Cross Chain DeFi - Perpetuals and Lending - Pondora

[Proposal setup] Proposal title

Please provide your proposal title

Cross Chain DeFi - Perpetuals and Lending - Pondora

[Proposal Summary] Budget Information

Enter the amount of funding you are requesting in ADA

285000

[Proposal Summary] Time

Please specify how many months you expect your project to last

5

[Proposal Summary] Translation Information

Please indicate if your proposal has been auto-translated

No

Original Language

en

[Proposal Summary] Problem Statement

What is the problem you want to solve?

Pondora introduced the first general purpose DeFi smart accounts to Cardano Mainnet with initial support for trading, but additional high-value features still require audits.

[Proposal Summary] Supporting Documentation

Supporting links

• https://docs.pondora.org
,
• https://beta.pondora.org
,
• https://pondora.org

[Proposal Summary] Project Dependencies

Does your project have any dependencies on other organizations, technical or otherwise?

Yes

Describe any dependencies or write 'No dependencies'

We will rely on independent third party Cardano firms to conduct the security audit and provide resulting reports.

[Proposal Summary] Project Open Source

Will your project's outputs be fully open source?

Yes

License and Additional Information

This project’s outputs (audit reports) will be made publicly available while the smart contract code will be released under a Business Source License (BSL), converting to fully open source after a fixed period.

[Theme Selection] Theme

Please choose the most relevant theme and tag related to the outcomes of your proposal

Audit

[Campaign Category] Category Questions

Describe your established collaborations.

This project will be conducted directly by Pond Labs by contracting one of the established independent audit firms in the Cardano ecosystem.

The primary choice for an audtor will be https://www.invariant0.com subject to availability, as this is the same firm that audited the latest version of existing Mainnet features.

Describe funding commitments.

The full cost of all development, growth, marketing, etc thus far has been funded by Pond Labs.

The requested amount for this proposal is limited to the purpose of covering audit costs and any additional development required as part of this process.

Any additonal costs not covered by the requested amount will be absorbed by Pond Labs.

Describe your key performance metrics.

• Smart account TVL
• Smart account transactions - combined (Daily, Weekly, Monthly)
• Cross Chain account transactions (Daily, Weekly, Monthly)
• Cross Chain account creations (Daily, Weekly, Monthly)
• Trading Volume in ADA (Daily, Weekly, Monthly)
• Lending Volume in ADA (Daily, Weekly, Monthly)
• Perpetual Trading Volume in ADA (Daily, Weekly, Monthly)

[Your Project and Solution] Solution

Please describe your proposed solution and how it addresses the problem

Current Status:

The following unique features are currently supported by the Pondora protocol on Cardano Mainnet:

• Full UTXO-based Account Abstraction
• DeFi intents, allowing the use of the same assets over different protocols
• Automatic UTXO Defragmentation - automatically optimizes account outputs for lower fees and dApp compatibility
• Bulk order management. Create, edit or cancel thousands of swap orders with a single transaction for less than 0.5 ADA in network fees.
• Transact with signed messages instead of full transactions, paying zero network fees.
• Session-based passwordless trading, similar to Photon.
• A novel Smart Account based Central Limit Order Book Dex
• Interoperability and aggregation of existing Cardano Dex protocols

Additional Features:

Pondora has been built as a modular set of extensible smart contract components. In addition to the above, the following features have also already been developed:

1. Account Abstractions for most major blockchain networks. (eg. Bitcoin, Ethereum, Solana, Sui, etc). This allows wallets of these networks to interact directly with Pondora, and by extension any dApps Pondora aggregates.

2. DeFi Oracles. This extends the smart account to serve as a decentralized oracle network specifically for DeFi applications.

3. Lending - introduces Lending features to the smart account, extending the order book model with an advanced virtual pooled Lending protocol and aggregator.

4. Perpetuals - extends the CLOB model to support Perpetual positions with leverage, taking full advantage of the UTXO model to improve upon popular implementations (eg. Hyperliquid)

This proposal aims to accelerate the rollout of these features by funding the cost of a thorough audit process.

[Your Project and Solution] Impact

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

Pondora already brings a massive improvement in UX and DeFi capabilities to Cardano for trading. But its greatest strength as a protocol is that the smart account allows participation across multiple protocols concurrently.

Each additional feature accelerated through this proposal therefore represents an exponential increase in the platform’s ability to increase volume and DeFi participation, both from within and outside the Cardano ecosystem.

Cross chain accounts brings a powerful, frictionless onboarding tool for other ecosystems, where users may find familiar UX and features (eg. passwordless trading) and a single place to interact with Cardano DeFi.

DeFi Oracles help address the severe lack of sufficiently decentralized oracle sources within our ecosystem by making participation effortless and with strong incentives - a critical component for a trusted Lending or Perpetual protocol.

Both Lending and Perpetuals trading benefit immensely from properties unique to the smart account, allowing for much lower fees, fewer risks and added flexibility for all parties.

Overall, these represent huge steps forward for Cardano DeFi.

[Your Project and Solution] Capabilities & 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?

The project is led by a strong, capable team with over 4 years of full-time experience building Cardano dApps. Even though Pondora was only recently released, the quality, novelty and scale of innovation present in the existing Mainnet version of Pondora represents a shining example of the team’s capabilities.

Additionally, this proposal’s scope is limited to the funding of feature audits, while any prior research and development has already been completed. Feasibility is therefore very easy to validate as it relies on following the same process that has already been completed for existing features.

In the same way, this makes milestones clear and very straight forward to validate.

[Milestones] Project Milestones

Milestone Title

Independent Security Audit - Cross Chain Accounts

Milestone Outputs

• Completed security audit conducted by an established Cardano audit firm.
• The relevant smart contracts deployed to Cardano Mainnet.
• Transaction activity proving that the smart contracts have been used.

Acceptance Criteria

• All findings in the report (if any) should be marked as resolved to the satisfaction of the auditor.
• Audit report should include a unique on chain reference to the deployed contracts.
• Mainnet transaction activity proving that the smart contracts are being used.

Evidence of Completion

• A publicly available PDF of the audit report.
• A publicly available link proving the relevant smart contract address(es).
• A publicly available link showing the on-chain activity.

Delivery Month

1

Cost

42750

Progress

20 %

Milestone Title

Independent Security Audit - DeFi Oracles

Milestone Outputs

• Completed security audit conducted by an established Cardano audit firm.
• The relevant smart contracts deployed to Cardano Mainnet.
• Transaction activity proving that the smart contracts have been used.

Acceptance Criteria

• All findings in the report (if any) should be marked as resolved to the satisfaction of the auditor.
• Audit report should include a unique on chain reference to the deployed contracts.
• Mainnet transaction activity proving that the smart contracts are being used.

Evidence of Completion

• A publicly available PDF of the audit report.
• A publicly available link proving the relevant smart contract address(es).
• A publicly available link showing the on-chain activity.

Delivery Month

2

Cost

42750

Progress

40 %

Milestone Title

Independent Security Audit - Lending

Milestone Outputs

• Completed security audit conducted by an established Cardano audit firm.
• The relevant smart contracts deployed to Cardano Mainnet.
• Transaction activity proving that the smart contracts have been used.

Acceptance Criteria

• All findings in the report (if any) should be marked as resolved to the satisfaction of the auditor.
• Audit report should include a unique on chain reference to the deployed contracts.
• Mainnet transaction activity proving that the smart contracts are being used.

Evidence of Completion

• A publicly available PDF of the audit report.
• A publicly available link proving the relevant smart contract address(es).
• A publicly available link showing the on-chain activity.

Delivery Month

3

Cost

57000

Progress

60 %

Milestone Title

Independent Security Audit - Perpetuals - Basic

Milestone Outputs

• Completed security audit conducted by an established Cardano audit firm.
• The relevant smart contracts deployed to Cardano Mainnet.
• Transaction activity proving that the smart contracts have been used.

Acceptance Criteria

• All findings in the report (if any) should be marked as resolved to the satisfaction of the auditor.
• Audit report should include a unique on chain reference to the deployed contracts.
• Mainnet transaction activity proving that the smart contracts are being used.

Evidence of Completion

• A publicly available PDF of the audit report.
• A publicly available link proving the relevant smart contract address(es).
• A publicly available link showing the on-chain activity.

Delivery Month

4

Cost

71250

Progress

80 %

Milestone Title

Independent Security Audit - Perpetuals - Advanced

Milestone Outputs

• Completed security audit conducted by an established Cardano audit firm.
• The relevant smart contracts deployed to Cardano Mainnet.
• Transaction activity proving that the smart contracts have been used.

Acceptance Criteria

• All findings in the report (if any) should be marked as resolved to the satisfaction of the auditor.
• Audit report should include a unique on chain reference to the deployed contracts.
• Mainnet transaction activity proving that the smart contracts are being used.

Evidence of Completion

• A publicly available PDF of the audit report.
• A publicly available link proving the relevant smart contract address(es).
• A publicly available link showing the on-chain activity.
• Project close out Video

Delivery Month

5

Cost

71250

Progress

100 %

[Final Pitch] Budget & Costs

Please provide a cost breakdown of the proposed work and resources

Based on an estimated price of 0.7 USD per ADA.

Total budget: ~$200,000

The cost of each milestone includes both the audit and any post-audit development required. The following is loosely based on the cost incurred by Pond Labs for prior features and the relative complexity of each set of smart contracts.

Milestone 1: Cross Chain Accounts

$30,000

Milestone 2: DeFi Oracles

$30,000

Milestone 3: Lending

$40,000

Milestone 4: Perpetuals - Basic

$50,000

Milestone 5: Perpetuals - Advanced

$50,000

Any additional development costs over and above this will be covered by Pond Labs.

[Final Pitch] Value for Money

How does the cost of the project represent value for the Cardano ecosystem?

This proposal represents excellent value for money because the bulk of the research and development has already been completed through self-funded efforts by the team.

The requested funds are primarily to cover the costs of independent audits, adding high assurance to the deployed solution. This makes it a highly cost-efficient proposal with a massive impact relative to the funding amount requested.

[Required Acknowledgements] Consent & Confirmation

Terms and Conditions:

Yes