Tokenization of Bitcoin Restaking

To finance Bitcoin liquidity, we must first tokenize Bitcoin restaking. After Bitcoin liquidity has been staked, Lorenzo issues two types of tokens: Liquid Principal Tokens (LPTs) and Yield Accruing Tokens (YATs).

Bitcoin Liquid Restaking Plan (BLRP)

A Bitcoin Liquid Restaking Plan (BLRP) represents the project to be staked to and its restaking rules. For example, Babylon-Lorenzo-01 is a BLRP that restakes liquidity to Babylon and Lorenzo. Its associated restaking rule is that, when restaking to Babylon-Lorenzo-01, stakers receive the same amount of stBTCs as the BTCs they stake and the YATs will accrue yield from Babylon and Lorenzo at maturity. YATs are issued by BLRP, every BLRP contains the following information and all the YAT tokens issued by the same BLRP are fungible.

{
    name: YAT token name
    symbol: YAT token ticker
    planDescUri: project description
    planId: stakePlanId, incremental ID for restaking plan
    agentId: stakeAgentId, Staking Agent ID
    subscriptionStartTime: Subscription starts
    subscriptionEndTime: Subscription ends
    endTime: YAT maturity time
}

Liquid Principal Token (LPT)

Liquid Principal Tokens represent the rights to claim the staked Bitcoin principal after the restaking concludes. LPTs do not have to be in the same form for Bitcoin restaking, but Lorenzo promotes stBTC, a BTC-pegged token, as its official LPT to avoid liquidity fragmentation. Using stBTCs, if a user stakes 10 BTCs, for example, to a non-slashable PoS chain in the Babylon ecosystem, Lorenzo will return the user 10 stBTCs. The user will later use the 10 stBTCs to reclaim the staked principle of 10 BTCs.

Yield Accruing Token (YAT)

Yield Accruing Tokens represent the rights to claim restaking yield once the restaking is ended. Each YAT accrues yield from Bitcoin restaking. YAT are ERC-20 tokens issued by restaking to a BLRP.

Since both LPTs and YATs can be traded, anyone who owns the YAT and the LPT could use them separately to claim yield and withdraw restaked BTC.