Cardano Token Engineering Lab - Understanding and leveraging token design to grow Cardano

[GENERAL] Name and surname of main applicant

Miguel Saldana

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

Individual

[GENERAL] Requested funds in ada

20000

[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)

• Create research and case studies of common blockchain protocol's
• Set a foundation of data querying to be used for modeling
• Educate projects and public on best practices about token creation/design

[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

GitHub will be used as the primary repo for any data and/or code developed and will be licensed with an MIT license.

[SOLUTION] Please describe your proposed solution.

The proposed solution for this project can be broken into 3 main parts:

1. Bootstrap a community of token engineers to accomplish the following goals:
2. Build proficiencies and understanding of basic token design patterns across various crypto verticals (ie. Lending Protocols, DEXs, Synthetic Assets, NFTs, Utility, etc...)
3. Create and introduce basic systems modeling in programming languages (ie Python) templates from overly simplified 2 variable problems and developing models of increasing complexity until a standard 2-token constant product AMM, like Uniswap or Minswap
4. Create a common repository of case studies, models, and content around token engineering, modeling, and breakdowns of protocol implementations within the Cardano ecosystem.
5. Develop a common indexing strategy and code for modeling in a systems modeling program such as cadCAD or Machinations
6. Create partnerships across various protocols and projects in Cardano as well as cross-chain partnerships with Token Engineering groups (ie Token Engineering Academy, Bonding Curve Research Group, and Token Gnomes)

This proposal is a bootstrapping task to help build awareness around token engineering and to help the community and projects alike learn from existing strategies and design patterns, to bolster the success rate of projects as they launch and create a token to support their own respective project.

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

With Cardano Native Tokens, being incredibly easy to mint and create and many projects starting tokens, a place to understand and learn about the basis of why tokens are needed is a must. Having access to quality, curated material from the Token Engineering communities (both academic and private) can help to build fluency in the community.

Building a community via social media followers is a way to gauge the ability to attract people and projects.

In addition, there are no easy ways to query and get on-chain data for modeling token dynamics. This will require the development of a basic framework that uses an indexed solution targeted towards token engineering simulations. By creating a framework, future modeling and getting access to the pertinent material to the model will be easier to accomplish.

Working with new and existing projects in the ecosystem to determine economic risks, mechanism design, and other parameters that build on strong demand-side tokenomics, can help provide a firm standing for projects that are looking to bootstrap themselves from a token launch.

At the current stage of many DAOs and DeFi projects, it’s clear that many projects either do little or no token engineering out in the open and publish those outputs. As design mechanisms for any protocol proposal are changed it only comes along with some written text on why it’s being implemented and then pushed to a vote. Blockchain is designed to have transparency within the protocol and this calls for building skills and creating open-source models for people to understand how the changes affect things. This is paramount to ensure that short-sighted decisions are not being made and ultimately have negative long-term effects on any project. An example would be a project that launches a token. They need to be careful about the initial incentive mechanisms to ensure that they don’t make it impossible for newcomers down the road to be overpowered by OGs who just happened to be earlier. Developing egalitarian methods and processes to incentivize, maintain, and grow protocols is critical for projects to grow and be sustainable over a long period.

It’s understood that this proposal may have not been socialized as much as other projects, but the aim is to start to raise awareness, find others with common interests, and ultimately bootstrap this endeavor with Fund11 funds (or future funds). EVM-based chains have very well-put-together projects such as the Token Engineering Academy, Blockscience, and many others that have academic experts working alongside community members to develop resources and research on token engineering topics.

[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?

I am an engineer with over 15+ years working in the energy industry doing engineering planning and operation execution for oil and gas drilling. I have built engineering and cost-estimating financial models to support engineering designs as well as business plans for large-scale operations. In my engineering work, I've built and created automated workflows and scripts of large-scale datasets for KPI (key performance indicators) and metric generation.

I am also a core contributor for tokendynamics.xyz which is a token engineering consulting group that is working actively with various DeFi projects. Working with Token Dynamics has highlighted the lack of tooling and general understanding of design patterns that exist natively in the Cardano ecosystem and I'll be looking to help lay some foundational work with my experience starting with this proposal.

I have also been a core member of the Sarcophagus protocol where I lead growth and business development for the project. Sarcophagus is a decentralized, dead man's switch protocol built on Ethereum and Arweave and has developed a dapp and token on Ethereum. I have developed many relationships across the Ethereum space and have befriended many project founders and notable token engineering personalities that I plan to leverage and build off the knowledge existing in the Ethereum space to create a space in Cardano that does the same.

I have also an MS degree in Computer Science and have proficiencies in programming Python and SQL.

I have also gone through various self-learning programs about token engineering and modeling from the Token Engineering Academy, cadCAD.Education, in addition to working and contributing to places like Token Dynamics. This combined with my formal education and work experience helped me to be able to deliver the requirements of this proposal.

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

Formalize an easy-to-go-through data repository:

Milestones:

• Finalize the method to store project data and research (GitHub, Notion, Discord, etc..)
• Provide case studies regarding token design on 3-5 of the top-used DeFi projects in the Cardano space

Acceptance Criteria:

• There is a repo with project material and research located publically available
• the minimum requirement of case studies are completed in the time frame

Develop a framework for Modeling Data Curation:

Milestones:

• Provide basic code/query on GitHub to acquire the necessary on-chain data to perform systems modeling for various blockchain protocol designs

Acceptance Criteria:

• Code available on GitHub publicly of the basic script to connect to a node and pull required data for modeling inputs
• Develop/understand/leverage labeling scheme of various protocol smart contracts to make understanding project data easier and more accessible

Formulate Partnerships with Protocols and Token Engineering Groups:

Milestones:

• Establish and define a working relationship with active Cardano protocols
• Create a partnership with token engineering groups that exists on other chains with notable figures in the token engineering space

Acceptance Criteria:

• Define a working agreement with at least one Cardano DeFi protocol to assist with mechanism design and protocol economic security analysis
• Create a partnership with at least one token engineering group across other chains to leverage knowledge sharing and encourage Cardano community members to join.

Deliverable of all milestones:

1. Research, data, and curation of data in a stored repository
2. Case Study on a minimum of 3 Cardano DeFi projects
3. Develop a coding framework for data modeling curation
4. Form agreed partnerships across protocols and token engineering groups

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

Miguel Saldana - Lead of Cardano Token Engineering Lab proposal

Associated Projects or Social Media Contacts:

LinkedIn Profile: https://www.linkedin.com/in/msaldana1000/

Personal Twitter/X: https://twitter.com/USCMigs

Cardano Token Engineering Twitter/X: https://twitter.com/CardanoTokenLab

Token Dynamics: https://tokendynamics.xyz

Sarcophagus: https://sarcophagus.io

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

Project planned expenditures (denominated in USD)

$7550 USD - Project Proposal Request (20,000 ADA @ $0.37 on 11/29)

$1,000 - Administrative Costs:

$400 - Web Domain/hosting (one year cost)

$100 - Notion Plus (one year cost for plus tier)

$500 - Machinations.io membership for developing modeling simulations and diagrams

$1,200 - Curation and creation of articles and research on Token Engineering (~2-3 hrs/week):

$1,200 - Weekly articles over 6 months on topics pertaining to various aspects of token engineering, mechanism design, and various crypto verticals token pattern designs

$3,000 - Case Studies (3 case studies min & ~75hrs of work over 6 months):

$1,000 - Cost per case study and documentation to release case studies (~25 hrs dedicated per case study)

$2,350 - Code Framework for Modeling Data Acquisition (~45-50 hrs of work over 6 months):

$2,000 - Formalize an indexing-based solution from existing solutions in the Cardano Ecosystem

$350 - Provide documentation, codebase, and examples of how to use solutions such as cadCAD or Machinations.

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

This project provides the first open source and targeted token design public good in the Cardano ecosystem. Other ecosystems have dedicated Commons and research groups that are building, researching, and developing skillsets to provide to projects around mechanism design, token creation, and economic risks around tokens. This is the initial framework to bootstrap this effort and to build more fluency in the Cardano ecosystem.

This proposal is asking for just above the bare minimum requirements for funding as this is the initial bootstrap for this effort and the goal is to ensure that fund11 funding is not excessively requested as a protection to both Cardano and Catalyst and to ensure that other smaller projects can get funding as well. The goal is to build together and the required funding should be more than adequate to cover administrative and time costs for my efforts.

[IMPORTANT NOTE] The Applicant agrees to Fund 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