# Keep stakedrop risks and mitigation strategies

**“I want to stake ETH in the incoming Keep stakedrop. What are the ways I could lose my ETH?”**

If you are asking yourself this question, this document is for you. We will attempt to cover the different ways you could lose the ETH you staked and the different ways you could mitigate these risks.

## Risks involved with staking your ETH in the stakedrop

**Smart contract bug**
* Ways this could happen : All Ethereum smart contracts you trust with your ETH could be affected by smart contracts bugs.
* Effect : Losing some or all of your ETH.

**One of the signers in your group fails to respond to a redemption request**

If any of the three nodes in the signing group fails to respond to a redemption request under two hours, you will get slashed even if you were not the one that failed to respond.

* Ways this could happen :
-Node offline for more than two hours after redemption request
-Node software bug
-Malicious actor intentionnaly not responding to a request
* Effect :
-ETH auctionned of to pay off tBTC debt, 1/2 of the remainder given back to signing group
-BTC still under control of the signing group, with coordination necessary to split the BTC between the different signers.

**Your signer group gets liquidated from under-collateralization**

If your collateralization ratio goes below 125% ETH per BTC for more than 6 hours, your group will get liquidated and lose Ether. If your collateralization ratio ever goes below 110%, you will lose Ether. You cannot add Ether to your position. You will have to take exit ( see mitigation strategies section below) to save your ETH.
* Ways this could happen :
-Your Group does not respond quickly enough
-ETHBTC ratio instaneously drops more than 15%, leaving you no time to react
-Oracle bug or manipulation making appear the ETHBTC ratio lower than it truly is
* Effect
-ETH auctionned of to pay off tBTC debt, 1/2 of the remainder given back to signing group
-BTC still under control of the signing group, with coordination necessary to split the BTC between the different signers.

**Your group provides a fraudulent signature**

If your collateralization ratio goes below 125% ETH per BTC for more than 6 hours, your group will get liquidated and lose Ether. If your collateralization ratio ever goes below 110%, you will lose Ether. You cannot add Ether to your position. You will have to take exit ( see mitigation strategies section below) to save your ETH.

* Ways this could happen :
-Your node gets hacked to sign a malicious signature
* Effect :
-All ETH is lost
-BTC still under control of the signing group, with coordination necessary to split the BTC between the different signers.

## Risk mitigation strategies

**Host your nodes on environments with the lowest downtime possible**
Consider using Virtual private servers on sites like AWS, Digital Ocean or Google Cloud instead of hosting your node locally to ensure more up-time and reliability.

**Spread your ETH amongst multiple nodes**
If you are worried about losing your ETH because you are in the group with an unresponsive or malicious actor, spreading your ETH amongst multiple nodes can help reduce the chance of losing your ETH. This way, if you are stuck with a malicious or unresponsive operator, only a small portion of your ETH will be exposed.

**Spread your nodes amongst multiple VPS providers**
If there is ever downtime with a single VPS provider, only your nodes present on this particular VPS provider will be affected. This way, only part of your ETH will be affected if there ever is downtime at a critical moment.

**Make sure to monitor the ETHBTC ratio carefully**
If you are ever under the 125% threshold, you will be able to exit your position by buying the amount of tBTC needed and redeeming the BTC secured by your signing group. This will secure your ETH bond. You can also consider using a script to automatically monitor the ETHBTC ratio and automatically redeem the BTC if necessary.

Written by StateLayer, Keep Community Member. Not official info or documentation.