> For the complete documentation index, see [llms.txt](https://docs.valantis.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.valantis.xyz/stakedhype/transparency-and-risks.md).

# Transparency and Risks

## stHYPE Health Reports

stHYPE Health Reports are internal documents produced once a month to snapshot key operations of stHYPE relevant to it's risk analysis.

* [stHYPE Health Report March 1 2026](https://github.com/ValantisLabs/audits/blob/main/stHYPE%20Health%20Report%20-%20March%201%202026.pdf)
* [stHYPE Health Report April 1 2026](https://github.com/ValantisLabs/audits/blob/main/stHYPE%20Health%20Report%20-%20April%201%202026.pdf)

## System Overview

stHYPE accepts HYPE deposits and issues stHYPE, with backing managed through HyperCore staking modules.\
At a high level, rewards and base unbonding constraints are determined by Hyperliquid network mechanics.

stHYPE operates with:

* standard HyperCore staking modules, and
* non-standard external-management stake accounts (currently HyENA HIP-3 and USDe quote-asset accounts), which may have different withdrawal and slashing characteristics.

## Risk Tier Snapshot (as of 2026-02-23)

| Module Class                                    | Current Usage              | Withdrawal Profile                                                        | Additional Slashing/Dependency Surface                                    |
| ----------------------------------------------- | -------------------------- | ------------------------------------------------------------------------- | ------------------------------------------------------------------------- |
| Standard HyperCore staking modules (5)          | Primary staking allocation | Targets standard queue path                                               | Base validator/network slashing risk                                      |
| HyENA HIP-3 external-management module (1)      | Non-standard allocation    | Can be materially longer in tail scenarios (up to documented max windows) | HIP-3 specific slashing and external stake-account execution assumptions  |
| USDe quote-asset external-management module (1) | Non-standard allocation    | Can be materially longer in tail scenarios (up to documented max windows) | Quote-asset slashing model + external stake-account execution assumptions |

Public dated status note:

* As of **2026-02-23**, the USDe quote-asset stake account has two spot-market deployed which can be monitored for slashing risk [USDe/USDC](https://app.hyperliquid.xyz/trade/USDE/USDC) and [HYPE/USDe](https://app.hyperliquid.xyz/trade/HYPE/USDE). Slashing requirements for these markets are outlined in [Permissionless Spot Quote Asset Slashing Docs](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/permissionless-spot-quote-assets). Liquidity depth, and historical compliance of these markets can be publicly verified onchain.
* HIP-3 slashing should be referenced against the HyENA HIP-3 DEX markets, marked officially as "hyna". [HyENA docs](https://docs.hyena.trade), [HIP-3 Slashing Docs](https://hyperliquid.gitbook.io/hyperliquid-docs/hyperliquid-improvement-proposals-hips/hip-3-builder-deployed-perpetuals#slashing).

See [Stake Accounts](/stakedhype/stake-accounts.md) for current inventory and withdrawal profiles.

## Core Constraints

### Base staking behavior

stHYPE rewards primarily track staking-related yield from HyperCore staking activity.\
All stHYPE-managed assets are intended for staking operations, not lending or discretionary trading strategies by the stHYPE contracts.

### Withdrawal behavior

Users can exit through:

* direct protocol burn/redeem paths, and/or
* secondary market liquidity where available.

Withdrawal timelines can vary depending on queue state and module mix.\
See [Integrate stHYPE](/stakedhype/integrate.md) and [Stake Accounts](/stakedhype/stake-accounts.md).

## Key Risk Areas

### Smart contract risk

Smart contracts can still contain vulnerabilities despite audits and testing.\
No documentation should be interpreted as eliminating smart-contract risk.

### Validator slashing risk

Hyperliquid validators can be slashed for protocol-defined failures.\
This is a core Proof-of-Stake network risk.

### Non-standard module slashing/operational risk

Non-standard stake accounts introduce additional trust and slashing surfaces beyond standard validator slashing:

* [HIP-3 slashing rules](https://hyperliquid.gitbook.io/hyperliquid-docs/hyperliquid-improvement-proposals-hips/hip-3-builder-deployed-perpetuals#slashing)
* [Permissionless quote-asset slashing rules](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/permissionless-spot-quote-assets)

## Governance and Control Transparency

* Current execution controls are role-gated and multisig-administered.
* No active on-chain veto mechanism currently enforces upgrades.
* No protocol-wide on-chain upgrade timelock is currently enforced for proxy upgrades.

Detailed control mapping:

* [Roles and Controls Registry](/stakedhype/roles-and-controls-registry.md)
* [Upgrade and Risk Governance](/stakedhype/upgrade-and-risk-governance.md)

## Monitoring and Incident Operations

Monitoring and incident-disclosure commitments are documented in:

* [Monitoring and Incident Response](/stakedhype/monitoring-and-incident-response.md)

## Financial Resilience and Loss Position

* There is currently **no guaranteed insolvency backstop** for user losses.
* Any future discretionary resilience framework would be published as a separate policy with explicit scope and limits.

## Security Program Status

* stHYPE currently does **not** run an active public bug bounty program.
* Security updates and operational controls should be interpreted together with:
  * [Contract Addresses](/stakedhype/contract-addresses.md)
  * [Roles and Controls Registry](/stakedhype/roles-and-controls-registry.md)