Lenfi Voltaire: Enable ADA Liquidity for Drep delegation

[GENERAL] Name and surname of main applicant

Mantas Andriuska

[GENERAL] Are you delivering this project as an individual or as an entity (whether formally incorporated or not)

Individual

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

6

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

No

[GENERAL] Summarize your solution to the problem (200-character limit including spaces)

We will upgrade Lenfi to support permissionless ADA delegation to DRep via smart contracts. This will include integration from smart contracts to off-chain and UI.

[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] Please provide here more information on the open source status of your project outputs

Whole code under MIT License

[METADATA] Horizons

DeFi

[SOLUTION] Please describe your proposed solution

We aim to solve the issue of ADA liquidity within DeFi protocols not contributing to Cardano's decentralized governance. Right now, ADA locked in protocols doesn’t participate in governance, limiting its effectiveness.

Our proposal is to implement the Lenfi Voltaire upgrade, which will merge Cardano’s decentralized governance capabilities with Lenfi’s platform. This upgrade will allow pool managers to delegate their voting power to decentralized representatives (DReps) in a permissionless manner. Pool Managers, through the Lenfi UI or using SDK, will have the ability to publish certificates enabling this delegation.

This solution benefits ADA holders, Pool Managers, and DReps by ensuring that ADA liquidity plays an active role in governance. It’s important for Cardano’s ecosystem because it enhances participation and demonstrates how DeFi protocols can incorporate governance features, setting an example for others. This approach also increases engagement by involving more stakeholders in decision-making.

[IMPACT] Please define the positive impact your project will have on the wider Cardano community

The Lenfi Voltaire upgrade will benefit the Cardano community by enabling ADA liquidity within DeFi protocols to contribute to decentralized governance. This will boost participation and decentralization across the ecosystem.

It will demonstrate a real-world example of over 7M ADA being managed by independent DeFi users and delegated to DReps.

Additionally, it will increase active governance and permissionless voting power allocation to DeFi-related DReps.

[CAPABILITY & FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

We can write Aiken code to update the smart contract and build a full Cardano application, covering everything from smart contracts to UI interactions.

[PROJECT MILESTONES] What are the key milestones you need to achieve in order to complete your project successfully?

A: Milestone Outputs

• Upgrade Lenfi Smart Contracts to Plutus V3: Migrate the existing Lenfi smart contracts to the latest Plutus V3, enhancing functionality and performance.
• Implement Voltaire Decentralized Governance Functionality: Integrate governance features that align with Cardano's Voltaire era, enabling community-driven decision-making within the Lenfi platform.
• Provide Publicly Available Code with Valid Aiken Smart Contracts: Release the upgraded smart contracts written in Aiken to a public repository, ensuring transparency and community collaboration.
• Develop On-Chain Tests for Permissionless Delegation: Create comprehensive on-chain tests to verify that permissionless delegation works seamlessly within the new governance framework.

B: Acceptance Criteria

• Successful Upgrade to Plutus V3: The Lenfi smart contracts are fully updated to Plutus V3 and compiled using Aiken
• Operational Governance Features: Voltaire decentralized governance functionalities are implemented and accessible to users for participating in decision-making processes.
• Public Code Accessibility: The updated Aiken smart contracts are available in a public code repository, accompanied by clear documentation.
• Passing On-Chain Tests: All on-chain tests for permissionless delegation pass successfully, confirming the feature's reliability and effectiveness.

C: Evidence of Milestone Completion

• Code Repository Link: A URL to the public repository (e.g., GitHub) containing the upgraded Plutus V3 smart contracts and Aiken code.
• Deployment Confirmation: Proof of deployment on the Cardano testnet or mainnet, including transaction IDs or contract addresses.
• Test Results Documentation: Detailed reports or logs showing the execution and success of on-chain tests for permissionless delegation.
• Demonstration of Governance Functionality: Screenshots, videos, or user guides illustrating how users can engage with the new Voltaire governance features.
• Community Feedback: Collection of feedback or endorsements from initial users or community members who have interacted with the upgraded platform.

A: Milestone Outputs

• Complete Testing and Implement Off-Chain Transaction Generation: Finalize the testing phase and implement the off-chain code necessary for building the delegation transaction body.
• Launch New SDK Version with Updated Functionality: Release the updated version of the Lenfi SDK, incorporating the new delegation features, and make it publicly available at https://www.npmjs.com/package/lenfi-sdk.
• Execute Preview Network Transaction: Perform a transaction on the Cardano preview network where ADA is delegated to a DRep and validated using the Lenfi pool validator at hash 32e8c0ae314ef4be452c16a999867f66d1a1791fc972cb2f7c74e38d.

B: Acceptance Criteria

• Successful Testing and Implementation:
• All tests for the off-chain transaction generation code pass without errors.
• The code correctly builds the delegation transaction body as intended.
• SDK Release:
• The new version of the Lenfi SDK is published on npmjs.com with the updated delegation functionality.
• Release notes or changelog detailing the new features are provided.
• Verified Preview Network Transaction:
• The delegation transaction is successfully executed on the preview network.
• ADA is delegated to the DRep and validation occurs via the specified Lenfi pool validator hash.
• The transaction is visible and verifiable on the Cardano preview network explorer.

C: Evidence of Milestone Completion

• Test Reports:
• Provide documentation or screenshots showing all tests passing for the off-chain transaction generation code.
• Include code snippets or logs demonstrating the successful building of the delegation transaction body.
• SDK Publication:
• Link to the updated Lenfi SDK on npmjs.com: https://www.npmjs.com/package/lenfi-sdk.
• Include screenshots of the package page showing the new version number and release date.
• Attach the release notes or changelog highlighting the new delegation features.
• Transaction Proof:
• Provide the transaction ID or hash of the executed delegation transaction on the preview network.
• Include a link to the transaction details on the Cardano preview network explorer.
• Screenshots showing the delegation of ADA to the DRep and validation via the Lenfi pool validator hash 32e8c0ae314ef4be452c16a999867f66d1a1791fc972cb2f7c74e38d.
• Documentation and Guides:
• Any updated documentation or user guides explaining how to use the new delegation features in the Lenfi SDK.
• Examples or tutorials demonstrating the off-chain transaction generation process.

A: Milestone Outputs

• Backend Infrastructure Development:
• Build the backend systems necessary for indexing and tracking voting power delegation on the Cardano blockchain.
• Implement chain indexing to monitor delegation events and changes in real-time.
• Develop data pipelines to process and store delegation data efficiently.
• Create API endpoints to allow external clients and applications to access delegation data.
• Pre-Production (PreProd) Network Client:
• Develop a client application on the PreProd network that enables ADA holders to delegate their stake to a DRep (Delegated Representative).
• Integrate the client with the backend infrastructure to display real-time changes in delegation on the user interface (UI).

B: Acceptance Criteria

• Functional Backend Infrastructure:
• The backend system accurately indexes and tracks all voting power delegation events on the PreProd network.
• Data pipelines are processing and storing data without loss or significant delay.
• API endpoints are operational, secure, and provide the necessary data to clients as per the specifications.
• Operational PreProd Network Client:
• Users can successfully delegate ADA to a DRep using the client application.
• The UI reflects changes in delegation status promptly after transactions are confirmed on the blockchain.
• The client is user-friendly and performs reliably under expected network conditions.
• Security and Performance:
• The system meets security standards to protect user data and prevent unauthorized access.
• Performance benchmarks are met, ensuring that indexing and data retrieval occur within acceptable time frames.

C: Evidence of Milestone Completion

• Backend Infrastructure Proof:
• PreProd client will successfully allow to delegate and will update the changes visually on UI.
• PreProd Network Client Demonstration:
• A link to the client application or instructions on how to access it.
• Transaction IDs or hashes of test delegations performed using the client, which can be verified on the PreProd network explorer.
• User Guides and Documentation:
• User manuals or quick-start guides to help users navigate the client application.
• Technical documentation for developers who may want to interact with the API or contribute to the project.

A: Milestone Outputs

• Create Public Announcements:
• Develop and release at least three public announcements about the upcoming feature and its significance.
• Channels to be used: X (formerly Twitter), Telegram, and Discord.
• Educate Liquidity Depositors:
• Prepare educational content to guide liquidity depositors on how to migrate their liquidity.
• Content includes step-by-step instructions and FAQs.
• Publish Detailed Guide on Gitbook:
• Create a comprehensive guide covering all aspects of the new feature and the liquidity migration process.
• Share the guide publicly via a Gitbook link.

B: Acceptance Criteria

• Public Announcements Released:
• At least one announcement posted on each of the following platforms: X, Telegram, and Discord.
• Announcements clearly explain the upcoming feature and its importance.
• Educational Materials Available:
• Guidance for liquidity depositors is complete, accurate, and easy to understand.
• Information on how to migrate liquidity is accessible to all users.
• Gitbook Guide Published:
• The detailed guide is live on Gitbook and accessible to the public.
• The guide includes visuals, tutorials, and comprehensive information about the feature and migration process.
• Community Engagement:
• Users interact with the announcements (e.g., likes, comments, shares).
• Initial feedback indicates that liquidity depositors understand the migration process.

C: Evidence of Milestone Completion

• Links to Announcements:
• Provide URLs or screenshots of the announcements on X, Telegram, and Discord.
• Gitbook Guide Link:
• Share the public link to the Gitbook guide.
• User Engagement Metrics:
• Screenshots or data showing user interactions with the announcements (number of views, likes, comments).
• Feedback from Liquidity Depositors:
• Collect and present testimonials or comments from users who have read the guide or participated in the migration process.
• Educational Material Samples:
• Include excerpts or snapshots of the educational content provided to liquidity depositors.

A: Milestone Outputs

• Launch of the New Lenfi UI Mainnet Client:
• Deploy the updated Lenfi user interface on the Cardano mainnet, providing users with enhanced features and functionalities.
• a) Liquidity Migration to Voltaire-Compatible Pools:
• Implement a feature that allows users to seamlessly migrate their existing liquidity to Voltaire-compatible liquidity pools within the platform.
• b) Voting Power Delegation:
• Enable users to delegate their locked ADA as voting power to a selected DRep (Delegated Representative) directly through the Lenfi UI.
• c) Viewing Voting Power Delegation on Explorer:
• Integrate functionality that allows users to view their voting power delegation status on the Cardano blockchain explorer from within the platform.

B: Acceptance Criteria

• Functional Mainnet Client:
• The new Lenfi UI is live on the Cardano mainnet and accessible to all users.
• All three features (liquidity migration, voting power delegation, and viewing delegation status) are fully operational and user-friendly.
• Liquidity Migration Success:
• Users can successfully migrate their liquidity to Voltaire-compatible pools without any errors.
• The migration process is smooth, with clear instructions and confirmations at each step.
• Voting Power Delegation Functionality:
• Users are able to delegate their locked ADA to a selected DRep through the platform.
• Delegation transactions are successfully recorded on the Cardano blockchain and reflected in the user's account.
• Viewing Delegation on Explorer:
• Users can access their voting power delegation details on the blockchain explorer via direct links or integrated views.
• The information displayed is accurate and updates promptly following any changes.

C: Evidence of Milestone Completion

• Access to Live Platform:
• Provide the URL to the live Lenfi UI mainnet client where users can access and utilize the new features.
• Transaction Records:
• Supply transaction IDs or hashes of sample liquidity migration and voting power delegation transactions.
• These transactions can be independently verified on the Cardano blockchain explorer.
• User Documentation:
• Share links to updated user guides, tutorials, or FAQs that explain how to use the new features, including liquidity migration and voting power delegation.
• Screenshots and Demonstrations:
• Include screenshots or video demonstrations showcasing the new features in action:
• The liquidity migration process.
• Delegating voting power to a DRep.
• Viewing delegation status on the explorer.

• Milestone Output: 
• Detailed project close-out report and explanatory video
• Acceptance Criteria:
• All critical and high-priority issues addressed
• Comprehensive close-out report and video explaining the Open Batching solution
• Evidence:
• Published audit report
• Updated codebase reflecting security enhancements
• Published close-out report on Lenfi GitHub repository
• Video uploaded to Lenfi official channels

[RESOURCES] Who is in the project team and what are their roles?

Mantas Andriuska is the co-founder and Aiken smart contract developers on the team. He has appeared in several YouTube and Twitter Space interviews regarding the launch and development of the Aada Finance V1 - the first peer-to-peer lending protocol on Cardano.

Lukas Armonas is a Digital Marketing expert and Project Manager of Lenfi/Aada Finance. He has appeared in several interviews and is responsible for the documentation, educational, and marketing part of the project.

Ovidijus Dargis is the Operations Manager responsible for creating and implementing business growth strategies to promote the project. He oversees various business activities like partnerships and public relations. 

[BUDGET & COSTS] Please provide a cost breakdown of the proposed work and resources

Developer: 680 hours

Average hourly rate: 362.4 ADA

Design and UX: 240 hours

Average hourly rate: 210.2 ADA

Communications and PR: 180 hours

Average hourly rate: 160.2 ADA

Project management: 280 hours

Average hourly rate: 160.2 ADA

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

Project will allow for number 5 by TVL application - Lenfi to merge into Cardano decentralised governance of Voltaire era. Additionally it will be good example and for other projects.