Restaking Research with Naveen & Tarun
Zero Knowledge
Bound Loss with Over-Collateralization
The concept of over-collateralization allows for bounding the total potential stake loss during attacks on services. If services are consistently over-collateralized by a certain percentage, the ultimate loss following arbitrary stakes varies can be limited to a predictable factor. For instance, in a scenario where a service is always 10% over-collateralized, even a loss of 0.1% of total stake results in a maximum potential loss of only 1.1%. However, knowing the exact profit margins from attacks may be difficult, emphasizing the importance of correctly determining the necessary levels of over-collateralization.
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