📈Price Locked ETH (plETH)

Price Locked ETH is a derivative token that can be redeemed for ETH, but only if the price of ETH reaches the unlock price.

Each plETH token has a specific unlock price. The plETH tokens are fungible within the same unlock price, but non-fungible across strike prices. The underlying contract follows the ERC-1155 standard.

Staking plETH

To be eligible for redemption, plETH tokens must be staked.

Note that the staking process is typically done automatically on behalf of the user.

Staking lets the protocol know which prices apply to a particular set of plETH tokens. For example, consider the following example.

Alice stakes before the price rise, and Bob does it after

Alice buys and stakes plETH at an unlock of $10,000, and stakes it when the price is below that. The price goes up and above the unlock. Because Alice staked before the price rise, she can redeem her plETH for the underlying.

Then, some time passes, and the price dips below $10,000 again. Bob buys and stakes some plETH also. He can't redeem this plETH using the previous prices. He can only redeem if and when the price goes above $10,000 again.

Redeeming with plETH + ybETH

There is a second redemption mechanism. At any time, a user can take plETH and ybETH tokens at the same unlock price, and burn them to redeem the underlying.

For example, if Chad has 10 plETH and 10 ybETH, both at an unlock of $25,000, he can redeem those to for the underlying token. His plETH and ybETH tokens will be burned in this process.