T-Minus : NFT Call Option Platform Built with Marlowe

[GENERAL] Name and surname of main applicant

Professor Kale

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

Entity (Not Incorporated)

[GENERAL] Co-proposers and additional applicants

Mad Sushi - xtminus.io

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

12

[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)

By building a decentralized call option platform for NFT. It allows holders to earn income, provide affordable exposure to price increases, stabilize prices, enhance liquidity, and manage risk.

[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

All the Marlowe smart contracts will be open source and the application frontend will also be open source to demonstrate Marlowe TS-SDK. The open-source license will be Apache 2.0

[METADATA] Horizons

DeFi

[SOLUTION] Please describe your proposed solution

Our team will build a platform for a selection of bluechip NFT projects in Cardano to have access to a decentralized peer-to-peer call option marketplace that utilizes the technology of Marlowe.

The platform grants NFT holders the ability to write call options on their assets. The option premium can be set manually. The system leverages Marlowe's Open Role to allow any potential buyer to engage in a trade. The option settlement requires no oracle nor any third party. The whole flow is transparent and decentralized.

We picked Marlowe as the development stack because of its smart contract which is open source by default. When assets are locked in a smart contract, the participants should be able to verify each stage. NFT option sellers and buyers no longer need to deal with a complex DeFi system that relies on external oracles and transaction batching bots.

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

We believe NFT is the gateway for new users to get involved with DeFi. Given the already established NFT communities in Cardano, adding a call option function built with Marlowe 3 valuable things can be achieved:

1, Introduce DeFi to NFT enthusiasts who might not be familiar with DeFi or NFTfi.

2, Introduce Marlowe to more users. It comes with an additional explorer which brings further transaction and smart contract details.

3, Introduce income generation for NFT assets. Add more diversity to NFT trading.

The impact of our project will be measured in two ways:

All the option trading transactions can be looked up on-chain. This shows the most realistic impact in the Cardano space.

Another way to measure the impact is by assessing community interaction on Discord and Twitter.

We will share all the metrics mentioned above. Especially we will reach out to some of the top Cardano NFT projects for collaboration. We will work closely with the Marlowe community as well to provide feedback on our development journey and results.

[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 members at T-Minus.io have been in the blockchain space since 2017. We have studied Marlowe meticulously and have already built a working Dapp on Cardano Mainnet as T-Minus Lockdrop.

We have built great relationships with CNFT projects and we understand the mindset and pain points of NFT traders and project maintainers.

In terms of software engineering abilities, we have built and tested many different DeFi smart contracts written in Marlowe.

All the components of Marlowe such as Marlowe TS-SDK, Marlowe Runtime, Marlowe Payout Dapp, Marlowe Runners have been fully researched and operated in-house.

Besides Marlowe, we are also very experienced with other aspects of Cardano such as transaction serialization, working with UTXOs, node operations, and native assets issuance.

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

Smart Contract and Logic Flow

Milestone outputs:

Design and complete the Marlowe smart contract for writing an NFT call option by an asset holder.

Acceptance criteria:

The entire life cycle of NFT call option trading needs to be successfully computed. From NFT collateral locking by the seller, buyer paying option premium, and buyer exercising the option, to asset settlement and trade termination.

Evidence of milestone completion:

Such a smart contract will pass the tests on Marlowe Playground with a fixed Role setting. Open role smart contract will have to pass the end-to-end testing using Marlowe TS-SDK or marlowe_cli command line interface. The smart contract source code will be shared and released on GitHub.

UI/UX Design and Mock Website

Milestone outputs:

Fronted design with UI/UX tailored to fit the steps of executing Marlowe smart contract by different parties.

Acceptance criteria:

An interactive mock application built with NextJS.

A user can explore each function from My Assets, My Options, Write Option, Buy Option, to Payout.

Evidence of milestone completion:

The mock application will be hosted on Vercel for a certain period. The code base will be open source on GitHub.

Full Stack Integration with Smart Contract

Milestone outputs:

Building a complete platform using NextJS and Marlowe Typescript SDK to interact with NFT call option contracts. This will work with Cardano Preprod Testnet assets.

Acceptance criteria:

Given the provided Preprod Testnet NFT asset, an end-to-end workflow can be step-by-step conducted by a seller and a buyer on the application website. This covers all the operations allowed in the smart contract.

Evidence of milestone completion:

A live website will be hosted on Vercel. The required Preprod Testnet NFT assets will be issued for testers to try out. All the smart contract and frontend code will be open source for evaluation.

Mainnet Live Operation

Milestone outputs:

Operate NFT call option platform for 3 months to collect user feedback and collaborate with major NFT projects in Cardano to engage more potential users. A marketing campaign will be kicked off to boost participation.

Acceptance criteria:

The on-chain data for all NFT call option trading transactions will be available as public data. During the 3 month pilot period, many different NFT call options will be created. Some will lead to successful settlement, some will not find a buyer. The successful operations of the platform for 3 months will be the bare minimum. We look forward to keeping the platform going for as long as we can.

Evidence of milestone completion:

We will conduct a study on the off-chain and on-chain data over all the NFT call option transactions. This will cover all transactions which include both successful trades and aborted trades. A final report will be released to the public. Also, a video will be produced to demo the live website workflow for NFT call option trading.

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

Professor Kale

Project manager and tech lead

• Research and development
• System architecture
• Smart contract prototyping

Mad Sushi

UI/UX design and visual assets

• User Interface design to match NFT option trading with Marlowe workflow
• Optimizing user experience for NFT option trading
• Administration work

Jeff

Smart contract and Marlowe

• Marlowe smart contract auditing
• Marlowe TS-SDK for on-chain interaction
• Marlowe and Cardano Infra

Walter

Backend design and API

• Database design
• Cloud backend infra
• API Endpoints

Shawn

Frontend NextJS

• NextJS and Marlowe TS-SDK integration.
• Implementation of UI/UX design into frontend website
• Testing and optimizing off-chain and on-chain interactions.

Our team members are active in the #marlowe-community channel in IOG's Technical Community Discord. We have a direct line of communication with the core developers of Marlowe.

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

Milestone 1: Smart Contract and Logic Flow

Timeframe: 2 Months  

Budget: ₳16,000  

Cost Breakdown (₳)

R&D

5000

Marlowe Smart Contract Development

10000

Testing

1000

Total

16000

Milestone 2: UI/UX Design and Mock Website

Timeframe: 3 Months  

Budget: ₳25,200  

Cost Breakdown (₳)

Project Management

4200

Frontend Development

10000

User Interface Design

5000

User Experience Design

5000

Proprod Testnet Infrastructure

1000

Total

25200

Milestone 3: Full Stack Integration with Smart Contract

Timeframe: 4 Months  

Budget: ₳44,600  

Cost Breakdown (₳)

Project Management

5600

Frontend Development

11500

UI/UX Optimization

4000

Backend & API Development

8000

Marlowe TS-SDK Integration

14000

Cloud & Testnet Blockchain Infrastructure

1500

Total

44600

Final Milestone: Mainnet Live Operation

Timeframe: 3 Months  

Budget: ₳19,200  

Cost Breakdown (₳)

Security Audits

5000

Community Engagement & Incentives

6700

Data Collection & Analysis

4000

Video & Reporting

1000

Cloud & Mainnet Blockchain Infrastructure

2500

Total

19200

Total Budget: ₳105,000 

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

The cost of our project represents significant value for money for the Cardano ecosystem, particularly when considering the strategic allocation of resources and the potential long-term benefits. Firstly, our wage budget is significantly lower than the average budget for software development, which typically ranges from $50,000 to $250,000. We achieve this by leveraging our personal time contributions, allowing us to maximize value and efficiency. 

Moreover, the investment in high-quality resources and skilled professionals is crucial for the success and sustainability of the project. By ensuring that we have the right talent and tools, we can deliver a robust and innovative solution that will benefit the Cardano ecosystem in the long run. This strategic investment is expected to yield significant returns, both in terms of technological advancements and community growth in the following categories :

New Utilities for NFTs

Our project introduces new utilities for NFTs within the Cardano ecosystem, enhancing their value and functionality. By developing NFT call option, we aim to transform NFTs from mere digital collectibles into versatile assets. This includes integrating NFTs into decentralized finance (DeFi) platforms, enabling them to be used as collateral for call option settlement, and earn income from option premium.

Increase Awareness for Marlowe

Increasing awareness for Marlowe, Cardano's domain-specific language for financial contracts, is another key objective of our project. By promoting Marlowe through integrated UI/UX, Marlowe tools, and community engagement, we aim to highlight its potential to revolutionize the way financial agreements are created and executed on the blockchain. By raising awareness and understanding of Marlowe, we can drive its adoption and integration into various financial applications, further strengthening the Cardano ecosystem.

Concept of Not Depending on Any Oracle for Price Feed

One of the innovative aspects of our project is the concept of not depending on any oracle for price feed. By eliminating the reliance on external oracles, we enhance the security and reliability of our platform. This approach reduces the risk of manipulation and ensures that our system remains decentralized and trustless. Instead, we utilize on-chain mechanisms and smart contract design to give the decision of settlement back to users, aligning with the core principles of blockchain technology.

Transparent Contract and State Change Status

Transparency is a cornerstone of our project. We ensure that all contracts and state changes are fully transparent and verifiable on the blockchain. This means that every transaction, contract execution, and state change can be audited by any participant, fostering trust and accountability. By providing real-time updates and detailed logs of all state changes, we empower users with the information they need to make informed decisions and verify the integrity of the system.

In conclusion, the costs associated with our project are not only justified but also represent a prudent investment in the future of the Cardano ecosystem. The introduction of new utilities for NFTs, increased awareness for Marlowe, the concept of oracle independent DeFi, and transparent contract and state change status are strategic initiatives that will drive growth, innovation, and adoption within the Cardano community.