Developing a Compliant Stablecoin Platform on Cardano by TokenLink

[GENERAL] Name and surname of main applicant

Zug Software Solutions

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

Entity (Incorporated)

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

4

[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 a Proof-of-Concept platform on Cardano that enables users to mint and burn stable coins, advancing regulated DeFi solutions on Cardano

[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?

No

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

We will not open-source the platform as its a first step towards our RWA/StableCoin Platform running on Cardano.

[METADATA] Horizons

Stablecoin

[SOLUTION] Please describe your proposed solution

We propose to develop a Proof of Concept (POC) platfrom that allows users to mint and burn a stablecoin on the Cardano blockchain and later adjust this platform to allow for MiCa-compliance. This POC will serve as a foundational step towards a fully functional regulated stablecoin ecosystem on Cardano, demonstrating the practical application of MiCA compliance within the Cardano DeFi space.

Our approach involves:

• Smart Contract Developmen/Minting toolt: Designing and implementing secure minting tool (potentially through a smart contract) for minting and burning a PoC stablecoin,
• Backend Infrastructure: Developing backend services that facilitate communication between the user interface and the Cardano blockchain, handling transaction processing and data management.
• User Interface (UI): Creating a user-friendly interface that allows users to interact with the system seamlessly, including features for minting, burning, and viewing transaction history. This also includes demo stable-coin off/on-ramp functionalities.

By delivering a working POC, we aim to showcase the feasibility of a first step towards a MiCa-compliant stablecoin on Cardano, inspire confidence in compliant DeFi solutions.

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

Our project will have a significant positive impact by providing a practical demonstration towards a MiCA-compliant EUR stablecoin on Cardano. This POC will:

• Accelerate DeFi Innovation: Enable developers and users to build upon and interact with compliant stablecoin solutions leading to more innovation.
• Attract Institutional Interest: Showcase Cardano's capability to support regulated financial products, attracting institutional players.
• Enhance User Trust: Provide a secure and compliant platform for users, increasing trust in Cardano's DeFi ecosystem.
• Expand Use Cases: Open up new possibilities for DeFi applications that require a stable, compliant EUR-pegged asset.

[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 possesses strong expertise in Cardano blockchain development and compliance with regulatory frameworks like MiCA. Key capabilities include:

• Experienced Developers: Our blockchain and backend developers have a proven track record of delivering successful Cardano projects.
• Compliance Expertise: Our compliance specialist ensures that regulatory requirements are integrated into the development process.
• Project Management: Our project manager has extensive experience in coordinating complex projects, ensuring timely and efficient delivery.

To validate feasibility:

• We will follow best practices in software development
• Incorporate compliance considerations from the outset, guided by our compliance specialist.
• Develop and test the POC in stages, allowing for iterative improvements and validations.

We will maintain transparency and accountability by:

• Providing regular progress updates.
• Managing funds responsibly with clear accounting.
• Delivering on predefined milestones and deliverables.

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

Outputs:

Requirements gathering and design specifications for the POC interface and backend infrastructure.

Acceptance Criteria:

detailed technical and functional specifications for our POC platform

Evidence of Completion:

Link to design document (pdf) outlining system architecture and first UI designs

Outputs:

Development of smart contracts for minting and burning the EUR stablecoin on Cardano.

Acceptance Criteria:

Fully tested smart contracts deployed on a testnet, demonstrating core functionality.

Evidence of Completion:

Access to testnet smart contracts and documentation of test cases and results.

Outputs: Development of backend infrastructure integrating smart contracts with the user interface.

Acceptance Criteria: Operational backend services facilitating communication between the UI and blockchain.

Evidence of Completion: Deployed backend services with documentation and API references.

Outputs: Development of the user interface allowing users to mint/burn the stablecoin.

Acceptance Criteria: Functional UI connected to backend and smart contracts, enabling user interactions in test environment.

Evidence of Completion: Access to the POC interface, demonstration videos, project-close out report and video

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

Lead Project Manager: Oversees the entire project, coordinates between technical, and development teams, manages timelines, milestones, and ensures all deliverables.

Blockchain Developer (Cardano): Leads the technical analysis of Cardano’s infrastructure, identifies gaps, and develop the smart contract. The developer specializes in Cardano development, smart contracts, and technical architecture.

Frontend Developer: Develops the frontend based on the guideliens of the UI/UX designer.

External Partnership: We plan to collaborate with an UI/UX designer. This designer will provide detailed guidance on the best UI/UX practices and allows us to design a visually appealing platform.

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

The total budget for this project is 94,000 ADA, allocated to ensure comprehensive coverage of all necessary activities for successful completion.

Smart Contract Development and Integration: 35,000 ADA

This covers the development of the smart contracts for minting and burning the POC EUR stablecoin on Cardano. It includes testing, and integrating the smart contracts with the backend infrastructure.

Backend Infrastructure Development: 20,000 ADA

This budget covers the creation and deployment of backend services that will manage interactions between the user interface (UI) and the Cardano blockchain. The backend will handle transaction processing, user requests, and data storage, ensuring smooth communication with the smart contracts. Additionally, it includes the necessary tools and resources for building a scalable and secure infrastructure.

User Interface (UI) and Frontend Development: 20,000 ADA

This includes designing and developing a smooth user experience for users to mint and burn stablecoins. The frontend development will include full integration with the backend services, responsive design, user authentication.

Project Management and Coordination: 12,000 ADA

The project management allocation covers the efforts of overseeing the project, coordinating between legal, technical, and design teams, and ensuring that all milestones are met on time and within budget. This role also involves communication with stakeholders and ensuring proper management of the development workflow.

Miscellaneous Expenses: 7,000 ADA

This includes administrative costs, contingency funds for unforeseen expenses, and minor costs related to the dissemination of reports, such as publishing fees, hosting online resources, and operational expenses. Having this reserve allows flexibility in addressing any unexpected challenges that may arise during the project.

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

This project offers substantial value by delivering a tangible, working POC that demonstrates the feasibility of a stablecoin on Cardano. The investment accelerates the development of compliant DeFi solutions, attracting users and institutional interest.

Our budget is carefully allocated to ensure efficient use of funds, leveraging experienced professionals to deliver high-quality outputs.