Ecosystem Grant Proposal: Grant to Daosim Systems for the implementation of PowerAgent in SupremeDAO (CVP Holder Voting on Snapshot currently open)
Web3 and DeFi have enabled access to global liquidity and investment opportunities, however, complexity, information overload, risk management, and high volatility remains challenging and time-consuming. To bring the next billion users to DeFi we need a more accessible solution that simplifies treasury management, web3 investments, and interactions with DeFi protocols while maintaining an acceptable risk/reward ratio.
SupremeDAO is a venture project by Daoism Systems in its early stages that aims to be a fully trustless and automated system for reinvesting liquidity into various DeFi projects. For this purpose, we require automated smart contract execution. After analyzing existing technologies on the market such as Gelato, we have concluded that the flexibility of PowerAgent V2 aligns best with our long-term development objectives for full integration.
Central to the project are investment strategies aimed at generating yield. To kickstart the project, we will gradually design and make these strategies available to the users. PowerAgent aims to automate the execution of strategies and, therefore, provide users with one-click access to sophisticated DeFi strategies.
CurveFinance ecosystem is rapidly evolving, however most of the products around it are still cumbersome and hard to use. That’s why we came up with a strategy that will enable leveraged wstETH staking and yield generation on Aura all combined in one transaction and automated with PowerPool Agent. We will start with borrowing crvUSD against wstETH collateral to provide borrowed liquidity to a COIL/USDC pool on Aura. COIL is a token of SpiralDAO, which was launched this year, offering an Annual Percentage Rate (APR) of over 100%. Our strategy is based on the following steps:
1. Stake on Aura:
To implement the strategy, the following steps are needed:
- Buy wstETH on curve.fi
- Open CDP on https://crvusd.curve.fi/
- Borrow crvUSD
- Exchange crvUSD to USDC on Curve
- Provide liquidity to the COIL/USDC Pool on Balancer
- Stake LP tokens on Aura Finance
- The farmed rewards are automatically restaked and/or used to improve the collateral health (see next step).
2. Collateral health monitor:
The new “soft liquidation” feature by Curve offers a lower risk of full liquidation; however, a risk mitigation strategy is still necessary to avoid losses. Therefore, our goal is not to lose collateral on soft liquidations when the price is too volatile. To achieve this goal, we will take the following steps:
- Check dynamic collateral health status (every 1 hour)
- If collateral health goes lower than 15%, sell some of farmed CRV to crvUSD to increase the health status
3. On withdraw:
If a user wants to withdraw their investment and generated yield, the following steps need to be done:
- Withdraw LP tokens from Aura with X% staked
- Send to Curve and close a X% of the CDP (n USD)
- Withdraw (n USD) worth of wstETH from the CDP
- Send (n USD) worth of wstETH to the user
As you can see, the strategy requires many steps, time investment, and knowledge of the protocols used to implement it. Our goal with SupremDAO is to automate these steps to ensure the users have the best possible experience.
PowerAgent enhances the system’s functionality by enabling automated interactions between the Oracle and Strategy Module. This ensures real-time data utilization and efficient execution of strategies.
- The Price Oracle module needs to be triggered regularly, such as every hour, to ensure the system has up-to-date and accurate pricing information.
- The Strategy module is responsible for executing various strategies, and PowerAgent will trigger their execution based on the number and purpose of the strategies.
Roadmap / Deliverables
- Design a working prototype to demonstrate core features:
- Define product’s main functionalities.
- Develop a basic simulation in Python.
- Smart Contract (SC) with test coverage:
- Design and code the smart contract.
- Write and run thorough tests.
- Deployment of SC on the mainnet:
- Deploy and verify the contract.
- Fully functional product interface:
- Design and finalize the UI/UX.
- Implement frontend functionalities.
- Deploy the front-end app accessible through an iframe.
For steps one to four, we estimate a total duration of five to six weeks.
By completing the proposal, the Powerpool community will benefit from a functioning automated DeFi use case. The growth and expansion of SupremeDAO, along with the potential utilization of PowerAgent in future strategies, will attract more projects to the ecosystem.
1 x Sr. backend engineer
1 x Sr. frontend engineer
1 x Project Manager
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. The payment will be split into four stages, linked to the successful achievement of each of the four milestones described in the “Roadmap / Deliverables.” We will receive $5,000 worth of CVP tokens upon the completion of each milestone.
SupremeDAO is the main DAO venture of Daoism Systems, a tech studio building autonomous internet organizations, DeFi protocols, and tooling for a permissionless, user-empowered future. Founded in 2022, our project portfolio includes the decentralized Safe registry with Ceramic, DoinGud DAO, Balancer, and PrimeDAO.