Lockups need to be introduced on the stability vault because a whale could attack and depeg the stablecoin.
A whale can borrow USDH from both solend or port finance. Take borrowed USDH, and deposit it into the stability vault. If a said whale is big enough he would also likely push down the price of BTC, to trigger a market downtrend or market just goes down due to some unforeseen macroevent. Then the whale will then remove the USDH from the stability vault, causing it to be under collateralized relative to the amount of USDH needed to cover loans (this will likely cause panic among platform users, as even the serum whale spooked users when tons of USDH was minted and deposited into the stability vault).
If the stability vault goes to 0 USDH, loans can and will slip above the 80% LTV liquidation threshold thus causing, USDH to no longer be an overcollateralized stablecoin. Users sell USDH to retreat to another asset, destroying the project.
Have a 5 day lock up with 20% withdraws on the initial deposit. For example, if a user deposited $100 into the stability vault, they can withdraw $20 Day 1, $20 Day 2, $20 Day 3, $20 Day 4, and $20 Day 5.
This ensures vault stability when markets reach volatility.
This Improvement proposal will be updated to eventually reflect USDH lockups on the stability vault once further understanding of veHBB and available HBB is disclosed. For now, focus on the 5-day/20% withdrawal protection.