Restacking mechanism explained

DUO's Restacking Process Overview

At its core, DUO’s restacking process is designed to aggregate multiple compatible yield sources into a single liquid position, represented by a derivative restaked token (DRST).

1. Minting Pools

For each supported asset, DUO maintains a dedicated minting pool. Depositors send an already staked version of the base asset — for example, wstETH, which itself represents:

• ETH collateral on Ethereum,

• The base ETH position,

• Native staking rewards from Lido.

These staked tokens form the underlying collateral for DUO’s restaking layer.

2. Additional Yield Layer — Aurex Integration

Beyond the base staking yield, DUO deploys its pooled liquidity into Aurex, a platform providing:

• Collateralized lending to borrowers,

• Leverage trading on tokens within the 0Fx ecosystem.

This generates an additional stream of interest income on top of the staking rewards, while maintaining strict liquidity management to avoid any withdrawal delays.

3. Fee Layer

A share of DUO’s minting fees is also distributed back to DRST holders, adding a third source of yield to the position.

4. Withdrawal & Liquidity

No lock-up — DRST tokens are fully liquid and redeemable at any time. A dynamic rollover system manages the funds deployed to Aurex, ensuring exposure never exceeds safe liquidity thresholds, thereby preventing withdrawal bottlenecks.

5. Compounded Value

Native rewards from all sources — staking, Aurex lending/trading interest, and minting fee share — are automatically reflected in the net asset value (NAV) of the DRST token. For example:

• wstETH = ETH + staking yield (Lido)

• DRST-ETH = ETH + staking yield + Aurex lending/trading yield + DUO minting fee share

This model enables three yield streams in a single token, with no compromise on liquidity.