ENCOINS v2: privacy protocol on Cardano. DApp development and integrations

[GENERAL] Name and surname of main applicant

Vladimir Sinyakov

[GENERAL] Email address of main applicant

team@encoins.io

Additional applicants

NA

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

8

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language.

No

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.” .

No dependencies.

[GENERAL] Will your project’s output/s be fully open source?

Yes

[GENERAL] If NO, please describe which outputs are not going to be open source. If YES, please write “Project will be fully open source.”

The project will be fully open source.

[METADATA] Category of Proposal

dApp

[IMPACT] Please describe your proposed solution.

A brief description of the ENCOINS protocol

ENCOINS is a privacy protocol on Cardano. Users can create NFTs (a.k.a. encrypted coins or encoins) with secret redeeming values. These NFTs store their redemption values (ADA) in the encrypted format using zero-knowledge proofs. A user can burn a coin to redeem its value from the protocol. You can send, gift, or trade encoins as any other NFT.

The protocol has a second mode of operation called the ENCOINS Ledger Mode. In this mode, users can store their coins directly in the protocol (at the Cardano script address). Thus, it is possible to make confidential payments even without having a Cardano wallet.

We have several partnerships inside the Cardano ecosystem currently in the works. All of them provide meaningful, practical use cases for the protocol. Some could be announced any day now.

The components of our solution

Redesign UI to be more wallet-like but with additional privacy features.

Following the feedback from our community, we want to streamline user interaction with the protocol by hiding its complexity from the users. The wallet-like UI will be more familiar to a typical user, increasing our protocol's adoption.

Design, document, and implement a set of public APIs to query the on-chain state of the protocol and build protocol transactions.

It will allow other Cardano DApps and services to access the protocol programmatically, increasing the potential for collaborations and integrations. It also opens the door for more direct integrations with the existing Cardano wallets (for example, a button that encrypts/decrypts selected assets in the wallet).

Build frontend for the Agora-based DAO.

In our efforts toward full decentralization, it is critical to transition the ENCOINS DAO treasury from the current multi-signature script to an Agora-based smart contract. To do so, we need to connect Agora smart contract and existing APIs to our own frontend. After considering different options, we believe it to be a better solution.

Make the most out of our partnerships.

The team size limits the extent to which we can collaborate with our partners. With the additional funding provided by this grant, we could hire an additional smart contract/frontend developer who will focus on integrations.

[IMPACT] How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?

The more user needs we, as the developer community, can satisfy, the faster Cardano will grow. We have received many requests for features and collaborations ranging from a system that protects NFT collectors from tracking to confidential payments for refugees. With ENCOINS v2 and the proposed development roadmap, we could satisfy those needs, bringing more people to the Cardano ecosystem and increasing value for the existing users.

[IMPACT] How do you intend to measure the success of your project?

Once our project launches on the mainnet, we will track the number of transactions and TVL of the protocol.

In addition, the success will be measured in the number and quality of collaborations with other ecosystem projects.

Finally, we value and consider the opinion of our community and our fellow ecosystem builders.

[IMPACT] Please describe your plans to share the outputs and results of your project?

The output of this project is a permissionless Dapp that will be available to all Cardano users. As the project is open-sourced, the code will be shared as well. We have built and continue to improve our own developer tools that might be of interest to the Cardano developer community. More on that, check out our proposal in the OSDE category.

[CAPABILITY/ FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability?

We have already delivered ENCOINS v1 (now on the testnet). ENCOINS v1 was the goal of our previous Project Catalyst proposal back in Fund6. Though we initially underestimated the realistic deadlines for that project, we over-delivered in terms of what was promised, not only building a private transaction protocol but also creating reusable open-source components for the ecosystem, designing a decentralized token distribution protocol, and providing quality end-to-end code examples of Cardano applications.

The team consists of highly skilled Haskell developers and is led by a Ph.D. in applied math with five years of postdoc experience.

[CAPABILITY/ FEASIBILITY] What are the main goals for the project and how will you validate if your approach is feasible?

The main goal of this project is to provide Cardano users with a confidential transaction solution. We assume that by satisfying more people's needs, we bring more users to the ecosystem and increase engagement and opportunities within the ecosystem. For example, we have received many requests to add an "NFT encryption" feature to make owning an extensive NFT collection safer and more secure. This will be solved with the native asset support feature.

Please see also the section above on measurable metrics.

The feasibility of our approach is partially validated by the fact that version one of the protocol is already running on the Cardano testnet at app.encoins.io.

[CAPABILITY/ FEASIBILITY] Please provide a detailed breakdown of your project’s milestones and each of the main tasks or activities to reach the milestone plus the expected timeline for the delivery.

Milestone 1: Public APIs become available.

2 month

Milestone 2: New UI is implemented and mainnet ready.

2 month

Milestone 3: The DAO UI is implemented and tested.

2 month

Milestone 4: Two collaboration projects are complete.

2 month

[CAPABILITY/ FEASIBILITY] Please describe the deliverables, outputs and intended outcomes of each milestone.

Milestone 1: The documentation and the code for the public APIs. Tests.

Milestone 2: The code for the new UI. Tests.

Milestone 3: The DAO UI. Tests.

The goal is to move our project's treasury to an Agora-based DAO and provide the community with a way to interact with it.

Milestone 4: The development part for the collaborations is complete.

[RESOURCES & VALUE FOR MONEY] Please provide a detailed budget breakdown of the proposed work and resources.

APIs implementation: 320 hours

Additional UI/UX design: 20 hours

New UI implementation: 200 hours

DAO UI implementation: 320 hours

Collaborations: 240 hours

Total hours: 1100

Total cost: 66 000 $

[RESOURCES & VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

This is a relatively big project with the goal of producing a unique, best-in-class protocol and DApp. We estimate the project to span over eight months. The average cost of development per hour is 60$ (slightly higher than in our second proposal due to outsourcing).

[IMPORTANT NOTE] The Applicant agreed to Fund10 rules and also that data in the Submission Form and other data provided by the project team during the course of the project will be publicly available.

I Accept