Potential deadlocks when slashed

In many parts of the code, it is assumed that LSTs would never decrease in value.

These assumptions, when violated, have effects ranging from deadlocks to incorrect economic incentives. LSTs, however, can decrease in value if the backing validator(s) are slashed.

While there is no automatic mechanism to slash validators on Solana, attackers causing the network to halt can be manually slashed upon network restart. While the risk of this happening is low, the Pye team should still consider updating the protocol to correctly handle slashing in order to future-proof the protocol.

This issue has been acknowledged by Pye in the Sky Labs Ltd., and a fix was implemented in commit 59c31eef↗.