- Until it chooses to opt into EigenLayer slashing, the Renzo protocol faces no EigenLayer slashing risk. None of the AVSs integrated with Renzo have activated slashing functionality. Even if slashing is enabled by an AVS in the future, it will only apply to operators who have explicitly opted in.
- Slashing on EigenLayer is not enabled by default. Slashing participation is entirely opt-in and will be gated by a thorough assessment process.
- The updated slashing framework gives AVSs the authority to implement customized slashing policies. Penalties are strictly confined to the Unique Stake that operators commit to each AVS.
- The introduction of Operator Sets and Unique Stake could potentially provide operators with flexible tools to actively manage and balance reward potential against risk exposure.
With EigenLayer set to enable slashing on mainnet starting April 17, 2025, Chaos Labs is closely evaluating the implications of this upgrade—examining both the potential risks it introduces and the strategic opportunities it presents to strengthen Renzo’s risk management framework.
As part of its broader security overhaul, EigenLayer is introducing three core architectural updates:
Operator Sets
Operator Sets introduce a flexible grouping mechanism that allows AVSs to assign tasks and responsibilities to curated subsets of operators. Each set has its own distinct parameters, including custom reward logic and slashing criteria. This setup gives operators the autonomy to engage only with sets that reflect their technical strengths and risk appetite by allocating their stake accordingly. If an operator or delegator becomes uneasy with the evolving risk dynamics of a particular set, they have the option to exit. However, any decision to deallocate comes with a built-in 14-day delay—during which the stake remains vulnerable to slashing events, even after initiating the withdrawal process.
Unique Stake
The concept of Unique Stake introduces a more controlled way for operators to commit portions of their staked capital to individual Operator Sets within a given AVS. Each portion of unique stake can only be assigned to one Operator Set at a time, and the total assigned stake can never exceed the operator’s overall holdings. As a result, there’s no double-counting of risk, and only the AVS receiving the allocation has the authority to slash that specific segment of stake. This marks a significant improvement over previous models, where a single failure could jeopardize an operator’s entire position across multiple services. To protect stakers, operators must observe an Allocation Delay before any new allocation takes effect. This built-in buffer gives stakers time to evaluate the potential impact of the operator’s decision. If the new allocation presents a risk they aren’t comfortable with, stakers have the opportunity to exit.
Slashing Module
The newly launched slashing framework empowers AVSs to directly penalize operator misbehavior. When triggered, a slashing event irreversibly removes a portion of the operator’s staked assets, sending it to a burner address on the protocol. Renzo’s operators retain full control over their exposure to slashing risk. They determine when and if to participate in slashing-enabled AVSs, based on their own risk tolerance and protocol-level governance. This opt-in model ensures that operators are never involuntarily subjected to slashing. Furthermore, operators can decide how much of their stake they can be set up for slashing by a given AVS.
The slashing logic is defined and enforced entirely by each AVS, rather than by EigenLayer’s core contracts. This enables AVSs to tailor slashing penalties to specific operational criteria, adjusting both the scope and severity of enforcement based on task type and failure modes. AVSs may also implement additional layers of protection such as time delays, challenge windows or fraud proofs.
Rewards v2
The updated design also introduces fee customization at the Operator Set level, giving operators the ability to define their own commission rates for each set they participate in. Unless manually set, the default fee is 10%.
Risk Considerations
These considerations become relevant only when Renzo’s operators opt into the Operator Set and Unique Stake framework. This decision will involve detailed assessment of each AVS, with a focus on its slashing configuration, protective measures, and alignment with our AVS Risk Assessment Methodology.
From a risk management standpoint, Unique Stake allocations should be treated as distinct, quantifiable exposures—akin to VaR buckets. This approach allows for more precise oversight and encourages diversification across Operator Sets to reduce the impact of correlated slashing events. Operators and stakers alike should stay mindful of protocol-level withdrawal delays.
Given the absence of protocol-level protections around slashing, participation in any slashing-enabled AVS should be preceded by rigorous evaluation. Delegation should be limited to AVSs that demonstrate a commitment to transparent, well-documented slashing procedures and that have implemented clear, enforceable safety mechanisms.
On the incentives side, operators gain greater flexibility over both earnings and risk by selectively allocating stake. This precision in reward calibration may enhance yield potential on ezETH, as operators pursue higher-value opportunities aligned with their strengths.
Once the REnzo protocol chooses to engage with slashing-enabled AVSs, we recommend implementing a comprehensive monitoring framework capable of tracking operator fees, slashing events, and stake allocations in real time. Ongoing, active oversight will be essential to sustaining competitive yields while ensuring risk exposure remains well-managed.