PSP-IPΔ9: PSP Loan to launch a PSP/ETH AMM Pool on the DeversiFi Layer 2 + Bridges to Ethereum & Polygon

PSP/ETH AMM Liquidity Pool & Fast-Withdrawal Pool on the DeversiFi Layer 2

Keywords

PSP liquidity

Simple Summary

Provide DeversiFi Labs with a PSP loan in order to facilitate the seeding of a layer 2 PSP/ETH AMM pool and fast-withdrawal bridges, allowing the gas-free & private trading of PSP on Ethereum as well as fast & private transfers to Ethereum L1 and the Polygon Network

Context

DeversiFi, the Layer 2 exchange built on the StarkWare Validium scaling technology, has recently launched the first version of it’s Layer 2 AMMs in ‘testing mode.’ Upon successful completion of the testing period, the pools will be opened up to external LPs and a substantial liquidity mining program will start.

A similar proposal has been approved by the Lido DAO for a LDO/ETH pool on DeversiFi

https://app.deversifi.com/pools

Goals

If enforced, this proposal will ensure a cheap gateway to buy and sell PSP to more users. As PSP launches on new chains (BSC, Polygon, etc.), the fast-withdrawal bridge will also provide more options to PSP holders.

Means

In order for a PSP/ETH AMM pool to be opened on DeversiFi as quickly as possible, the DeversiFi developers would like to request a PSP token loan.

The PSP loan will also be used to seed a fast withdrawal bridge that enables the instantaneous and private withdrawals back to Ethereum layer 1. DeversiFi users can withdraw to a different address from which they deposited - useful for privacy both privacy, arbitrage and payments.

DeversiFi Labs can also add PSP to the DeversiFi<>Polygon bridge, allowing instant and low cost transfers of PSP from DeversiFi to the Polygon Network, giving Polygon users a low cost way of transferring and trading PSP.

The DAO can recall the loan at any time and there are no additional terms attached.

Metrics

PSP/ETH on DeversiFI pool volume

Fast withdrawal bridges usage volume

Forward-thinking considerations

This proposal introduces a PSP loan to Devesify developper that can be recalled or adjusted by the DAO at any time if deemed necessary.

Implementation overview

XXX PSP transferred to the DeversiFi Labs multisig: 0x520Cf70a2D0B3dfB7386A2Bc9F800321F62a5c3a

Voting options

Allocate 2M PSP to fund the AMM + fast Ethereum bridge + other/future fast bridges (Polygon etc)

Allocate 1.5M PSP to fund the AMM + fast Ethereum bridge

Abstain

DeversiFi Labs will match the portion of the PSP loan that is used to seed the AMM pool with it’s own ETH

18 Likes

Hello @RossMidd and thank you for this well thought-of proposal. I’m eager to see what’s the community response is, but I think it’s quite a synergistic approach and a timely one, as it would bring:

  • Liquidity for PSP on another cheap to use (+private!) medium + bridge
  • Fast withdrawal bridges to other sidechains PSP will be eventually available on, like Polygon.

Both can be achieved with a budget similar to our commitment with Bancor so I think the proposal is balanced and can be beneficial to both ParaSwap and Deverisfi.

There might be some slight adjustments left to do the proposal format, I’ll let the Scribes input on this.

7 Likes

Very happy to see this proposal!

Allowing the smallest holders to acquire PSP without staying on centralized chains is, I think, crucial.

1 Like

ZKsync or starknet?
I admit that I don’t have the technical knowledge to differentiate them

But it would be really crazy if it happened quickly for Paraswap yeah!

and possible to have rewards like sushiswap too ??
I’ll move my sushi LP if it happen ! I’m waiting for that

2 Likes

nice proposal, just kuz we are waiting 2021as the year of ZK adoption, especially starksnet.

2 Likes

Nice proposal, but if DAO agree what would be the timeline ?

1 Like

best layer 2 solution in eth will be zk and we see a competition in investing and developing on zk…starknet is a good developed one…polygon bought 400m$ worth platform that work specially on zk called mir followed by last acquiring hermez…so i think works in polygon cover all other solution in one place

DeversiFi is on Starkex by Starkware, ZKSync is another company.
Starkware has recently launched a new product called Starknet which is a more generalized implementation of Starkex.

1 Like

Sounds great, very excited for L2 adoption and especially the role Paraswap can play on there in general now that we see the first AMMs roll out.

Seeing that $psps trading starts in important DEXs like Deversifi before big Centralized EXs makes me proud about paraswap LOL

This is a very exciting proposal! Personally, I am not familiar with DeversiFi (yet!), but the prospect sounds super interesting, having a decentralised, multichain exchange would be amazing for the token, and the platform itself by proxy.

I’ve just got some questions about the proposal which I would love to hear more about:

  • I see a lot of mentions about a ‘loan’ of PSP. I’m assuming this is not being used interchangeably with a PSP grant? And if so, how will the loan be repaid? Will it be over a specific timespan? After a certain price is reached? Or will it accrue interest automatically paid by the protocol somehow?

  • The proposal mentions the developers themselves being interested in this proposal, but after a quick search I could not find more info? I’m sure that the proposal would go a lot more smoothly if the devs can expand on how simple this process would be, as well as sell the platform and explain how the DAO’s funding will be secured! After all , we are sending community funds to a multisig wallet.

  • Finally, and this is just a very minor thing, I assume this proposal is intended to go through once PSP is truly multichain? As of the time of writing, it’s only on BSC and ETH mainnets, so I guess the current implementation is for once the token gets imported into platforms like MATIC, or not? The MATIC bridge made it sound to me like the biggest benefit comes once PSP arrives on MATIC!

5 Likes

Yesssssssss that’s it

If the proposal is not clear enough: it will enable both PSP on Deversifi L2 + bridging from ETH (both included in the 1.5M vote option) + potentially bridging from/to other EVM chains like Polygon (2M PSP vote option).

Thank you for all the feedback and interest everyone! I have collected a few online & offline questions and attempted to answer below

Now that PSP has been added to the Polygon Network, I suggest we move forward with the 2m PSP option as that will allow PSP to be added to both the DeversiFi <> Ethereum bridge and the DeversiFi <> Polygon bridge. This means PSP can be moved from Polygon to Ethereum very quickly, cheaply and with privacy. I won’t labour the point about how powerful this new flow can be for PSP holders, but a few applications are - arbitrage, achieving privacy with PSP transfers and opening up PSP to new users & smaller users

For anyone who isn’t super familiar with DeversiFi as a project, the core team has been building since 2017 and DeversiFi was launched in June 2020 as one of the first Layer 2 DEXs (before layer 2 was even a thing). The project now numbers 30 people, is well funded and recently launched it’s own community governance via the launch of the DVF token. DeversiFi was the first project to launch on StarkEx and has been working closely with the Starkware team since 2019. We are very excited about their StarkNet launch and have a few things planned there as well - watch this space. Check out the DeversiFi blog or Discord for more information and to get to know us better.

The loan can be recalled at any time and is interest-free. DeversiFi is matching the PSP loan with some of its own ETH reserves to seed the PSP/ETH AMM pool. Timeline - asap!

The DeversiFi team reached out to Mounir and Brice about this proposal to make sure it was something in the interests of both the Paraswap and DeversiFi community before we submitted this proposal

I am excited to make this happen and look forward to your comments

6 Likes

I really read beautiful things :slight_smile:
Thank you

Thank you for all your clear answers, personally all of my doubts have been cleared out. Really looking forward to see where this goes!

1 Like

I can’t agree more. PSP needs to be easily available. We want to reach everyone.

1 Like

lets do this guys ! :partying_face:

Love anything that seeds more liquidity and doesn’t dramatically increase our inflation. More free liquidity IMO, should be a no brainer.

1 Like

Lots of exciting things to come, I support this research / proposal in the making.