AVS

The AVS serves as an entry point for vault deposits, enables Operators to allocate the delegated LST to Aleph Vaults, and functions as a trustless issuer of proof of redistributed collateral (alETH). The system manages accounting records for all participants, calculates rewards, and streamlines transactions among participants.

Allocation

When an Operator allocates to a Vault, the AVS uses EigenLayer's redistribution mechanism to move LST from the Operator's delegation into the Vault. This isn't slashing in the punitive sense — it's a controlled reallocation of capital.

The AVS validates that the Vault is factory-deployed, checks that the Operator's split is set to 0% (ensuring 100% of rewards flow to restakers), and confirms the NAV is fresh. If all checks pass, the Vault mints shares and the AVS mints equivalent alETH in a single atomic transaction.

alETH

alETH is a proof of redistributed collateral. Each alETH represents one Vault share and maintains EigenLayer delegation properties — restakers keep their security guarantees while their capital works inside a Vault.

alETH is fungible regardless of which series it originated from. Its value grows as the underlying Vault NAV increases.

Unallocation

Any alETH holder can redeem through a two-step process:

1. Request Unallocation: Call requestUnallocate() on the AVS to burn alETH tokens and request redemption from the Vault. The estimated redemption amount is tracked as pending.

2. Complete Unallocation: Once the Vault has processed the redemption request and has redeemable funds available, call completeUnallocate() to withdraw the LST and deposit it back into the holder's EigenLayer strategy position.

The restaker's stake returns to EigenLayer, still delegated, ready to be reallocated elsewhere or withdrawn.