Decentraland

by 0xa7b100ecd7dbf8445688297d889394d001563a87

Should the following $64,000 grant in the Platform category be approved?

Abstract

Currently, Decentraland users are utilizing third-party trading platforms whenever a user wants to swap in or out of assets, particularly $MANA. This is actively extracting capital out of the Decentraland ecosystem with every swap. We propose introducing a native Decentraland DEX to encourage ecosystem users to swap in and out of $MANA on a native platform.

Our core contract functionality will have 60% of all swap fees paid directly to the Decentraland treasury, with the remaining amount supporting development and maintenance costs on the DEX. Additionally, all code will be open-sourced to the desired specifications of the Decentraland DAO in order to maintain security, decentralization, and transparency for the community.

Grant size

64,000 USD in DAI

Project duration

3 months

Beneficiary address

0x61336bCF79131CEc9955f3884321b00d1EA241Ed

Email address

alex@solidity.io

Description

Implementing a Decentraland community-first DEX would be a key step in creating sustainable, on-chain infrastructure for the DAO. As a cash-flow generative and fundamentally Decentraland-backed asset, the DEX would provide a solid DeFi foundation for the ecosystem, and will benefit $MANA holders sustainably into the future.

With the Decentraland community containing many Web3 users and investors, the utility of an Decentraland DEX will generate significant value for existing holders, incentivize new Decentraland holders to join, bring liquidity providers into the $MANA ecosystem, and will create more demand for $MANA. Additionally, the fees derived from the DEX will serve to increase the DAO treasury value as a whole through DEX revenue. The core of this proposal is centered around our motivation to build for the community, and embrace Web3 values through the implementation of technically sound, user-friendly, DeFi infrastructure.

The goal of the Decentraland DEX is to create a self-sustaining, cash-flow generative addition of digital infrastructure to the Decentraland ecosystem. Major swaps like Metamask, Uniswap, Sushi, and GMX offer trading fees as high as .875%.

Decentraland DEX will provide: key trading pairs to allow our community to trade with a single DEX UI, competitive/lowest trading fees, charting, integration with other DAO infrastructure, top-of-the-line design and development, and more.

$MANA generates over $100m per day in trading volume on average. If the Decentraland DEX is able to capture just 1% of this volume, the Decentraland treasury could grow by $720,000 over one year. Our proposal represents less than 10% of this cost.

$MANA holders are valuable community members and the target market for DeFi products. Decentraland DEX offers $MANA holders a commercial incentive to support $MANA-backed infrastructure directly benefiting them and the DAO. DEX growth creates a flywheel of incentive for $MANA holders, driving further adoption.

Key value to highlight: DEX will attract $MANA liquidity DAO establishes core DeFi infrastructure Revenue to be directed to Decentraland DAO to increase treasury holdings Brings DeFi users into Decentraland

Specifications | Solidity.io 2 will design, develop, and deploy a decentralized exchange for the Decentraland DEX. The DEX will utilize modified Uniswap v2 core contracts to enable the decentralized exchange of ERC-20 tokens. All data points from the DEX will be aggregated to a decentralized datastore to enable real-time charting on the platform. Utilizing the customized Uniswap v2 contracts, an exchange SDK will be created to allow for an easy swaps of assets. The SDK will enable Decentraland builders to integrate native swaps on core Decentraland infrastructure. Builders will be free to skin the SDK into other core Decentraland infrastructure, allowing accessibility across the Decentraland community. This offers a new tool for platform developers to create innovative applications and integrations. Users can swap in and out of tokens utilizing the platform’s liquidity to perform transactions. The swap will display relevant information, including price impact, slippage, and deadline. In addition to swap, users will be able to add liquidity to pairs, this process will be a separate flow allowing users to customize their transaction.

Roadmap and milestones

Specifications | Solidity.io 2 will design, develop, and deploy a decentralized exchange for the Decentraland DEX. The DEX will utilize modified Uniswap v2 core contracts to enable the decentralized exchange of ERC-20 tokens. All data points from the DEX will be aggregated to a decentralized datastore to enable real-time charting on the platform. Utilizing the customized Uniswap v2 contracts, an exchange SDK will be created to allow for easy swaps of assets. The SDK will enable Decentraland builders to integrate native swaps on core Decentraland infrastructure. Builders will be free to skin the SDK into other core Decentraland infrastructure, allowing accessibility across the Decentraland community. This offers a new tool for platform developers to create innovative applications and integrations. Users can swap in and out of tokens utilizing the platform’s liquidity to perform transactions. The swap will display relevant information, including price impact, slippage, and deadline. In addition to swapping, users will be able to add liquidity to pairs.

Timeline & Steps To Implement | Vote approved, development begins DEX UX/UI Design Technical Architecture DEX Smart Contract development and testing Front-end Development and Integration begins 6 weeks to complete development Front-end Development and Integration Completion Smart Contract/Platform Internal Audit Smart Contract 3rd Party Audit Go-Live!

This proposal is summarized due to technical limitations. To view it complete and vote on it, visit the DCL DAO Governance dApp