This grant proposal aims to fund the development and implementation of Breadchain’s integration with PowerPool for three different use cases. Breadchain is exploring building applications from a post-capitalist point of view and we find PowerPool to be an important potential partner in helping us build this through automation.
The use cases we are planning to build include 1) automated yield fund disbursement coming from the Bread Crowdstaking Application 2) treasury management (optimize BREAD minting and liquidity availability on DEXs) and 3) automated EigenLayer reward conversion into BREAD. We believe these three use cases are good starting points to exploring more potential uses for PowerPool in the long term.
Additionally we plan on using the partnership as an opportunity to share PowerPool in our community by writing articles about how automation can be leveraged for innovative post-capitalist use cases of crypto using our implementations as examples. We will also share on social media about the partnership to help market PowerPool.
The automations developed by Breadchain using this grant will be using the PowerAgent v2 network on Gnosis Chain. This integration will help automate our on-chain protocol operational logic for fundamental processes involving governance, treasury management, and a new application with EigenLayer. As part of the implementations, there will be public documentation for how they work.
The Bread Crowdstaking Application generates yield for the cooperative and we would like to automate how we distribute that yield among the projects in the federation from a post-capitalist framework. We believe that this begins with incorporating an assortment of different mechanisms that reduce the influence of big capital while also encouraging the creation of BREAD. The assortment of mechanisms we are looking into deploying include:
- BREAD token voting
- Simple pre-determined distribution
- Combined token voting
- Conviction voting
- Post-Capitalist Gitcoin Grant Rounds
- Conditional Funding
The Power Agent would help automatically disburse funds based on the yield being collected from the crowdstaking application as well as democratic input from users based on the combination of mechanisms we choose to use. This is a clear non-financial use case for utilizing PowerPool’s technology that could be helpful in identifying solutions for governance that many DAOs face.
This fits into the Automated fund-management strategies as listed by the PowerPool docs use cases.
Breadchain’s treasury is largely held in BREAD when possible however we also want to ensure that there is liquidity available for those who want to swap their BREAD for other assets. This is important because we don’t want to encourage people to burn their BREAD so that it stays in circulation and accumulates yield for the cooperative.
With the excess treasury funds, we will use PowerPool to manage and optimize our treasury with liquidity needs for the larger ecosystem. The tokens we want to optimize between include BREAD, xDAI, and EURe on Gnosis Chain. We believe that this job is able to be done with already existing kinds of automations made previously for trading strategies using PowerPool.
This is similar to the Balancer v2 asset managers as listed by the PowerPool docs.
With the upcoming launch of EigenLayer and its market, we suspect that this will be a prime opportunity to become an early contributor and beneficiary. As a way to increase TVL of BREAD, we want to allow users to automatically convert their EigenLayer rewards into BREAD to help support our vision. We will use PowerPool to automate that process for users.
We will implement Resolver Jobs for bridging and and swapping the rewards based on current gas fees and accumulated amount. As outlined below, the swapping and bridging are only financially favorable when a certain amount of rewards of different kinds has accumulated and when network prices on both Ethereum and Gnosis are optimal. This fits into the Automated fund-management strategies as listed by the PowerPool docs use cases.
In addition to utilizing PowerPools’s technology for our product and on-chain governance initiatives, we will be using our ecosystem to spread awareness about PowerPool. Here are some of the things that we plan on doing.
- Write articles regarding our collaboration and ecosystem partnership, announcements regarding the Job launches, and explanations for how the final products work including on-chain stats,etc. We have written several articles already on our Mirror blog that break down our political and technical goals and achievements here.
- Publish posts regarding our collaboration and mutual marketing efforts through Twitter and our discord community
- Ensure PowerPool becomes an automation partner for Breadchain ecosystem projects as the federation grows and is the first solution we turn to for our automation needs
- Each grant completion milestone and the initial grant provision will be covered by co-marketing activities from Breadchain/PowerPool to bring maximal awareness to both communities
Outline the design specs for each of the PowerPool implementations
- Define Offchain infrastructure and integration
- Define Resolver Jobs
- Define Resolver function algorithm for liquidity balancing
- Define oracle integration for EURe
- Defining Resolver function based on gas prices, accumulated reward, oracle integration for evaluation of different ERC20 Token rewards
- Outlining Smart contract integration with Eigenlayer
- Outlining bridging (Ethereum Resolver) and automatic minting (Gnosis post bridge Resolver)
Smart Contract Development and Testing
- Onchain Governance
- Breadchain Project integration
- Connection to Yield & Treasure infrastructure
- Treasury <> Liquidity Pool Interface if needed
- Safe Multisig Guard for yield/reward distribution enforcement
- Bridging Mechanisms
- Gnosis Bridge Handler for minting and swapping
- e2e testing for offchain \ onchain flows
- Fuzzy testing for liquidity balancing mechanism
- General testing for purely onchain flows
Test Resolver / Automation Jobs and deployment
- Begin integrating automations into the flows
- Deployment on Gnosis Chain
- Establishing multisig for upgradeablity
- Establishing governance oversight mechanism for deployments
- Open source and verified deployments
Creation of user interfaces
- UX/UI experience for BreadChain governance participation
- Safe Multisig App for Eigenlayer rewards integrations
Breadchain Cooperative is a collective of decentralized cooperative projects looking to advance a progressive vision for blockchain and its potential to transform society. We aim to do this by building and utilizing what we call “solidarity primitives.” We define solidarity primitives as development tools which can help to forge solidarity between individuals and collectives. The development of these tools is crucial for building non-financialized forms of coordination enabled by blockchains. Web3 presents the unique opportunity to significantly expand on the notion of collective governance, a novel terrain for embedding solidarity into our digital systems.
The first solidarity primitive we’ve built is the Bread Crowdstaking Application. This smart contract accepts a user’s DAI and forwards it to a lending pool. In exchange, the staker receives BREAD tokens, minted at a 1-to-1 ratio with the collateralized DAI. All of the interest earned on the staked DAI is automatically sent back to Breadchain, to help fund the Collective and its various member projects. As a result, the Crowdstaking Application functions as a fundraising engine for the Breadchain Cooperative, and a collectively owned credit union, while the BREAD token acts as a local currency within the ecosystem, promoting financial sustainability.
At the moment, the Breadchain Crowdstaking Application is deployed on the Polygon POS blockchain generating yield from users giving DAI to be lended out on Aave. At the same time, we are hard at work at developing a new front end for the application, a brand redesign, and the BREAD dashboard. Ari (Arrakis CTO and smart contract developer for the current app) has proposed that we move the application to Gnosis in order to take advantage of the DAI savings rate token (sxDAI) on Gnosis to receive a higher yield (guaranteed 5% but likely more) on our collateral through Agave. In addition there are potential benefits to moving to Gnosis including the fact that the app would then only require one token by the user (xDAI) in order for it to be usable, making it more user friendly. As well, Gnosis is soon to launch Gnosis Pay which will allow people to be able to spend EURe through a normal debit card connected to a Safe wallet on Gnosis Chain. This pivot seems to make a lot of sense from both an economic, technical, and utility standpoint. However this means that we need to manage the move to a new chain. We will move most of the collateral from Polygon to Gnosis and airdrop the new BREAD on Gnosis to the current holders during a live streamed event in order to be transparent about the process and coincide with the other developments.
For the implementation, testing, writing of the tutorial & blog post, and scaling of PowerAgent in our system according to the development plan, we would like to request 20.000USD paid in CVP tokens.