Sherlock V2
  • 👋Intro to Sherlock
  • 🙋FAQ
  • 📚Glossary
  • ‼️Disclaimers
  • Audits
    • 🧑‍💻Protocol Teams
      • How it Works for Protocols
      • Audit Timeline
      • Scheduling Process
      • Audit Preparation
      • Protocol Involvement During the Audit Process
      • Protocol Involvement Post-Audit
      • Rescheduling and Cancellations
      • Interim Updates and Upgrades
    • 🕵️Watsons
      • Lead Senior Watson Selection Process
      • Fix Review Process
      • Contest Points
      • How to Score Issue Points in a Contest
      • Meeting the Payout Criteria
      • First Blood Pot
      • Leaderboard Points Example
      • FAQ
    • 🧑‍⚖️Judging
      • Judging Conduct Guidelines
      • Criteria for Issue Validity
        • Criteria Changelog
      • Lead Judge
      • 🧑‍⚖️Community Judging
      • Dedicated Judge
      • Discussion
      • Sherlock's Exclusive Judging Apprentice Program
    • 🤝Referral Program
  • Bug Bounties
    • 🌱Pre-Launch Bounty
    • 🚀Post-Launch Bounty
      • 📜Platform Rules
      • ⚖️Dispute Resolution
  • Coverage
    • 🛡️Sherlock Shield
    • 💰Stakers
      • Overview
      • Lockup Period
      • Payout Flow
      • Staking APY
    • 🧑‍💻Protocol Teams
      • Getting Started
      • Coverage Premiums
      • Pricing
      • Composability and Coverage
      • Payout Flow
      • FAQ
    • 📝Claims
      • Claims Process
  • Tokens
    • SHER
    • Receipt NFTs
  • Governance
    • Roles
  • Developer
    • Overview
    • Stake Position Lifecycle
    • Claim Lifecycle
    • Protocol Lifecycle
    • SHER Distribution
    • Deployed Contracts
    • Contract Reference
    • Audits
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  1. Coverage
  2. Stakers

Payout Flow

There are three important stages of a payout:

  1. The initial bug bounty submission or exploit event

  2. When the claim gets submitted

  3. When the claim gets paid out

Only stakers who are still locked up during the third phase will have to pay out. Any staker who unstakes funds before the actual payout (because they are in an unstaking window) will not have to pay out.

Each covered protocol will have a policy that is targeted to be 50% or less of the total Sherlock staking pool. This ensures that any single payout event at any single protocol can cause a payout for a maximum of 50% of the staking pool. More than 50% of the staking pool can be used for a payout if multiple covered protocols experience covered payouts in a short timeframe.

However, if the size of the bug bounty or exploit payout is smaller than the total coverage amount at a protocol, the size of the payout will be a fraction of the maximum coverage for that protocol. Also, if a bug bounty payout or exploit becomes possible on multiple protocols due to a chain bug (i.e. a bug in Ethereum L1), then no more than 50% of the staking pool can be used to repay those similar events, even if individual protocols had policies that aggregate to a sum that is larger than 50% of the staking pool.

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Last updated 1 year ago

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