Stability Pool: Overview

The AgamaStabilityPool is the protocol's liquidation backstop and the secondary yield venue for lenders. It is an ERC-4626 vault with agYLD as its underlying asset and sagYLD as its share token.

What is `sagYLD`?

sagYLD is the share you receive when you stake agYLD in the Stability Pool. It is a vault share, not a 1:1 receipt. The share price (totalAssets / totalSupply) appreciates over time as the pool earns:

Supply APY through the underlying agYLD (which itself accrues interest from borrowers).
Liquidation premiums: when a borrower is liquidated, the SP burns agYLD to repay the debt and receives the seized collateral at a 3–8% discount. As that collateral is settled back into USDr by the SettlementVault and redeposited into the SP, totalAssets() grows and every sagYLD holder's share becomes redeemable for more agYLD.

The same mechanism runs in reverse if the pool absorbs bad debt: totalAssets() falls and every sagYLD holder takes a pro-rata loss. Risk and reward are symmetric.

sagYLD has 24 decimals (matching agYLD). It is a regular ERC-20 — transferable, but transferring it during a pending unstake forfeits the queued portion (see Cooldown below).

Pool composition

Every participant in the Stability Pool holds sagYLD shares and is treated identically by the contract — including the Reserve Fund and the Treasury. There is no privileged tier, no sub-account, no external accounting layer.

Participant	Why they're here
Retail stakers	Earn supply APY + liquidation premiums pro-rata to their `sagYLD`.
Reserve Fund	Stakes its capital here as a co-staker: earns pro-rata, absorbs pro-rata, signals protocol confidence by sharing the same risk surface as retail.
Treasury (testnet)	Stakes a portion of operational reserves to bootstrap pool depth before retail stakers ramp. Same pro-rata treatment as everyone else.

Worked example

Total sagYLD outstanding: 1,000,000.

Holder	`sagYLD`	Share
Reserve Fund	200,000	20%
Treasury	50,000	5%
Bob	10,000	1%
Charlie	50,000	5%
Other stakers	690,000	69%
Total	1,000,000	100%

A liquidation settles with 80,000 USDr of premium redeposited into the pool. The premium is not paid out as a separate token; it lifts the sagYLD share price. Per holder:

Holder	Share	Premium value at settlement
Reserve Fund	20%	16,000 USDr
Treasury	5%	4,000 USDr
Bob	1%	800 USDr
Charlie	5%	4,000 USDr
Other stakers	69%	55,200 USDr

This is pure ERC-4626 mechanics: every holder sees their sagYLD redeemable for more agYLD after settlement, no claim transactions required.

For a deeper walk-through of the yield stack and the honest pro-rata risk story, see Why participate?.

Why `agYLD`, not USDr

If the Stability Pool accepted USDr directly:

Depositors would lose the supply APY they would otherwise earn by holding agYLD.
The protocol would have two competing pools of USDr (main liquidity + the Stability Pool), complicating accounting and rate dynamics.
Liquidity in the Lending Pool would shrink, hurting borrowers.

By accepting agYLD, depositors continue to earn supply yield through agYLD appreciation, while also standing ready to absorb liquidations for an additional premium.

This is the single most frequently misunderstood aspect of the design. If you find yourself thinking "I should deposit USDr into the Stability Pool", re-read this section.

Cooldown on unstake

Unstaking is a two-step request-and-claim flow with a 7-day cooldown between them.

T+0     requestUnstake(amount)   → shares get earmarked, no burn yet
T+7d    claim(requestId)         → shares burn, agYLD transferred to user

The cooldown is configurable on-chain (cooldownDuration, default 7 days, governance-tunable).

Earmarked shares — important

When you call requestUnstake(amount), your shares are not burned. They are earmarked: still held in your wallet, still counted in sagYLD.totalSupply(), still absorbing liquidations.

earmarkedShares(user) returns the total amount currently sitting in pending requests for that user.
The shares only burn at claim time, against the share price at that future block.

This means:

You keep earning premiums during the cooldown, because your shares are still in the SP.
You also keep taking losses during the cooldown, because your shares are still backstopping liquidations.
If you transfer or withdraw your sagYLD before claim, the corresponding portion of the request is forfeited. The earmark mechanism prevents you from double-spending the shares — once they're earmarked, they belong to the queue.

This is deliberate. A safety net you can walk out of in seconds isn't really a safety net. The 7-day lock is the price of having a Stability Pool that actually works during a stress event.

Settlement extension

If a liquidation is mid-settlement when your cooldown would otherwise unlock, the unlock is automatically pushed out via settlementExtensionUntil. You can't escape mid-settlement — the SP needs your shares to absorb until the off-chain redemption clears.

In practice the extension is at most a few days. The view getRequest(user, id) returns unlockAt already adjusted for any active extension.

Pending requests

A user can have multiple pending requests at once.

pendingCount(user) — number of open requests.
getRequest(user, id) — full request struct (amount, requestedAt, settlementExtensionUntil, claimed flag).

Each request is independent: one can be claimable while another is still locked.

Same-block protection

depositBlock[user] is recorded on every deposit. Operations that would depend on the deposit (e.g. exiting in the same block) revert. Blocks flash-loan-assisted ephemeral deposits.

Continue

Why participate?: the yield stack and the honest pro-rata risk story.
Functions: complete function reference.
Liquidations: the single-step seizure flow + the ~15-day off-chain settlement window.