is composed of several modular smart contracts:

HelixDistributionManager A reward engine that calculates emissions, tracks user rewards, and ensures fair HLX distribution across staking and incentives.
stakedHelix A staking contract where users exchange HLX for stHLX, manage cooldowns, withdraw, and earn rewards.
incentivesController Manages extra rewards from protocol activity and optionally auto-claims them into staking for boosted yields.
rewardsVault A secure vault for HLX rewards, accessible only by staking contracts for distribution.

Together, these components allow for decentralized and programmable emission logic while ensuring staking can serve its primary purpose: protecting the protocol through capital at risk and incentivizing long-term alignment.

Users can stake HLX tokens at any time by calling the stake() function on the stakedHLX contract. In return, they receive stHLX tokens in a 1:1 ratio. These tokens are non-transferable and represent the user’s position in the staking system.

While staked, users accumulate HLX rewards over time based on:

• The emission rate configured by governance.

• The user’s share of the total staked HLX.

• The duration of participation

Stakers can claim accrued rewards at any time using the claimRewards() function. However, to unstake HLX, users must first initiate a cooldown period by calling cooldown(). After a predefined duration (e.g., 10 days), the user enters a withdrawal window during which they may call redeem() to unstake and retrieve their HLX. Failing to withdraw during this window requires restarting the cooldown process.

This cooldown mechanism is critical to the protocol’s integrity. It prevents immediate mass exits during periods of protocol distress, particularly in the event of a slashing event, a scenario where a portion of staked HLX may be forfeited to cover a shortfall. The staking system includes intelligent cooldown timestamp tracking. Key behaviors include:

• Staking additional HLX during cooldown which updates the cooldown timestamp via a weighted average to prevent front-running or abuse.

• Redeeming HLX which resets the cooldown to zero.

This design ensures fairness and predictability while maintaining protocol security

Security Module and Slashing

The Helix Security Module (SM) acts as a backstop in the event of a shortfall (e.g., a severe liquidation failure or oracle manipulation incident). If governance initiates a slashing event, a predefined portion of staked HLX may be seized from the stakedHLX pool to cover losses. This aligns staker incentives with protocol health and discourages malicious activity. Slashing logic is governed transparently and can only be triggered by an onchain governance vote, providing users visibility and time to respond via the cooldown process

Reward Configuration and Emission Control

Emission rates and reward distributions are configurable via governance and managed by an EMISSION_MANAGER role. Helix can:

• Adjust emission rates dynamically across staking and supply/ borrow rewards.

• Pause or redirect reward streams.

• Assign new incentive targets or disable existing ones.

This ensures rewards are adaptive to protocol conditions and can be used to incentivize key behaviors across the ecosystem.

Staking in Helix provides a dual benefit to HLX holders: earning protocol incentives and contributing to the protocol’s financial security. Through stHLX, users participate in a dynamic reward system that prioritizes decentralization, capital efficiency, and risk alignment. With its robust cooldown and slashing mechanisms, the Helix staking architecture establishes a secure and transparent foundation for long-term protocol sustainability.