We plan to implement the UTONIC protocol, which will be the first restaking protocol on the TON network. Similar to how EigenLayer introduced restaking to the Ethereum ecosystem — currently securing 5% of the total ETH supply to protect various applications on Ethereum — UTONIC will bring restaking to the TON ecosystem. This will enhance the security of the growing number of applications on TON, increase the value and yield of TON assets, and encourage more TON holders to participate in staking.
TLDR
- UTONIC is the first restaking solution on the TON network, modeled after Ethereum’s EigenLayer.
- Restaking enhances security and scalability by allowing staked assets to secure multiple decentralized applications. It also increases use cases and yields for TON, concentrating value towards the TON token.
- UTONIC supports both native TON staking pools/nodes and Liquid Staking TON to participate in restaking. The native restaking is based on the Nominator Pool staking.
- The UTONIC architecture consists of several key components: Stakers, Vaults, Restaking Module, Operators, Actively Validated Services (AVS).
- UTONIC provides a naive LRT solution, uTON. Users can mint uTON using Native TON or LST and utilize UTONIC’s restaking services.
- UTONIC Stage 1 [Pre-restaking] is going to launch, with TON restaked to provide AVS testnet service before slash modular works.
Background
Restaking allows staked assets to be used for securing multiple networks or protocols simultaneously. Restaking enables the same tokens to be utilized across multiple layers, increasing the utility and potential returns for token holders. This method also enhances security and decentralization by allowing stakers to support various applications without needing to acquire additional assets.
Restaking was first introduced into the Ethereum ecosystem by EigenLayer, a pioneering restaking project on the Ethereum network. It leverages staked ETH to secure and protect additional dApps and protocols built on Ethereum. As of now, EigenLayer has managed to lock up 5% of the total ETH supply (4.7 million ETH, $12B TVL), supporting more than 17 Actively Validated Services (AVS).
Following the emergence of EigenLayer, restaking has become one of the hottest topics in the industry. Beyond Ethereum, other networks like Solana and BNB Chain have begun developing their own restaking protocols. For instance, Solayer handles restaking on Solana, while BinLayer does so on BNB Chain. Currently, however, there is no restaking protocol available on the TON network.
| Blockchain Network | Restaking Protocol |
|---|---|
| Ethereum | EigenLayer/Symbiotic/Karak |
| Bitcoin | Babylon/Satlayer/Pell |
| Solana | Solayer |
| BNB Chain | BinLayer |
| TON | UTONIC is coming |
Why is TON Restaking Important?
The Open Network (TON) is a decentralized and open internet platform focusing on achieving mass adoption while operating in a highly scalable secure framework. TON has now become one of the top ten public blockchains by market capital.
TON restaking is crucial as it enhances the security and scalability of the TON ecosystem by allowing existing staked assets and methods to be used in securing additional decentralized applications and services, where many of them will choose hybrid on-chain and off-chain structure to serve reaching hundreds of millions of users moving forward. This approach leverages the network’s existing validators, creating a more robust, flexible and economically-efficient infrastructure without the need for new resources.
Restaking Benefits:
- For TON Ecosystem: The network structure of TON Layer 1 is well-suited for certain applications, but there are also scenarios where it may not be the best fit, like where it needs atomic transactions and synchronicity. In these cases, Layer 2 solutions and Bridges are often required to meet the development and usage needs of such applications. TON Restaking can enhance the security of these Layer 2 solutions and Bridges, thus fostering the growth of the TON ecosystem.
- For TON Applications: New applications can build on a robust security foundation provided by TON restaking, thus encouraging innovation and leading to broader adoption within the ecosystem.
- For TON Holders: TON will have more use cases, resulting in greater yields for staking. Applications will rely on TON for security rather than issuing new assets, leading to a concentration of value towards the TON token.
Staking Methods
Users can participate in TON restaking through several two methods, including Native Restaking and LST Restaking.
Native Restaking: Based on (Single) Nominator Pool
There are currently several ways to participate in TON staking, which can generally be categorized into two types:
- Using a Hot Wallet for Staking: This method is less secure because the wallet holding the funds needs to be kept on the validator node, making it vulnerable to hacking.
- Using a (Single) Nominator Pool for Staking: This approach allows users to separate the wallet holding the funds from the validator wallet, enabling secure participation in staking.
The (Single) Nominator Pool is an excellent smart contract design that greatly enhances the security of TON staking. More importantly, it is a smart contract that can be further improved, giving us the flexibility to build on it and implement the restaking functionality.
UTONIC smart contracts will delegate the staked TON to the established (Single) Nominator Pool for participation in TON staking, while also opting into the restaking modules built on UTONIC. A key function of the UTONIC smart contracts is to act as the owner, fund provider, and fund withdrawer for the (Single) Nominator Pool. If a staker who has restaked on UTONIC is proven to have behaved adversarially while participating in an AVS, then that staker’s TON will be withdrawn from the Nominator Pool and be slashed according to the on-chain slashing contract of the AVS.
LST Restaking
In addition to supporting native TON tokens for restaking through an upgraded Nominator Pool, we also support LST (Liquid Staking Token) participation in restaking. Our decision to support LST restaking is based on the following considerations:
- Established LST protocols have already implemented the core functionalities for participating in Layer 1 staking and distributing staking rewards, ensuring that the LST tokens are backed by a corresponding amount of staked TON assets.
- Using LST tokens for restaking has proven to be a viable solution in Ethereum’s restaking ecosystem, with successful implementations seen in projects like EigenLayer and Symbiotic.
- Supporting LST participation in restaking prevents the need for TON tokens to be withdrawn from LSTs solely for restaking purposes, thereby improving the whole capital efficiency within the TON ecosystem and offering convenience to TON users.
UTONIC Architecture
The UTONIC Restaking protocol allows users to restake their Native TON tokens and LST TON tokens by depositing the assets. The users can determine the restaking strategies and delegate the restaked assets to the operators. Operators can then register with Actively Validated Services (AVS) to provide economic security. Operators perform tasks for the AVS in exchange for rewards, and the AVS has the ability to slash the assets that have been delegated if they indulge in malicious behaviour.
There are multiple entities involved in this protocol to enable the restaking of both LST TON and Native TON. The modularity of the protocol also provides an interface to extend restaking to any new asset as well. The architecture should give an overview of how each entity is placed in the system following which we shall go over them in detail.
Fig 1. The overall logic architecture of UTONIC
UTONIC Smart Contracts Design
The main function of the UTONIC contract is to manage the delegation relationship and shares record between users and operators.
Due to the asynchronous and shared nature of TON, designing interactions between contracts is relatively more challenging. To minimize issues with synchronization, we aim to keep contract functions as clear as possible while maintaining platform scalability. The main related contracts include the following:
UTONIC Manager: This contract serves as the central information hub for the platform. It records which assets are supported for restaking and performs management operations, via the Strategy contracts. Additionally, it maintains information about current platform operators and manages tasks such as registration and updating info.
Operator Register: Belongs to UTONIC Manager. Each operator has a contract to record their information and status, such as whether they are registered on the platform and if they have been slashed.
Strategy: Each supported asset corresponds to a Strategy, which is divided into two types: Strategy LST and Strategy TON (only one), corresponding to LST assets and native TON, respectively. The latter additionally includes functionalities related to TON staking. Unlike Eigenlayer, users delegate to independent operators for each Strategy. The main function of the Strategy is to record and maintain the user’s asset shares, as well as to track the total shares delegated by users to the Operator on the other end.
User Strategy Info: Belongs to Strategy. Each (Strategy, User) has one such contract. It records and maintains the user’s corresponding asset shares, which change when the user performs operations such as deposit, withdraw, delegate, and undelegate.
Operator Strategy Share: Belongs to Strategy. Each (Strategy, Operator) has one such contract. It records and maintains the total shares currently delegated to the corresponding operator for an asset. When the user performs operations such as depositing, delegating, and undelegating, the shares change based on the state. A key design point of the UTONIC contract is to ensure the accurate accounting of User Strategy Info and Operator Strategy Share.
Fig2. The quantities and relationships between User, Operator, and Strategy.
UTONIC User Flow
Operator: Register and Update
An Operator can simply send msg to the UTONIC Manager contract to update his info.
User: Deposit into UTONIC
Depositing into UTONIC varies depending on whether the Staker is depositing Native TON or LST Tokens. The main difference involves the handling of Jetton.
LST Restaking:
An User can send LST TON to the Strategy’s corresponding Jetton wallet. If the current User has already delegated to an Operator, the user’s additional shares will be added to the corresponding Operator Strategy Share.
Native TON Restaking:
User: Delegate to Operator
User: Undelegate
User: Queue a Withdrawal
LST Withdrawal:
Native TON Withdrawal:
LRT: Liquidity Creates Value
Beyond implementing the basic restaking framework, we also support minting Liquid Restaking Tokens. This approach helps to prevent liquidity shortages within the ecosystem that can arise when assets are locked up in staking and restaking.
uTON Architecture
The uTON token is the native embedded liquid restaking token (LRT) of TON in the UTONIC platform. The system built around uTON is called the uTON system. It allows users to restake their Native TON tokens and LST TON tokens with unified management. The assets will first go into some proxy contracts, and then uTON will be minted. After that, the assets move into the vaults.The vaults determine the restaking strategies and delegate the restaked assets to the operators, with the help of the UTONIC restaking system.
uTON Smart Contracts Design
The uTON contracts are divided into two parts: one part is the uTON Jetton, which has a standard Jetton interface and extends some capabilities based on demand; the other part consists of a series of Proxy contracts. The Proxy contracts have the authority to mint uTON, with different Proxy contracts implementing the uTON mint/burn process for various scenarios.
Key features:
- When Proxy mints uTON, it is valued in TON, and the Proxy internally manages assets, such as LST TON, relative to the price of TON.
- uTON Minter manages the uTON price of TON. It can be modified by the admin account.
- When users withdraw uTON, they always receive native TON. That is, if users enter with other assets, such as stTON stake, they will withdraw TON too.
uTON User Flow
Mint uTON with Native TON:
Mint uTON with LST TON:
Withdraw with uTON:
Pre-restaking
During the UTONIC Testnet phase, any validators of TON (Single) Nominator Pools currently active on the TON network can join the UTONIC Pre-restaking event. Participation is facilitated through the minting of the UTONIC Operator SBT, a non-transferable NFT that serves as proof of engagement in the UTONIC Pre-restaking program. By minting the UTONIC Operator SBT, validators signal their commitment to participating in the UTONIC Testnet and the future operation of the UTONIC AVS that will be deployed on the UTONIC testnet.
Validators successfully minting the UTONIC Operator SBT will mint an equivalent amount of uTON LRT based on the number of TON tokens staked in the validator’s associated (Single) Nominator Pool. During the testnet phase, the uTON tokens will remain locked in the smart contract, dynamically minting or burning based on the ongoing changes in the amount of TON staked by the validators. UTONIC will track the validator addresses that mint the UTONIC Operator SBT and their corresponding (Single) Nominator Pool addresses, with the staked TON contributing to the TVL under UTONIC Pre-restaking protection.
The primary goal of the UTONIC Testnet is to validate the feasibility of the TON Restaking architecture and to refine its functionality. During this testnet phase, the slashing mechanism will not be enabled.
During the Pre-restaking period, holders of TON, stTON, or tsTON can also directly participate by staking their TON, stTON, or tsTON. Upon restaking, they will mint uTON, which will be sent directly to their wallet and can be immediately used by the restaker.
Join us as we work towards building a more secure and robust staking ecosystem for TON!