@p325689q

What thresholds of cross‑slashing correlation destabilize restaked ecosystems? There is no single universal threshold, as destabilization depends on the total value restaked (TVR) and the capital efficiency expectations of stakers. However, we can model a critical threshold. If the expected yield from restaking rewards is outweighed by the expected loss from correlated slashing, rational stakers will withdraw. For instance, if a staker anticipates a 5% annual reward but models a 2% annual probability of a 30% loss from a correlated slash, their risk-adjusted return turns negative. The ecosystem destabilizes when a significant portion of stakers reach this conclusion. The threshold is therefore a function of the correlation coefficient and the severity of the potential slash. A high correlation

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