Aiken Smart Contracts for Pooled Lending Protocol on Cardano I Big Blymp

[GENERAL] Name and surname of main applicant

Brandon Chukwuka

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

Entity (Not Incorporated)

[GENERAL] Requested funds in ada

150000

[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 develop Aiken smart contracts for a decentralized pooled lending protocol on Cardano, optimizing liquidity for stable assets and enhancing DeFi capabilities on the platform.

[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

The Aiken smart contracts for the pooled lending protocol and all associated outputs will be fully open-source. The smart contracts, and related documentation will be available on GitHub to encourage transparency and collaboration within the Cardano ecosystem.

[METADATA] Horizons

Lending

[SOLUTION] Please describe your proposed solution

In the current state of Cardano’s DeFi ecosystem, the ability to efficiently manage and utilize stable asset liquidity is underdeveloped. Stablecoins are crucial in DeFi because they allow users to engage in lending, borrowing, and trading without exposure to the volatility of other crypto assets. However, the absence of a well-structured pooled lending protocol results in liquidity fragmentation and limits the earning potential for liquidity providers. Without an optimized, automated way to allocate liquidity and match borrowers with lenders, Cardano users are missing out on opportunities to generate yield from stable asset holdings in a low-risk environment.

This gap not only impedes users from capitalizing on their stable assets but also weakens the overall liquidity in Cardano's ecosystem, which is crucial for healthy market-making, price stability, and economic growth within DeFi. By addressing this inefficiency, we enable users to better deploy their assets while strengthening the foundation for stable and reliable liquidity provision on Cardano.

The pooled lending model is an efficient solution to liquidity management, especially for stablecoins, because it consolidates liquidity into shared pools, which can be accessed by borrowers and lenders at any time. This allows for continuous liquidity, reducing slippage and enhancing capital efficiency. Additionally, pooled lending protocols enable interest rate optimization through the dynamic supply and demand of liquidity, offering higher returns for depositors and minimizing costs for borrowers.

By utilizing Aiken smart contracts, we can leverage the blockchain’s low fees and scalability. Aiken’s simplicity and efficiency in smart contract development provide us with the flexibility to create a robust, secure, and transparent protocol.

Our project will engage two primary user groups:

Liquidity Providers (LPs): These are stablecoin holders looking for a low-risk, yield-generating opportunity. By depositing their assets into our liquidity pools, LPs can earn consistent interest from borrowers who tap into the pool for their lending needs. 

Borrowers: These users require access to stablecoins for various DeFi activities such as arbitrage, trading, or leveraging other DeFi protocols. Our pooled lending protocol will provide them with easy access to stablecoins at market-optimized rates, backed by a liquid pool of assets.

We will track key performance indicators to demonstrate our long term impact on Cardano's DeFi ecosystem:

Total Value Locked (TVL): This will measure the amount of liquidity contributed to the pools, reflecting user confidence and protocol adoption.

Borrower Activity: The number of loans taken and the volume of assets borrowed will serve as indicators of the protocol’s utility to DeFi participants.

Yield Generation: We will track the average yield generated for liquidity providers to demonstrate the protocol’s efficiency in providing competitive, low-risk returns.

The impact of this proposal will be given by the possibility to deliver a back-end smart contract written in Aiken to show the feasibility of implementing these contracts in Cardano. All project outputs, including the Aiken smart contracts, technical documentation, will be published on a public GitHub repository. Updates will also be shared through the Big Blymp website, Twitter, and community channels such as Discord to ensure transparency and engagement with the broader Cardano community.

https://www.youtube.com/watch?v=DMXC2QLIwqY

Why is this important to Cardano?

Cardano is building a robust DeFi ecosystem, and a healthy, liquid market for stable assets is a foundational piece. Our protocol will:

Enhance Liquidity: Increased liquidity in stablecoins supports the overall stability of Cardano’s DeFi infrastructure, making it easier for users to move assets, trade, and borrow.

Attract Institutional and Retail Investors: A stable, low-risk yield-generating product will attract more capital to Cardano, driving growth and adoption from a broader audience.

Foster Ecosystem Growth: By providing a secure, decentralized solution for pooled lending, we create opportunities for other DeFi applications to integrate and build on top of our protocol, further expanding the utility of Cardano.

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

The Aiken smart contracts for a pooled lending protocol on Cardano will have a transformative effect on the Cardano DeFi landscape. By introducing an efficient, decentralized platform for stable asset management, the protocol will:

Boost Liquidity for Stablecoins: Currently, there are limited options on Cardano for users to deploy stablecoins effectively. Our protocol will provide an avenue where stablecoins can be continuously circulated, supporting borrowing, lending, and trading activities, which will increase liquidity across the network. A more liquid environment leads to tighter spreads, lower slippage, and better price stability for users interacting with dApps.

Example: Suppose a trader wants to hedge against volatility by moving assets into a stablecoin like Djed. With our protocol, this user will be able to lock their stablecoins into a liquidity pool, earning a yield while still having the option to borrow or lend against them. This will make Cardano more attractive to both traders and DeFi participants seeking to manage risk with stablecoins.

Increase Total Value Locked (TVL): The introduction of our pooled lending protocol will significantly increase TVL on Cardano by attracting liquidity providers who want to earn yield on stable assets. A higher TVL reflects greater user trust and confidence in the protocol, as well as in the underlying blockchain ecosystem. This, in turn, creates a feedback loop that attracts more capital and further develops the ecosystem.

Example: In Ethereum-based protocols like Curve Finance, high TVL has contributed to the protocol's dominance within the DeFi space. By offering similar opportunities on Cardano, we anticipate the protocol will quickly attract stablecoin holders looking for a low-risk, yield-bearing opportunity.

Lower Risk, Higher Efficiency: One of the key advantages of this protocol is its focus on stable asset liquidity. By concentrating liquidity in pools for stablecoins, the risk for liquidity providers is significantly lower compared to volatile assets. This lower risk will make the protocol accessible to a broader audience, including institutional investors and retail users who prioritize security and capital preservation.

Example: A user looking for stable, predictable returns will find our pooled lending protocol appealing, as it provides a safer alternative compared to more volatile DeFi strategies involving less stable cryptocurrencies.

To measure the long term success and impact of the protocol on the wider Cardano community, we will track several key performance indicators (KPIs):

Total Value Locked (TVL): TVL is a critical metric for assessing the overall health and adoption of DeFi protocols. It represents the total amount of assets held in the protocol’s liquidity pools. A growing TVL will indicate that more users are confident in the protocol and willing to allocate their capital. We will set milestones for TVL growth, such as achieving ₳10M in TVL within the first 6 months of deployment.

Number of Active Users: We will measure the number of unique liquidity providers and borrowers using the protocol. Tracking user growth will help us understand how well the protocol is resonating with the community and identify potential areas for improvement.

Stablecoin Utilization: The volume of stablecoins being deposited, borrowed, and traded through the protocol will serve as a key indicator of how well it is supporting stable asset liquidity. This metric will allow us to gauge the efficiency and attractiveness of the platform for stable asset holders.

Yield Generated for Liquidity Providers: Monitoring the average yield earned by liquidity providers will showcase the protocol’s ability to deliver competitive returns.

Sharing Outputs and Opportunities:

Transparency is central to our approach. We intend to share all technical outputs and results with the wider Cardano community through multiple channels:

Public GitHub Repository: The Aiken smart contracts, technical documentation, and audit reports will be open-sourced and available for anyone to access, review, and contribute to. This fosters collaboration and ensures that other developers can build on or audit the work, enhancing trust in the protocol.

Big Blymp Website and Social Media: Regular updates on the progress of the project, including major milestones and performance metrics, will be shared through the Big Blymp website, Twitter, and other social media platforms. This will keep the community informed and engaged throughout the project lifecycle.

Educational Content and Webinars: To help onboard new users and provide insights into the protocol, create educational content focused on stablecoin management and pooled lending. This will help users of all experience levels make the most of the protocol and deepen their understanding of DeFi on Cardano.

[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?

Big Blymp is a seasoned team of blockchain professionals, having successfully developed and deployed Yamfore, a decentralized finance protocol on Cardano, which has been audited and is live on mainnet. After over a year and a half of private development, this is the first time the team is requesting funds from Project Catalyst, showcasing their commitment to building long-term, sustainable solutions before seeking external support.

The team is led by Brandon Chukwuka, the founder of Yamfore, whose leadership and vision have been instrumental in delivering one of Cardano's most secure and well-reviewed DeFi applications.  Our Smart contracts developer is Dominic Wallis (Waalge) Math PhD. Formerly ML engineer and full-stack dev. DApp developer since Alonzo HF. Aiken contributor. 

The entire team is composed of exceptional professionals with a proven track record in the space. Diego Macchi, a respected community advisor, rounds out the team with his deep understanding of DeFi and the Cardano ecosystem. Linda, a Cardano OG, MALU Stake Pool Operator, is a community expert specializing in DeFi, content creation, and engagement strategies. She has been a driving force behind the success of several Cardano initiatives and brings invaluable experience in content creation and she will contribute to the project as an external member.

This combination of technical proficiency and community leadership makes Big Blymp uniquely positioned to deliver this project with high levels of trust and accountability.

Big Blymp has demonstrated its ability to create secure, scalable, and efficient DeFi applications on Cardano, evidenced by Yamfore's successful deployment. The team is proficient in Aiken smart contract development and the UTXO model, ensuring that their solutions leverage Cardano's unique architecture for maximum performance and security. With a focus on stable asset liquidity and yield optimization, the team's expertise will be key in delivering the pooled lending protocol.

The team’s experience in developing DeFi protocols includes deep knowledge of:

• Aiken development framework for efficient and secure smart contracts.
• Decentralized liquidity management to optimize returns and minimize risk.

Big Blymp is fully committed to maintaining transparency and accountability throughout the development process.

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

Smart Contract Design  (Month 1-2)

• Objective: Initial architecture design for the pooled lending smart contracts.
• Deliverables: Initial architecture document and flow diagrams explaining the smart contract structure and logic.
• Acceptance Criteria: Initial smart contract design, with a technical document.

Smart Contract Development (Month 3-4)

• Objective: Develop the Aiken smart contracts based on the initial architecture.
• Deliverables: Fully coded Aiken smart contracts for core functionalities, including lending, borrowing, and liquidity optimization.
• Acceptance Criteria: Aiken smart contracts for pooled lending video posted on Youtube and X.

Educative videos and Communications Campaign (Month 4)

• Objective: Educational video about Pooled Lending.
• Deliverables: Creation of educational video and outreach efforts to introduce the protocol to the broader Cardano and DeFi community.
• Acceptance Criteria: Educational video posted on Youtube and X.

Project Close-Out Report and Video (End of Month 6)

• Objective: Publish a final report summarizing the smart contract development and marketing efforts.
• Deliverables: Comprehensive close-out report and a project video summarizing the impact and next steps.
• Acceptance Criteria: Public release of the report and video on Big Blymp’s website, and through Cardano community channels.

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

Brandon Chukwuka

Role: Lead Project Manager - Big Blymp Founder

Responsibilities: Overseeing the project, managing timelines, coordinating development, and ensuring milestones are met.

X: zartsnarf

Diego Macchi

Diego Macchi is a graduate from the Economic University of Buenos Aires. Cardano OG and member of de DeFi community.

Role: Community Advisor

Responsibilities: Community advisor and partnerships lead.

X: diegomac35

Dominic Wallis (Waalge)

Waalge is Math PhD. Formerly ML engineer and full-stack dev. DApp developer since Alonzo HF. Aiken contributor, particularly the nix maintenance and fuzz lib. 

Role: Smart Contract Developer

Responsibilities: Developing the core Aiken smart contracts and ensuring the protocol’s security and functionality.

Developing the user interface for interacting with the lending pools, managing deposits, and yield visualization.

X: Waalge

GitHub: https://github.com/waalge

Jimmy

Role: Front End Developer

Responsibilities: Developing the front end smart contracts

https://0xjimmy.xyz/

X: 0xjimmy_eth

GitHub: https://github.com/0xjimmy

Gritar

Role: Graphic Designer

Responsibilities: design the user interface for interacting with the lending pools, managing deposits, and yield visualization.

X: gritar

Linda - MALU Pool 

Role: Marketing and communications

Responsibilities: Video content creation and educational resources.

X: Cryptofly777

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

Smart Contract Design 

Initial architecture design for Aiken smart contracts.

2 Aiken Developers 12,500 ADA/month for 2 months = 50,000 ADA

Tasks: Smart contract design, architecture documentation, flow diagrams.

Smart Contract Development 

Develop Aiken smart contracts

2 Developers  12,500 ADA/month for 2 months = 50,000 ADA

Tasks: Coding, debugging, testing, and ensuring compatibility with the Cardano network.

Testnet operations, deployment tools, and security checks = 10,000 ADA

Needed for contract testing, deployment environments, and testing token utilities.

Educative Videos & Communications Campaign 

Content Creation (Video Production):

Video production, editing, script writing = 12,000 ADA

Video script creation, editing, and animation for educational content on Pooled lending Smart Contracts..

Project Manager:

1 Project Manager  4,000 ADA / month for 6 months = 24,000 ADA

Tasks: Overseeing development, ensuring milestones are met, managing timelines and team.

Miscellaneous 4,000

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

The 150,000 ADA budget we are requesting represents a strategic investment in the Cardano ecosystem, providing high value for several reasons:

The cost of developing smart contracts, particularly on Cardano using Aiken, is competitive with industry standards and well-aligned with global market rates for decentralized finance (DeFi) projects.

By building with Aiken, we are ensuring the latest efficiency and scalability standards, meaning fewer development iterations and smoother future protocol integration. This reduces the need for extensive post-development auditing or rework, making the budget more efficient in the long term.

All of our smart contracts, educational content, and technical documentation will be open-source. This means, other projects can leverage our work without duplicating effort, reducing development costs for future initiatives.