Park
Park, the base of any good hyperstructure. PoC AMM merging governance with liquidity provision on Scroll. It creates greater protocol alignment and has built-in democratic (through Worldcoin Proof of Humanity) governance features to ensure long-term viability.
Park
Created At
Winner of
WalletConnect - Innovation Pool Prize
Prize Pool
Scroll - Deploy on Scroll
Prize Pool
Project Description
One of the biggest problems with DeFi is the discrepancy between those who provide value (liquidity, volume) for a protocol and the governance token. This creates a perverse incentive structure wherein the backbone LPs of a protocol may not have any say over governance rights, and the token holders may only be interested in the short-term profitability of the protocol without any other considerations. We see Uniswap as a prime example of this model, where UNI provides governance rights, the "threat" of a fee switch, and VC pressure on Uniswap Labs. LPs are entirely separate entities with very different goals and incentives like long-term volume and efficiency.
Our project aims to merge these two interests by tying the governance rights to the time-weighted stake of an LP. Initially, we considered including a stake-weighted approach. Still, we decided to make it fully democratic, only require users to have a specific amount of LP tokens, and make it a one-vote-one-person system by requiring Proof of Humanity via WorldID and anonymous actions. Unfortunately, we were unable to complete the Worldcoin integration, as they are not available on Scroll or Scroll testnet at the moment, but the intention is to use their repo and input our smart contract + app ID details to make the integration flawless.
We chose to deploy the protocol on Scroll Sepolia, since the ecosystem is still developing and there is still room for a native DEX. Additionally, without a native token to misguide incentives, we envision the primary pairs being staked-ETH stable pairs or interest-bearing stablecoins like sDAI and GHO, which will provide volatility-free yield along with governance rights about the future of the hyperstructure.
We envision governance decisions to be made about a few things, including:
- A percentage of transaction fees go towards public goods
How it's Made
We started by modifying the Uni V2 contracts to include parameters for the first time a user deposits liquidity on the platform. A separate contract, VotingSystem.sol, implements governance features. It supports delegation of votes, calculates the time-weighted vote power of all users, and supports threshold and quorum requirements.
The frontend implements the Web3Modal V3 for wallet connections.
