🏁 MLabs + Cardano Racers: Hydra Auctions & User Experience Drive 🚥🏎️

[GENERAL] Name and surname of main applicant

MLabs Ltd.

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

Entity (Incorporated)

[GENERAL] Requested funds in ada

499692

[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)

The Cardano Racers Web3 GameFi DApp will increase engagement by providing financial incentives for user participation in this racing-themed NFT game. The game is already on mainnet and is growing.

[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

As a token of gratitude to the Cardano community, if the project is funded by Catalyst the on-chain scripts (a.k.a. smart contracts) will be fully open sourced. This will bring inspiration and an starting point to developers seeking to build similar applications. The license used will be either MIT License or Apache 2.0 License.

All off-chain code will be closed source.

[METADATA] Horizons

Gaming

[SOLUTION] Please describe your proposed solution

THE GAME

Cardano Racers mission is to create an economically sustainable Cardano dApp that encourages active user participation on the Cardano blockchain. The project was created to incentivize ADA holders to make transactions with their ADA and participate in the ecosystem, rather than just to simply hold and stake their ADA.

Cardano Racers was designed to help increase the number of transactions, wallets, native tokens and smart contracts created on the Cardano blockchain. The dApp utilizes Plutus smart contracts and Cardano native tokens as a means for facilitating new wallet creation, active daily users and increased transaction volume on the Cardano blockchain.

The game is already live on mainnet and can be played at https://www.cardanoracers.com/

In order to participate in the game, players must first purchase two NFTs, one representing a race car and the other representing a driver. Each NFT has four attributes on a scale of 1 to 10,000. For the race car the attributes are acceleration, cornering, aerodynamics and maximum speed. For the driver, the attributes are experience, aggressiveness, reflexes and luck. When buying an NFT, a random combination of stats is assigned to the NFT during the minting process.

When entering a race, users pay an entry fee and select a combination of car and driver among their collection and register them on-chain to participate in the race. This selection can be informed by the configuration of the racetrack where the race will take place or the expected atmospheric conditions.

Upon successful registration, the player is ready to pariticipate in the race and play the game. The current format of the game is a combination of a simulation and a videogame consisting of a single lap to the racetrack.

Both the lap time from the simulation and the videogame are combined and prizes are distributed to players with the fastest lap times.

NEXT STEPS

The near-term objectives for Cardano Racers are to smooth out the user experience based on feedback from early players, grow the user base and explore new exciting features.

User experience improvement

Being Cardano Racers an NFT-based game, it attracts users with a significant amount of NFTs in their wallets. This has a negative impact on the user experience when submitting transactions to register in races, as transactions often fail and need to be resubmitted after rearranging the assets in the user’s wallet.

The technical explanation for this is that the on-chain logic enforcing correct registration requires looking for the race car and driver NFTs in the UTxOs provided by the user as inputs to the transaction, but this UTxOs are bloated with different assets, increasing the memory units and CPU steps needed to find the NFTs. Being the maximum memory units and CPU steps capped at 14,000,000 and 10,000,000,000 respectively, when the memory or CPU use exceeds those limits the transaction fails.

The current mitigation for this issue is to redirect users to a third party like DripDropz’s unfrack.it, which helps users to rearrange the assets in their wallets. However, this is an inconvenient procedure that has been identified as the main contributor to the newcomer bounce rate, limiting the growth potential of the game.

The plan to tackle this problem is twofold. Firstly, the current PlutusTx on-chain scripts will be written in a more efficient language like Plutarch or Aiken. This will result in the base transactions consuming less memory and CPU, being further from hitting the limits and therefore increasing the number of scenarios and asset distributions that are correctly handled. Secondly, for the extreme cases which still run into trouble, a built-in service to rearrange the assets will be developed, so that users can seamlessly register without having to leave the site.

  

Experimental feature - Hydra use case

Hydra is a layer 2 scaling solution for Cardano that takes computation off-chain via isomorphic state channels before settling to the Cardano layer 1, reducing latency and fees while increasing throughput (https://hydra.family/head-protocol/).

Recently, a demonstration of its capabilities was performed by running a subset of the Doom engine on it. By sumbitting one transacation per frame at a rate of 35 frame per seconds on Hydra heads supporting 5 game sessions, a single Hydra head was able to handle 175 transactions per second. This number scales linearly with the number of Hydra heads spun up:

https://www.youtube.com/watch?v=CGsy9sp3s4w

As part of the commitment of Cardano Racers with increasing the use of the technology developed around Cardano, the game is looking to leverage Hydra in different ways. This has the potential to power a multi-player experience where thousands of players are interacting with the game in real time.

As a first step, the game will add support for NFT auctions that can leverage Hydra to increase the throughput of bids. This will allow players to bid for limited edition or rare cars and drivers without technical constraints imposed by the relatively lower throughput of the Cardano L1, making the auction as fair as it can be.

The intention is to build on top of the existing work to make auctions possible on Hydra, adapting it to the needs of Cardano Racers:

• https://github.com/mlabs-haskell/hydra-auction
• https://github.com/mlabs-haskell/hydra-auction-offchain

By integrating the Hydra auctions into Cardano Racers, the game will become one of the first projects leveraging L2 technology on Cardano, providing a real use case to Hydra and serving as a testing bed of the use of the technology in the wild.

The successful integration of the Hydra auctions into Cardano Racers will pave the way for further innovation around Hydra, opening up the possibility to add new features to enhance the in-game experience.

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

The Cardano Racers Web3 GameFi DApp is poised to significantly enhance the Cardano ecosystem by increasing user engagement and transaction volume. The introduction of an NFT-based racing game, built on the Cardano blockchain, offers a unique blend of entertainment and financial incentives, thus attracting a broader audience to the platform.

The impact will be measured both quantitatively and qualitatively. Quantitatively, we will track metrics such as the daily active users, new wallet creations, and transaction volumes. Additionally, we will gather qualitative feedback from the community on user experience and engagement via surveys and forums.

We are committed to maintaining transparency and fostering community engagement throughout the project. Regular updates and progress reports will be shared through Cardano community forums and social media platforms. Moreover, we plan to host interactive sessions with the community to gather feedback and discuss future enhancements, ensuring our project continually aligns with the needs and aspirations of the Cardano community.

Our team is confident in the project's potential to influence the Cardano ecosystem positively. The blend of innovative gaming experience with blockchain technology not only promises to enhance user engagement but also sets a precedent for future applications within the blockchain space. We are committed to delivering tangible, measurable results and maintaining an open, ongoing dialogue with the community.

[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?

Our team's capability to deliver all the improvements to Cardano Racers with exceptional trust and accountability is rooted in our comprehensive experience and the synergistic collaboration among our team members. We have a diverse group of professionals, including blockchain developers, front and backend developers, UI/UX designers, and project managers, each bringing specialized skills and a commitment to teamwork.

The feasibility of our approach is not just theoretical but proven in practice. Our blockchain developers actively support the front and backend teams, ensuring seamless integration and alignment of the DApp's various components. This collaborative process has already led to a successful mainnet launch and an application that has been up and running for over 6 months and has undergone an upgrade to the new Cardano Conway era.

Communication is key in our project management strategy. We currently maintain a rigorous schedule with bi-weekly (twice-a-week) calls and daily updates, fostering a transparent and cohesive work environment. This ensures all team members are synchronized, challenges are promptly addressed, and the project's progress is continuously monitored.

Our project's timeline and milestones are grounded in the tangible success of our initial mainnet launch. This has provided us with valuable insights and data, allowing us to set realistic and achievable goals. We have also identified potential risks and developed comprehensive mitigation strategies to ensure project continuity and success.

In summary, our team's blend of expertise, collaborative spirit, structured communication, and practical insights from our initial development phase collectively affirm the high feasibility and reliability of the Cardano Racers project. We are committed to not just meeting but exceeding the Cardano community's expectations, ensuring the impactful and timely completion of the project.

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

Milestone name

Built-in defragmentation tool

Outputs

• Updated transaction builder that builds a transaction to rearrange assets in the user’s wallet so that UTxOs can be used to interact with the Cardano Racers game.
• Updated API that builds a defragmentation transaction after failing to correctly interact with the Cardano Racers app. 
• Implementation of the defragmentation tool in the frontend so users can be prompted to sign the defragmentation transaction.

Acceptance criteria

• The application frontend correctly prompts the user to sign and submit a defragmentation transaction after hitting an error when trying to interact with the Cardano Racers scripts and a subsequent transaction repeating the original action is successful.

Evidence of milestone completion

A video demonstration of an interaction with the Cardano Racers application showing that the acceptance criteria is met.

Milestone name

Efficient on-chain scripts

Outputs

• Refactored on-chain scripts written in Plutarch or Aiken that are more performant than the original PlutusTx ones.

Acceptance criteria

• The transactions to interact with Cardano Racers are significantly more performant.

Evidence of milestone completion

A report comparing the resource consumption of transactions interacting with the Cardano Racers application using the original PlutusTx scripts and the Plutarch/Aiken ones.

Milestone name

NFT auctions using Hydra - backend

Outputs

• On-chain scripts that control the logic of the auction.
• Transaction builder to participate in the auctions.
• Infrastructure to move the auctions to the Hydra L2.

Acceptance criteria

• An end-to-end auction can take place using the Cardano Racers backend: listing an NFT for auction, taking bids from participants and closing the auction.

Evidence of milestone completion

A video demonstration will showcase the end-to-end auction interacting with the Cardano Racers backend using the terminal.

Milestone name

NFT auctions using Hydra - frontend

Outputs

• A non-deployed version of the frontend is updated to display NFT auctions and allow bidders to participate using it.

Acceptance criteria

• The frontend displays the NFTs being auctioned.
• The frontend allows bidders to bid on an NFT auction.
• The frontend displays how much time is left to finish the auction.
• The frontend closing of an NFTs auction after the auction time has elapsed.

Evidence of milestone completion

A video demonstration will showcase the end-to-end flow of an NFT auction, focusing on showing how a user could participate in them via a web-app using the information displayed by the frontend.

Milestone name

NFT auctions using Hydra - deployment

Outputs

• A version of the web-app that includes NFT auctions supporting the use of Hydra on mainnet is deployed.

Acceptance Criteria

• The web-app displays the NFTs being auctioned on mainnet.
• The web-app allows bidders to bid on an NFT auction on mainnet.
• The web-app displays how much time is left to finish the auction.
• The web-app allows closing of an NFTs auction after the auction time has elapsed.
• The Hydra L2 is leveraged on the auctions displayed by the web-app.

Evidence of milestone completion

A public announcement will be made to inform of the addition of the auctions feature to the Cardano Racers web-app, and the web-app will be publicly available for anyone to participate in the auctions. A report showcasing the completion of the first few auctions will be shared.

Tech debt and users’ feedback

Outputs

• Document listing known tech debt.
• Document gathering feedback from early users.
• Incremental improvements to the application to address the tech debt and the most relevant feedback from users, resulting in a game properly maintained for the duration of this grant (at least July 2025).

Acceptance criteria

• Customer feedback gathered via consultation on the game’s Discord is properly documented.
• All tech debt and customer feedback is either addressed or an explanation of why is not being addressed is provided.
• Incremental improvements are made to the Cardano Racers application improving the user experience and quality of the game.
• The Cardano Racers application is properly maintained until July 2025. 

Evidence of milestone completion

• Report containing the feedback gathered and the improvements made to Cardano Racers during at least the first 6 months after successful selection of this proposal.

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

Matthew Bollinger – Founder | LinkedIn profile: Matthew Bollinger

Matthew has been an entrepreneur for over a decade. His academic discipline is in engineering, with multiple advanced degrees with focuses in operations and business management. Matthew's investing career began in real estate where he founded two successful real estate investment companies focusing on residential housing in the western Pennsylvania region (USA). Matthew has also founded an engineering consulting firm providing services to the oil and gas industry. Matthew began to gain interest in cryptocurrencies in 2021 and after careful reserach concluded that the Cardano blockchian provided the best opportunity for the future.

Noah D Kail – Administrator

Borned and raised in the Pittsburgh area (Pennsylvania, USA) and a former young wrestler, Noah has worked in the oil and gas industry for the past 8 years. With a strong conviction for the need of decentralized currencies, he is committed to actively help build up the Cardano ecosystem. Noah is responsible for all the art behind Cardano Racers NFTs and is in charge of performing the different administrative tasks.

MLabs - Development Team | Website: https://mlabs.city/

MLabs has quickly become one of the premier development firms in the Cardano Ecosystem. An IOG Plutus Partner working regularly with IOG to develop the Cardano blockchain and ecosystem, MLabs' team is composed of one of the largest groups of Haskell/Plutus developers in the community. MLabs has helped build community projects such as:

• Indigo
• Liqwid
• SundaeSwap
• Minswap
• Optim
• Many others

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

Milestone 1 - Built-in defragmentation tool: ₳59,317

• Blockchain/backend development team: 90 hours
• Frontend and devops teams: 68 hours.

Milestone 2 - Efficient on-chain scripts: ₳102,867

• Blockchain/backend development team: 234 hours
• Devops team: 40 hours

Milestone 3 - NFT auctions using Hydra - backend: ₳124,266

• Blockchain/backend development team: 331 hours

Milestone 4 - NFT auctions using Hydra - frontend: ₳98,362

• Frontend team: 262 hours.

Milestone 5 - NFT auctions using Hydra - deployment: ₳39,795

• Devops team: 106 hours

Final milestone - Tech debt and users’ feedback: ₳75,085

• Team: Blockchain/backend development, frontend and devops: 200 hours

Subtotal:

• 1,331 hours of development @ 110 USD/hour = 146,410 USD

Total: 146,410 USD @ $0.293* USD / ADA = 499,692 ADA

*In the interest of full transparency, please note we have applied a conservative USD/ADA exchange rate in pricing this proposal (6-months low from April 2023 to September 2024). This is to ensure our operations remain stable regardless of market conditions. Although we firmly believe the future of Cardano is bright, we recognize the price of ADA and all cryptocurrencies is inherently volatile. Our financial obligations are denominated in fiat. Most importantly, this includes the salary of the engineers whose hard work makes projects like this possible.

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

Our proposal represents exceptional value for money for the Cardano ecosystem. The funding requested is meticulously calculated and justified, ensuring every ADA spent contributes directly to the project's success and, by extension, to the enrichment of the Cardano community.

The budget is based on competitive rates in our industry, ensuring fair compensation for the team while maintaining cost-effectiveness. A detailed breakdown includes development costs, blockchain integration, user experience design, and community engagement activities. Each of these components is crucial for creating a high-quality, engaging DApp that will attract and retain users on the Cardano platform.

Our team possesses the necessary skills and experience to manage these funds effectively. We have a proven track record in blockchain development and project management, ensuring that the project will be completed on time and within budget.

In conclusion, the investment in Cardano Racers is not only a financial contribution to a single project but a strategic enhancement to the broader Cardano ecosystem. It promises to deliver measurable benefits and a substantial return on investment, both in terms of technological innovation and community engagement.