From 8057e8fce137cd40ae3f85c90e108642981a1139 Mon Sep 17 00:00:00 2001 From: ozkanonur Date: Fri, 31 Mar 2023 01:08:13 +0300 Subject: [PATCH] initialize nucleus whitepaper Signed-off-by: ozkanonur --- README.md | 1 + WHITEPAPER.md | 349 ++++++++++++++++++++++++++++++++++++++++++++++++++ 2 files changed, 350 insertions(+) create mode 100644 WHITEPAPER.md diff --git a/README.md b/README.md index c550dba..cc8b39a 100644 --- a/README.md +++ b/README.md @@ -56,3 +56,4 @@ Check `init.py` bootstrapping script and update/add any configuration you want. WantedBy=multi-user.target ``` +For further information, see the [whitepaper](./WHITEPAPER.md). diff --git a/WHITEPAPER.md b/WHITEPAPER.md new file mode 100644 index 0000000..e322bfc --- /dev/null +++ b/WHITEPAPER.md @@ -0,0 +1,349 @@ +# Nucleus: Expanding the IBC Interoperability Layer + +- [Abstract](#abstract) +- [Introduction](#introduction) +- [Features](#features) + - [Advanced Cross-Protocol DEX](#advanced-cross-protocol-dex) + - [True Interoperability](#true-interoperability) + - [Keplr Wallet and Authentication Support](#keplr-wallet-and-authentication-support) + - [Innovative Smart Order Routing](#innovative-smart-order-routing) + - [Flexible Staking Options](#flexible-staking-options) + - [Staking and Validator Nodes](#staking-and-validator-nodes) + - [Validator Nodes](#validator-nodes) + - [Delegation](#delegation) + - [Staking](#staking) + - [Unbonding Period](#unbonding-period) + - [Slashing](#slashing) + - [User-Friendly Interface](#user-friendly-interface) + - [Comprehensive Liquidity Solutions](#comprehensive-liquidity-solutions) + - [Versatile Liquidity Multiplier Feature](#versatile-liquidity-multiplier-feature) + - [Robust Security Measures](#robust-security-measures) + - [Incremental Releases and Continuous Improvement](#incremental-releases-and-continuous-improvement) + - [Community-Driven Development](#community-driven-development) + - [Mobile Applications](#mobile-applications) + - [API Access and Integration](#api-access-and-integration) + - [Wallet Integration](#wallet-integration) + - [Comprehensive Documentation and Support](#comprehensive-documentation-and-support) +- [Tokenomics](#tokenomics) + - [Initial Coincap](#initial-coincap) + - [Staking Rewards](#staking-rewards) + - [Community Fund and Strategic Reserve Allocation](#community-fund-and-strategic-reserve-allocation) + - [No Liquidity Mining](#no-liquidity-mining) +- [Governance](#governance) + - [Decentralized Autonomous Organization (DAO)](#decentralized-autonomous-organization-dao) + - [Voting Rights](#voting-rights) + - [Delegation](#delegation-1) + - [Proposal and Voting Mechanism](#proposal-and-voting-mechanism) + - [Timely Execution of Decisions](#timely-execution-of-decisions) +- [Roadmap](#roadmap) + - [Full Planning and Design](#full-planning-and-design) + - [Nucleus Testnet](#nucleus-testnet) + - [Gitbook Documentation](#gitbook-documentation) + - [Keplr Integration](#keplr-integration) + - [Overall optimization and more unit, integration & simulation tests](#overall-optimization-and-more-unit-integration--simulation-tests) + - [Nucleus Mainnet](#nucleus-mainnet) + - [Providing Contribution Guideline](#providing-contribution-guideline) + - [Future Development](#future-development) +- [Conclusion](#conclusion) +- [References](#references) +- [Authors](#authors) + + +# Abstract + +The decentralized finance (DeFi) landscape has experienced explosive growth, with a multitude of blockchain protocols, assets, and applications emerging to capture value and drive innovation. Despite this rapid expansion, a significant challenge remains: the lack of seamless interoperability between the IBC stack / Cosmos ecosystem and other blockchain networks/protocols. Nucleus aims to bridge this gap by providing a cutting-edge IBC solution that enables fluid, secure, and efficient cross-protocol transactions and interactions including but not limited to, atomic swaps, trustless data exchange, and more. The Nucleus network is an innovative project that extends the IBC interoperability stack to the AtomicDEX layer and thus to the wider crypto ecosystem. By providing seamless cross-protocol atomic swaps and other cross-chain atomic transactions (XCAT) between Cosmos (Tendermint) assets and non-Tendermint assets, Nucleus offers unprecedented interoperability between diverse blockchain protocols and ecosystems. This litepaper outlines the key features, tokenomics model, governance, roadmap, and potential obstacles and considerations for the Nucleus project. + + +[TOC] + + + +# Introduction + +The Nucleus interoperability layer is a next generation cutting-edge Inter-Blockchain Communication (IBC) solution developed by [Komodo](https://komodoplatform.com) and leveraging the [AtomicDEX](https://github.com/komodoplatform/atomicdex-api) protocol. This integration facilitates seamless cross-protocol atomic swaps and other XCAT (cross-chain atomic transaction) operations between Cosmos (Tendermint) assets and non-Tendermint assets, such as UTXO blockchains like Bitcoin, Litecoin, DigiByte, Dogecoin, as well as EVM-compatible ledgers including Ethereum, Polygon, BNB Smart Chain, and numerous others to provide this unprecedented level of interoperability. With Nucleus, DeFi developers as well as end-users can enjoy a remarkable level of interoperability between diverse blockchain protocols/ecosystems, while benefiting from the security and reliability of Komodo's advanced technology stack. + + +# Features + + +### Advanced Cross-Protocol DEX: + +Nucleus will provide a superior DeFi swap engine that enables users to seamlessly exchange IBC assets with assets from various other blockchain ecosystems. By supporting an extensive range of protocols, Nucleus aims to complement existing solutions like Osmosis, offering users a more versatile and powerful DEX experience (“dexperience”). + + +### True Interoperability: + +One of the main strengths of Nucleus is its focus on achieving true interoperability outside the IBC stack. As aforementioned, this includes native support for most UTXO blockchains such as Bitcoin, Litecoin, DigiByte, and Dogecoin as well as EVM-compatible ledgers like Ethereum, Polygon, BNB Smart Chain, and many others. Nucleus users will benefit from unparalleled access to diverse blockchain assets and ecosystems. The Nucleus core will support over 500 assets at mainnet launch. + + +### Keplr Wallet and Authentication Support: + +Nucleus will offer seamless integration with the popular Keplr wallet, allowing users to access the platform and manage their assets securely using their Keplr accounts. This integration will provide a user-friendly experience and ensure compatibility with the Cosmos ecosystem, as Keplr is a widely-used wallet within the community. Moreover, Nucleus will leverage Keplr's authentication capabilities to provide a secure and streamlined login process for users. Users will be able to manage their Nucleus coins, delegate to validator nodes, and claim staking rewards with ease via Keplr. + + +### Innovative Smart Order Routing: + +To ensure the best possible swap rates and minimize slippage, Nucleus will implement an innovative smart order routing system that intelligently selects the most favorable trading pairs and liquidity sources. This feature not only optimizes the trading experience for users but also provides a competitive advantage over other platforms. + + +### Flexible Staking Options: + +To encourage user participation and long-term commitment, Nucleus will offer a range of flexible staking options for NUCLEUS coin holders. This includes different lock-up periods, variable reward rates, and the possibility to earn additional rewards through ecosystem-specific incentives. + + +### Staking and Validator Nodes: + +Nucleus will implement a Proof of Stake (PoS) consensus mechanism based on the Cosmos SDK, allowing users to participate in securing the network and earning rewards. To facilitate this, users can delegate their Nucleus coins to validator nodes, which are responsible for proposing new blocks and validating transactions. + + +### Validator Nodes: + +Users with technical expertise and infrastructure can set up validator nodes to participate in the consensus process. Validator nodes are essential for maintaining network security and integrity. In return for their services, validators earn a portion of the block rewards and transaction fees. + + +### Delegation: + +Users who do not wish to run a validator node themselves can as aforementioned delegate their Nucleus coins to an existing validator. This process involves locking up the coins, which helps secure the network and contributes to the overall staking power. Delegators share the rewards earned by the validator node in proportion to their delegated stake. + + +### Staking: + +By enabling staking, Nucleus fosters a secure and decentralized ecosystem where users can contribute to the network's propagation and earn rewards for their participation. This comprehensive staking feature set is designed to encourage community involvement, promote network security, and offer users a seamless experience when interacting with the Nucleus platform. Both validator nodes and delegators will receive staking rewards, which are distributed as Nucleus coins. The rewards are designed to incentivize users to participate in securing the network and maintaining its stability. + + +### Unbonding Period: + +To discourage abrupt network disruptions, an unbonding period (~28 days) will be implemented for users who wish to withdraw their delegated coins. During this period, the delegated coins will be in a locked state and ineligible for staking rewards. The unbonding period helps maintain network stability by preventing sudden, large-scale withdrawals of staked coins. + + +### Slashing: + +To ensure validators are acting in the best interest of the network, a slashing mechanism will be in place to penalize malicious or negligent behavior. Validators who fail to properly validate transactions or attempt to compromise the network can have a portion of their staked coins slashed, which serves as a strong deterrent against bad actors. + + +### User-Friendly Interface: + +Nucleus will prioritize user experience by developing a user-friendly interface that caters to both beginners and experienced traders alike. + + +### Comprehensive Liquidity Solutions: + +To ensure optimal liquidity for supported assets, Nucleus will implement various liquidity solutions, integrate with external liquidity providers, and provide incentives for users who contribute liquidity. By providing deep and diverse liquidity sources, Nucleus aims to offer a seamless and efficient trading experience for all users. + + +### Versatile Liquidity Multiplier Feature: + +Nucleus introduces an innovative liquidity multiplier feature that allows users to maximize the utility of their holdings by enabling them to create orders for multiple trading pairs using the same asset. This unique approach allows users to effectively allocate their funds across various trading pairs without the need to hold a separate balance for each pair. + +For example, if a user has 1 ATOM, they can create limit orders for 1 ATOM against LTC, 1 ATOM against DOGE, and so on, without needing to hold additional ATOM for each trading pair. This mechanism allows the same funds to be utilized across different pairs, thus optimizing the use of available liquidity. + +By providing this versatile liquidity multiplier feature, Nucleus aims to offer a seamless and efficient trading experience for all users. This approach not only enhances the depth of the order book but also has the potential to reflect thousands or even millions of ATOM in orders, assuming there are enough trading pairs available. This innovation makes the Nucleus platform highly attractive for traders and investors looking to optimize their trading strategies across a wide range of assets. + + +### Robust Security Measures: + +Security will be a top priority for Nucleus, with a commitment to implementing best practices, rigorous audits, and regular updates to ensure the platform remains secure and trustworthy. Users can have confidence in the safety of their assets and transactions on the Nucleus platform. + + +### Incremental Releases and Continuous Improvement: + +Nucleus will adopt an iterative development approach, with planned incremental releases to deliver new features, enhancements, and refinements over time. This strategy ensures continuous improvement of the platform and allows the project to adapt to the ever-evolving DeFi landscape. + + +### Community-Driven Development: + +Nucleus will foster a strong, engaged community by actively involving its members in the development process. This includes soliciting feedback, conducting polls, and incorporating user suggestions to drive the platform's ongoing evolution and success. + + +### Mobile Applications: + +To ensure that users have access to the Nucleus platform anytime, anywhere, dedicated mobile applications will be developed for both Android and iOS devices. These apps will feature an intuitive user interface, responsive design, and a full range of trading and staking functionalities, making it easy for users to manage their assets on the go. + + +### API Access and Integration: + +Nucleus will provide a comprehensive API for developers and third-party applications to easily integrate with the platform. This will enable a wide range of services, tools, and dApps to leverage the power of Nucleus's cross-protocol DEX, extending its reach and utility across the wider blockchain ecosystem. + + +### Wallet Integration: + +Nucleus will support integration with major wallet providers, such as Keplr, MetaMask, Trust Wallet, Trezor, AtomicDEX/Komodo Wallet, and Ledger, to ensure seamless and secure asset management for its users. The platform will also strive to add support for other popular wallets over time, catering to the preferences of its diverse user base. + + +### Comprehensive Documentation and Support: + +To help users and developers understand and utilize the Nucleus platform effectively, the project will provide extensive documentation, tutorials, and support resources. This includes GitBook documentation, in-app help, and a dedicated support team to assist users with any questions or issues they may encounter. + +By combining these advanced features, Nucleus aims to position itself as a leading cross-protocol DEX that offers a superior alternative to existing solutions like Osmosis. The platform's focus on true interoperability, advanced trading capabilities, user experience, and community-driven development will make Nucleus a compelling choice for DeFi users seeking a versatile and future-proof solution that caters to the ever-evolving blockchain ecosystem. + + +# Tokenomics + +The Nucleus project will introduce the NUCLEUS coin to facilitate various aspects of the platform, including staking, governance, and ecosystem support. A carefully designed tokenomics model ensures long-term stability and growth of the Nucleus ecosystem. + + +### Initial Coincap: + +Nucleus will have an initial pre-mine of 100 million (100,000,000) NUCLEUS coins, distributed as follows: + +**50% Airdrop:** + +30% to ATOM holders + +10% to KMD holders + +10% to Osmosis holders + +**30% Strategic Fund:** Reserved for project development, marketing, partnerships, and other strategic initiatives. + +**20% Community Fund:** DAO-governed fund managed by NUCLEUS coin holders for community-driven proposals, grants, and ecosystem development. + + +### Staking Rewards: + +NUCLEUS coin holders will be incentivized to stake their coins to secure the network and participate in governance. + +Staking rewards will start at 20% p.a. in the first year, decreasing by 50% each subsequent year: + +10% in Year 2 + +5% in Year 3 + +2.5% in Year 4 + +1.25% in Year 5, and so on + + +### Community Fund and Strategic Reserve Allocation: + +A portion of the staking rewards will be allocated to the community fund and the strategic reserve to support the ongoing development, marketing, and ecosystem growth. + +In the first year, 20% of staking rewards will be allocated to the community fund and 10% to the strategic reserve. + +The allocation rate will drop by 50% in the following years until it reaches 1%: + +10% and 5% respectively, in Year 2 + +5% and 2.5% in Year 3, + +and so on + + +### Governance Incentives: + +NUCLEUS coin holders will have voting rights in the platform's DAO, empowering them to influence the project's direction and make critical decisions. + + +### No Liquidity Mining: + +To ensure a stable and sustainable tokenomics model, Nucleus will not implement liquidity mining, avoiding the creation of a potential Ponzi-like scheme. + +The Nucleus tokenomics model is designed to balance various factors, such as incentivizing users to stake, participate in governance, and contribute to the ecosystem's growth while maintaining a sustainable long-term economic model towards a deflationary system. Through a combination of strategic allocations, staking rewards, and carefully planned coin distribution, Nucleus aims to create a thriving and sustainable ecosystem that will benefit both the project and its users. + + +# Governance + +Governance plays a crucial role in the Nucleus ecosystem, allowing NUCLEUS coin holders to participate in the decision-making process, driving the project's direction, and ensuring a decentralized, community-centric, and transparent approach to platform management. + + +### Decentralized Autonomous Organization (DAO): + +Nucleus will implement a DAO structure to empower its community of coin holders, enabling them to propose, discuss, and vote on various aspects of the project, such as protocol upgrades, ecosystem development initiatives, and resource allocation. + + +### Voting Rights: + +NUCLEUS coin holders will have voting rights proportional to their coin holdings. This structure encourages active participation in the platform's governance while ensuring that the interests of coin holders are represented fairly. + + +### Delegation: + +To foster a more inclusive governance process, Nucleus will support delegation, allowing coin holders to delegate their voting rights to other community members or trusted representatives. This feature ensures that coin holders who may not have the time or expertise to actively participate in governance can still have a say in the project's direction. + + +### KMD Allocation and Voting Rights: + +Nucleus governance will optionally (Komodo community vote/poll required) also be used for actual Komodo Platform governance by granting the KMD allocation portion a special/additional KMD-specific voting right. This approach ensures that the Komodo ecosystem can benefit from this native Cosmos SDK capability. The KMD portion airdrop allocation becomes “de-facto locked” since transaction hops (= “as soon as funds move”) remove KMD governance eligibility - exemptions exist for special transactions such as delegations, et cetera. + + +### Proposal and Voting Mechanism: + +The Nucleus governance system will implement a proposal and voting mechanism to facilitate decision-making. Community members can submit proposals for consideration by the NUCLEUS coin holders. Proposals can cover various aspects, such as new features, enhancements, bug fixes, or strategic partnerships. Token holders can then discuss, evaluate, and vote on the proposals, with the outcome determined by the majority. This process ensures that the community's collective wisdom and expertise drive the project's development and success. + + +### Transparent Governance: + +To ensure “trust” and maintain a high level of transparency, all governance activities, including proposals, discussions, and voting results, will be publicly accessible. This approach allows the community to monitor and evaluate the decision-making process, fostering accountability and responsibility among coin holders and project contributors. + + +### Timely Execution of Decisions: + +To maintain momentum and ensure continuous progress, Nucleus will implement a system for the timely execution of decisions made through the governance process. This includes deploying approved protocol updates, allocating resources for ecosystem development, and initiating partnerships or collaborations based on the community's consensus. + +By incorporating a comprehensive governance system, Nucleus aims to create a truly decentralized and community-driven project that encourages active participation, fosters innovation, and ensures continuous growth and development. + + +# Roadmap + +In order to provide a clear and concise overview of the development process for the Nucleus platform, we have outlined a clear roadmap that highlights key milestones and objectives. This roadmap serves as our strategic blueprint, ensuring that our team remains focused and committed to delivering a secure, user-friendly, and cutting-edge DeFi experience to the community. By following this roadmap, we aim to establish Nucleus as a leading force in the blockchain ecosystem, setting new standards in interoperability, liquidity, and innovation. + + +### Full Planning and Design: + +The Nucleus team began by thoroughly planning and designing the platform, outlining its features, and creating a solid foundation for future development. + + +### Nucleus Testnet: + +The team successfully launched the Nucleus Testnet during Q1 2023, which is currently running and features full IBC compatibility and atomic swap capability, showcasing the platform's interoperability and versatility. + + +### GitBook Documentation: + +Comprehensive and technical documentation will be provided through GitBook to help users and developers understand the platform and its features. + + +### Keplr Integration: + +The Nucleus team is working on integrating Keplr login support, allowing users to securely access the platform using their Keplr wallets, streamlining the user experience, and enhancing platform security. + + +### Overall optimization and more unit, integration & simulation tests: + +To ensure the Nuclenus node runs smoothly, before publishing the mainnet, we will prioritize optimization by re-checking our implemented algorithms, minimizing resource usage, optimizing networking protocols, and hardware acceleration options. We also plan to increase the number and quality of unit, integration, and simulation tests by identifying critical areas that lack coverage, automating their execution, and using mock objects to isolate components during integration tests. These measures will help us catch bugs early, ensure quality, and improve the platform's performance and user experience to provide best node possible for mainnet. + + +### Nucleus Mainnet: + +Following the successful testnet phase and Keplr integration, Nucleus will launch the Mainnet, making the platform fully operational and accessible to users for trading, staking, and other DeFi activities. + +### Providing Contribution Guideline: + +We welcome contributions from anyone who wants to improve it. To ensure smooth collaboration, we will provide clear guidelines for contributing code, reporting issues, and suggesting improvements. Our guidelines will cover topics such as coding standards, documentation, issue triage, and code review processes. By providing a clear path for contributors to follow, we hope to encourage a vibrant community of developers to help us improve the Nucleus. + + +### Future Development: + +Nucleus will continue to be developed in phases, with plans to expand support for additional blockchain protocols, create a mobile app for convenient on-the-go access, and enhance the governance layer to promote community involvement and platform growth. + + +# Conclusion + +Nucleus is poised to revolutionize the DeFi space and expands the interoperability stack of the Inter-Blockchain Communication (IBC) layer. By bridging the gap between Cosmos/ATOM assets and non-Tendermint assets, Nucleus delivers a unique and powerful solution for cross-protocol atomic swaps and cross-protocol/chain atomic transactions. + +Leveraging the expertise of the Komodo team, Nucleus will offer a secure, reliable, and robust platform that aims to create a more interconnected blockchain ecosystem. With a focus on community-driven governance, Nucleus is designed to be adaptable and responsive to the needs of its user base. + +While there are potential obstacles to consider, such as market factors, legal landscape/regulation, or marketing challenges, Nucleus's ability to drive user growth, increase market visibility, and strengthen both the Komodo and Cosmos/IBC ecosystem ultimately outweighs these concerns. As the project develops, Nucleus will continue to expand its functionality, offering a comprehensive and forward-looking solution for DeFi developers and users alike. + +Through the integration of cutting-edge technologies and an unwavering commitment to innovation, Nucleus is set to become a leading force in the IBC Cosmoverse, providing unparalleled levels of interoperability and cross-chain compatibility for the DeFi landscape. + + +# References + +[1] + +# Authors + +- Kadan Stadelmann [ca333@komodoplatform.com](mailto:ca333@komodoplatform.com) +- Onur Özkan [onur@komodoplatform.com](mailto:onur@komodoplatform.com) +- [ChatGPT (GPT-4)](https://chat.openai.com/chat?model=gpt-4)