Last updated 3 weeks ago
Current DeFi protocols lack composability and rely on a variety of centralized actors (i.e. oracles, batchers). Such resilience/availability risks are unsuitable for an alternative financial system.
This is the total amount allocated to P2P-DeFi Protocols: Continued Development. 0 out of 5 milestones are completed.
1/5
Cardano Loans V2
Cost: ₳ 46,200
Delivery: Month 1 - Apr 2024
2/5
Cardano-Options V2
Cost: ₳ 46,200
Delivery: Month 2 - May 2024
3/5
Cardano-Aftermarket V2
Cost: ₳ 30,800
Delivery: Month 3 - Jun 2024
4/5
Desktop GUI
Cost: ₳ 7,700
Delivery: Month 5 - Aug 2024
5/5
P2P-DeFi Manifesto + Videos
Cost: ₳ 23,100
Delivery: Month 6 - Sep 2024
NB: Monthly reporting was deprecated from January 2024 and replaced fully by the Milestones Program framework. Learn more here
fallen-icarus (Twitter, Github)
Note: we are a small, two-person team that prefers to maintain public pseudonymity. Our pseudonyms are consistent across all platforms, and we are more than happy to verify our identities with the Catalyst administrators on a need-to-know basis.
A family of radically permissionless and composable p2p-DeFi protocols that forgo reliance on permissioned off-chain software, in favor of p2p-driven liquidity and price discovery.
Aiken - The core of this project is a collection of on-chain validator & minting policies written in Aiken. Although all four protocols are currently working MVPs, we will not consider them ready for mainnet deployment until Aiken reaches a stable level of development. Nonetheless, the current state of Aiken is plenty enough for us to continue development.
All aspects of the project (on-chain & off-chain code, documentation, e.t.c.) is open source, under the Apache 2.0 license.
The P2P-DeFi Protocols project seeks to establish the basic building blocks of p2p finance on Cardano. it is a family of synergistically composable DeFi protocols with high security and availability guarantees. Currently, it is composed of four core protocols:
All four of these are already working prototypes. For more details on each protocol, please visit the respective Github repos linked above.
Here are some high-impact features shared by all four protocols:
For a full list of features shared by all p2p-DeFi protocols, please refer to the broad overview document here. The scope of this proposal is to continue the development, documentation and peripheral support of the four protocols.
Decentralized Finance (DeFi) has long sought to provide an alternative financial platform for the disenfranchised or underbanked peoples of the world. Although DeFi has come a long way, it still suffers from issues that mostly stem from the same critical tradeoff: enshrined actors.
Availability/Resilience
An alternative financial system will likely be perceived as a threat by those in positions of high (legacy) power, who may employ a variety of regulatory or cyber-offensive tactics to disrupt it. To resist such disruptions, DeFi protocols must strive to maintain rigorous byzantine fault tolerance (security and availability guarantees), ideally as much as the underlying blockchain. Although many DeFi protocols offer reasonable security guarantees, the same cannot be said for availability:
This project solves the availability concern by forgoing reliance on off-chain information in favor of endogenous price discovery and NFT-mediated indexing.
Custody and Composability
Efficient use of (limited) transaction space is critical to scaling decentralized protocols. A key idea here is that simple pieces of logic can be composed with one another, resulting in complex and expressive protocols. The trick is in designing these simple pieces holistically, such that they do in fact compose well with each other. Unfortunately, this is not so easy in practice, and is largely a consequence of enshrined actors.
Since most DeFi applications are designed by separate teams and usually rely on separate aggregators/batchers/LPs, the resulting protocols are not easily composable. There may be some instances where composition is achievable through hacky/low-level transaction building, but this is far from an optimal solution. Additionally, enshrined actors must be incentivized, and are mostly done so through extra fees. These "protocol" fees are usually about an order of magnitude higher than the underlying transaction fee, which is less than ideal.
This project achieves composability by taking a holistic approach to eUTxO-based DeFi. The requirements of an entire financial stack are considered, and are balanced with the constraints of a fully p2p architecture.
Capability
Despite previously not receiving funding, we've largely adhered to the roadmap set forth in our Fund10 proposal. Since then, we've gotten up to about the first milestone (Cardano-Swaps refinement). The plan is to continue moving forward along this direction. We've received significant positive feedback from the community regarding our progress so far; a testament to our ability to deliver.
Feasibility
Each of the four protocols are already working prototypes, and have demonstrated technical feasibility, as well as community interest. Some protocols are further along the development pipeline than others (Cardano-Swaps is the furthest along, thus far).
All four protocols will continue to be refined/optimized, the specifics of which are discussed in the milestone section, below. The chief focus of our R&D efforts is:
Feasibility is also validated through rigorous benchmarking of deposit and transaction fees, CPU/memory utilization, and number of Beacon queries. Here is an example of benchmarking for Cardano-Swaps.
Documentation & Support
Architectural decision-making and protocols' logic will be thoroughly documented to foster collaboration with a wider community of developers. Written and video tutorials will be created to help establish a user base. The feasibility of our approach will be validated by feedback from users and developers.
Cardano-Swaps (~3 weeks)
As the first milestone on our Fund10 roadmap, this phase is furthest along in development and has already reached beta. See the changelog here. In addition to the original roadmap items, we've added a "two-way" swap feature that enables market makers to provide bidirectional liquidity.
The next few weeks will be spent further optimizing/refining throughput, and associated benchmarking. This phase will likely be completed prior to the start of Fund11 voting.
Cardano-Loans (~10 weeks)
Cardano-Options (~8 weeks)
Cardano-Aftermarket (~6 weeks)
Unified CLI Program (~1 week)
A terminal-based interface will be developed to interact with the four protocols, and will serve as the minimum viable UI for early adopters. It will support using each protocol individually, composing transactions with multiple protocols, and querying beacon tokens via a pluggable API.
Currently, we are a two-man team based in the US:
fallen-icarus: Protocol Architect and Lead Developer
After over two years' experience with PlutusTx and Aiken, fallen-icarus has developed a deep understanding of Cardano's eUTxO model. As a pioneer of the Beacon Token design pattern, he has a proven ability to think outside the box and develop novel asset-oriented programming techniques.
zhekson: Technical Writer and Community Advisor
A longtime member of the community, zhekson has demonstrated his commitment and technical expertise in Cardano. He is passionate about distilling high-impact technical concepts for the masses, and doing so in an easily digestible manner. He actively engages with the community on Twitter, is a top contributor to the Cardano Stack Exchange, and operates a productive stake pool.
Total Budget: $61,600 / 154,000 ADA (@ $0.40 per ADA) / 7 months
Note: 9 months includes 2 months between proposal submission and voting results, plus 7 months after voting results. The team will treat the two month interim as if they are funded, proceeding with and sharing their work accordingly.
Breakdown:
Full-time Protocol Architect & Developer: $45/hr x 1120 hours = $50,400
Part-Time Technical Writer & Admin - $20/hr x 560 hours = $11,200
We see a clear path towards truly resilient, sustainable, and equitable peer-to-peer finance. For the first time ever, humans will have the tools to forge an uncensorable, endogenous economy on the Cardano blockchain. One that is decoupled from the whims of the legacy financial system, and is secure, available, and 100% permissionless.
The team is based in the US, and has priced their time accordingly. This proposal offers excellent value for money, in our humble opinion.