Question 1

What is SD?

Accepted Answer

SD is the governance and utility token of the Stader Labs ecosystem. It is used both for voting on StaderDAO proposals and in connection with ETHx node operator bonds, Utility Pool delegation, and ecosystem incentives; therefore, it is not equity, a dividend, or a redemption claim in Stader Labs. These uses correspond respectively to protocol decision-making, Ethereum validator operations, and liquidity/community participation. Whether SD is actually required or received depends on the rules of the product being used at the time, rather than rights or returns arising automatically from merely holding the token.

Question 2

What can SD holders participate in?

Accepted Answer

SD holders can vote through StaderDAO on key proposals and plans, participating in protocol-level decisions. Voting power affects whether proposals are executed according to their rules; it does not grant ownership of the Stader Labs company. Matters governance can affect include governance-decided incentive releases, ecosystem initiatives, and use of DAO funds; specific eligibility, snapshots, voting thresholds, and execution methods are subject to the relevant proposals.

Question 3

How is SD related to ETHx node operations?

Accepted Answer

In ETHx node operations, SD can serve as part of a node operator bond: official information states that node operators can run a validator using SD worth 0.4 ETH. This bond links part of the risk of node performance with demand to lock SD. If a node has a slashable event, SD also has a role related to coverage for slashing risk. Therefore, the bond is not an ordinary transfer fee; its applicability, locking, and risk outcomes depend on ETHx node operation rules.

Question 4

What are SD's supply and allocation?

Accepted Answer

SD has a maximum supply of 120 million tokens. This figure comes from a 2024 tokenomics adjustment: Stader burned 30 million SD, reducing total supply to this cap, so historical supply figures from before the adjustment should not be mixed with the current cap. The cap is allocated as follows: Rewards and Liquidity Incentives 38.75% (46.5 million tokens), Team and Advisors 21.25% (25.5 million tokens), Private Sale 21.25% (25.5 million tokens), Public Sale 5% (6 million tokens), and Ecosystem and DAO Fund 13.75% (16.5 million tokens). The cap does not equal the tradable circulating supply at any given time.

Question 5

How do SD buybacks affect token supply?

Accepted Answer

Stader's arrangement is to use 20% of annual revenue for quarterly open-market SD buybacks. The direct process of a buyback is to use that portion of revenue to purchase SD on the market; if the purchased tokens leave tradable circulation, circulating supply decreases accordingly. This is a tokenomics arrangement, not a fixed-price mechanism: the buyback size depends on annual revenue and execution, while market sell pressure, liquidity, and other changes in demand can still affect price and tradable supply.

Question 6

What other uses does SD have in the ecosystem?

Accepted Answer

SD is used to incentivize liquidity providers, ETHx node operators, and community contributors. Incentives reward specific ecosystem behaviors rather than paying fixed returns to all SD holders. Participants must meet the eligibility and operational conditions of the relevant pool, node, or activity; providing liquidity may also involve asset price changes and impermanent loss, while node-related participation additionally depends on node performance and protocol rules.

Question 7

What risks should be considered when using or holding SD?

Accepted Answer

The main risks of holding or using SD include token price and liquidity volatility, as well as smart-contract, node-performance, and rule-change risks arising from participation scenarios. SD's governance and utility do not eliminate these risks. For example, outcomes from liquidity participation are affected by both the relative prices of assets in the pool and reward rules; providing SD support for nodes is also connected to the relevant bond and slashing-risk arrangements. Confirm the network, contract, and product rules before operating.

Question 8

How are SD ecosystem incentives arranged?

Accepted Answer

Rewards and liquidity incentives account for 38.75% of the SD cap, or 46.5 million tokens, and are intended to encourage liquidity and ecosystem participation. When, through which activities, and in what amounts this portion is released are determined by governance proposals. Therefore, the total allocation describes an amount available for incentives, rather than rewards that any participant is certain to receive. Actual rewards also depend on participation eligibility, activity rules, and governance arrangements approved at the time.

Question 9

What is the SD Utility Pool?

Accepted Answer

The SD Utility Pool allows SD holders to delegate SD to the pool, providing ETHx node operators with the required SD support. It addresses situations where node operators want to run validators with ETH exposure but still need to meet SD-related bond requirements. Node operators allocate a portion of their rewards to the pool in order to obtain protection related to slashing risk; whether delegators receive rewards and what risks they bear depend on the pool's specific rules and are not equivalent to ordinary token holding.

Question 10

Will team and private-sale SD enter circulation all at once?

Accepted Answer

The Team and Advisors allocation accounts for 21.25%, or 25.5 million tokens, and is subject to a 6-month cliff followed by linear vesting over 36 months; therefore, it is not all unlocked at once at token generation under this arrangement. The Private Sale allocation is also 21.25%, or 25.5 million tokens: 0% to 5% unlocks at the token generation event, with the remainder vesting linearly over 36 months after the token generation event. The vesting schedule affects the release pace but does not promise market price or actual selling behavior.

Question 11

What is the role of the DAO and ecosystem fund?

Accepted Answer

The Ecosystem and DAO Fund together account for 13.75%, or 16.5 million tokens, and are used for governance-decided initiatives. Their function is to reserve token resources for ecosystem initiatives, rather than to pre-allocate a fixed amount to all holders. From a proposal to actual use, governance generally needs to decide the specific purpose before implementation occurs under approved arrangements; therefore, distinguish the fund's total allocation, approved initiatives, and tokens already released or used.

Question 12

Is SD a principal-protected or fixed-income product?

Accepted Answer

SD is not a principal-protected or fixed-income product. Its value connections arise from mechanisms such as governance, node bonds, the Utility Pool, incentives, and buybacks, but these mechanisms do not promise principal, fixed returns, or a particular price. Protocol usage, revenue, governance execution, token locking, and market liquidity can all change the relevant conditions; even when participating in a reward mechanism, its eligibility and risk rules must be met.

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