Cohomological and K-theoretic stable bases originated from the study of quantum cohomology and quantum K-theory. Restriction formula for cohomological stable bases played an important role in computing the quantum connection of cotangent bundle of partial flag varieties. In this paper we study the K-theoretic stable bases of cotangent bundles of flag varieties. We describe these bases in terms of the action of the affine Hecke algebra and the twisted group algebra of KostantKumar. Using this algebraic description and the method of root polynomials, we give a restriction formula of the stable bases. We apply it to obtain the restriction formula for partial flag varieties. We also build a relation between the stable basis and the Casselman basis in the principal series representations of the Langlands dual group. As an application, we give a closed formula for the transition matrix between Casselman basis and the characteristic functions.
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