PANews reported on May 9 that according to the official announcement, Ethereum re-staking protocol EigenLayer announced that it will launch the "redistribution of confiscated funds" upgrade on the main network in June, which is an advanced function of its Slashing mechanism. This function allows the Active Verification Service (AVS) to allocate confiscated funds to designated recipients instead of directly destroying them. The first batch supports LST, EIGEN, USDC and AVS tokens (excluding ETH for the time being). The test network is scheduled to be deployed on networks such as Holesky in May.
This upgrade is an optional feature. AVS can design an incentive structure of "punishing invalid nodes-rewarding reliable nodes", but it needs to be equipped with enhanced key management (to prevent slasher modules from being attacked) and smart contract security (multi-signature architecture/vetoable slashing mechanism is recommended). The agreement emphasizes that AVS needs to carefully design redistribution rules to avoid incentive distortions, such as balancing risk and return through fixed slashing conditions. The redistribution mechanism provides a new paradigm for scenarios that require liquidity, such as lending and insurance, such as using slashing funds for user compensation or liquidation buffers.
