🔐Risks
List all of the programs involved and their audit status (solana stake pool program, quarry)
As is with all yield, staking your SOL at the vault incurs some level of risk. However, we only deploy funds to audited protocols that have been running for a very long time.
Smart contract risk
vSOL utilizes a few smart contracts:
Stake pool: we use the official, audited, Solana stake pool program. More information can be found here.
Providing liquidity: our main liquidity pool is hosted by Sanctum and Saber. Saber has been audited by Bramah systems. Like Quarry, it has handled billions of TVL without issues. More information about Saber can be found here. Sanctum have been audited by several firms, and the information can be found here.
DePeg risk
vSOL basically has two different definitions of the price: the "real" price and the market price.
The real price is the intrinsic value of vSOL by taking the total amount of SOL managed by the stake pool and divide it by the total amount of vSOL in circulation. For example, if there is 1 million vSOL in circulation and the stake pool manages 1.1 million SOL, the real vSOL price is 1.1 SOL. The real price only increases, but one can only "withdraw" their SOL from vSOL by using our delayed unstake option. This retrieves the underlying stake accounts which can be unstaked manually. This takes until the next epoch (up to 3 days) to take effect, so selling your vSOL for the real price cannot be done instantly.
In order to instant unstake, one can sell on the open market. However, note that the market price can fluctuate based on buy and sell demand. If a vSOL holder needs substantial liquidity immediately, the market price can crash to below the real price due to price impact in the liquidity pool. However, these price differences are temporary, because the delta from the real price opens an opportunity for arbitrage.
When the real and market price significantly differ, this is called a dePeg. Particularly when dealing with leverage, one should take dePeg risk into account as this can (and has done) trigger liquidations.
Slashing Risk
Solana has a concept of slashing when validators act in bad faith. Because we allowlist validators in our delegation strategy this should not be an issue. However, apart from this, slashing is not implemented yet so this risk does not currently exist.
Unstaking Using the CLI
vSOL is provided through the SPL stake pool program, which is fully independent from The Vault, so it is possible to use the SPL CLI to unstake or stake SOL. That means you are not dependent on the dApp, https://thevault.finance, being available in order to unstake. Here is an example of how it can be done:
Install the CLI from https://github.com/solana-labs/solana-program-library
If you do not have your private key (for the wallet where you hold vSOL) available as a keypair file then you can export it from your wallet. If you use Phantom, here are instructions of how to do that https://edulanasca.hashnode.dev/how-to-export-a-private-key-from-phantom-to-a-keypair-file
If you are using a Ledger, you do not need to export the keypair. You can provide the key as on option to the command as follows
--keypair usb:\\ledger?key=0\0The 0\0 part should match your key derivation. For wallets imported to Phantom it would be 0, 1, 2 etc. for wallets created a while ago or 0\0 1\0 2\0 etc. for wallets created more recently.
Use the withdraw-stake command from the CLI https://spl.solana.com/stake-pool/cli#withdraw-stake. For example use the following command to unstake 5 vSOL:
spl-stake-pool withdraw-stake Fu9BYC6tWBo1KMKaP3CFoKfRhqv9akmy3DuYwnCyWiyC 5After this you will have a native active stake account containing your SOL in your wallet. Deactivate it, and then you can withdraw your SOL the next epoch. Here are instructions for how to do this with Phantom: https://help.phantom.app/hc/en-us/articles/4406374138771--Staking-Solana
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