eBTC Fee Recipient Module

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eBTC Fee Recipient Module

Team Introduction

Lead Developer Pavel Fedotov

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Professional Background: Pavel is a Full Stack Blockchain Developer with over four years of experience in engineering decentralized applications using cutting-edge technologies such as Rust, Solidity, Python, JavaScript, TypeScript, React, and Next.js.

Key Achievements:

Pin Save: Successfully completed the Filecoin grant aimed at advancing decentralized Identity standards (ERC-725) integrated with NFT frameworks. Notably, Pin Save secured a RetroPGF grant from the Optimism Foundation with 25 votes.

Academic Background: Holds a BA in Business Studies and Economics from the University of Manchester, graduating with Honours. Pavel also published a highly regarded academic article titled “Critical Analysis of the Electric Vehicle Industry: Five Forces and Strategic Action Fields” which garnered over 50,000 downloads.

Governance Expertise: Demonstrated involvement in governance with approximately 20 million ARB tokens delegated in two committee elections on Arbitrum: Arbitrum Procurement Committee and Arbitrum Research & Development.

Speaking Engagements: Pavel has presented at notable events such as ETH Belgrade 2024, IPFS Camp 2024, ETH Bucharest 2024, and Web3 Family Conference.

Data Science Contributions: His notable data science achievements in the web3 space include: Lifetime Gitcoin Grants Data Analysis and Hypothesis Testing report, Insights into Filecoin Storage Network Energy Consumption and Ethereum Security Data Collection Ideas.

I am also very proud to recieve and still hold 10 Badger recieved through gitcoin bounty in 2021.

Project Overview

Brief Description of the Project

eBTC Fee Recipient Module is an innovative initiative designed to enhance the sustainability and liquidity of the eBTC ecosystem by creating a systematic approach for processing and redirecting fees generated from transactions within the platform. This module will automatically convert a specified percentage of transaction fees into eBTC, which can then be allocated to community-defined initiatives, such as supporting the steBTC treasury or reinvesting into liquidity pools.

How It Aligns with Badger DAO’s Objectives

eBTC Fee Recipient Module aims to create a continuous revenue stream that not only enhances liquidity but also promotes community involvement by demonstrating how fees are utilized for collective benefits. This module seeks to:

  • Increase eBTC Liquidity: By regularly injecting converted fees back into the market, the module will help stabilize and potentially increase the value of eBTC.
  • Foster Community Engagement: Users will be encouraged to participate actively in the eBTC ecosystem, knowing that their engagement leads to direct monetary benefits for the community.
  • Establish a Clear Revenue Model: This initiative will create a reliable mechanism for utilizing fees effectively, ensuring the eBTC ecosystem’s long-term sustainability.

Detailed Project Description: eBTC Fee Recipient Module

In-Depth Explanation of the Project

eBTC Fee Recipient Module is designed to address the critical aspects of revenue generation and community engagement within the eBTC ecosystem. The primary goal of this initiative is to create a systematic method for utilizing transaction fees generated from the platform in a way that benefits the eBTC community as a whole.

Key Components of the Module:

  1. Fee Processing Mechanism:

    • The module will be responsible for collecting transaction fees generated within the eBTC ecosystem. These fees can come from various activities such as borrowing, trading, and transactions involving eBTC.

  2. Automated Conversion:

    • A specified percentage of the collected fees will be automatically converted into eBTC. This conversion creates a consistent influx of liquidity directly into the eBTC supply and helps maintain stability in its market value.

  3. Community Allocation:

    • Once fees are converted into eBTC, they can be allocated to community-defined initiatives. These initiatives may include:
      • Supporting the steBTC treasury.
      • Funding community projects that enhance the ecosystem’s usability and value.
      • Reinvesting in liquidity pools to ensure adequate liquidity supply.

  4. Impact Transparency:

    • The module will provide transparent reporting to the community regarding how fees are collected and allocated. This transparency fosters trust and demonstrates accountability within the eBTC ecosystem.

  5. Incentives for Participation:

    • Users will be encouraged to participate actively in the ecosystem as they will be able to witness the collective benefits of their engagement through the redistribution of fees.

Technical Details and Architecture

1. Architecture Overview:

  • The fee recipient module will be integrated with existing smart contracts within the eBTC ecosystem to ensure seamless operation and ease of use.

2. Smart Contract Development:

  • Smart Contracts:
    • Develop smart contracts that define the parameters for fee collection (e.g., percentage rates for conversion) and the mechanisms for automated conversion and redistribution of fees.
    • The smart contracts will ensure that all transactions are secure, verifiable, and tamper-proof.

3. Backend Processing:

  • Oracle Integration:
    • Utilize oracles for real-time price feeds of eBTC, facilitating accurate conversions from collected fees to eBTC.
  • Data Storage:
    • Implement a secure database for storing records of transactions, fees collected, and eBTC converted. This will support reporting and transparency features.

4. User Interface Integration:

  • Dashboard for Users:
    • Create a user-friendly dashboard that displays real-time data on fees collected, amounts converted into eBTC, and ongoing community initiatives funded by the module.
    • The dashboard will allow users to track how their engagement contributes to overall ecosystem health and liquidity.

Conclusion

eBTC Fee Recipient Module represents a critical step toward enhancing liquidity and ensuring sustainable growth within the eBTC ecosystem. By integrating this module, the project not only promotes community engagement and trust but also establishes a robust financial structure that will benefit all stakeholders involved.

With the combination of automated processes, transparency in fee allocation, and community-focused initiatives, this project aligns seamlessly with the broader objectives of Badger DAO, ensuring the continued success and usage of eBTC within the decentralized finance landscape.

Roadmap and Milestones for eBTC Fee Recipient Module

Phase 1: Planning and Requirements Gathering (Weeks 1-2)

  • Milestone 1.1: Kickoff Meeting

    • Conduct a project kickoff meeting with stakeholders to outline goals and expectations.
    • Deliverable: Project charter document outlining goals, objectives, and key stakeholders.

  • Milestone 1.2: Requirement Specification Document

    • Finalize technical requirements and specifications for the fee recipient module.
    • Deliverable: Requirement Specification Document approved by stakeholders.

Phase 2: Development and Initial Testing (Weeks 3-8)

  • Milestone 2.1: Smart Contract Development

    • Develop and conduct initial testing of the smart contracts responsible for fee collection and conversion.
    • Deliverable: Completed smart contracts ready for audit.

  • Milestone 2.2: Backend Development

    • Implement the backend systems that will handle fee processing and database management.
    • Deliverable: Fully functional backend system integrated with oracles for real-time data.

  • Milestone 2.3: User Interface Design and Development

    • Design and build a user-friendly dashboard for users to view their transactions.
    • Deliverable: Functional user interface seamlessly integrated with backend and smart contracts.

Phase 3: Comprehensive Testing and User Acceptance (Weeks 9-12)

  • Milestone 3.1: Unit and Integration Testing

    • Conduct rigorous unit tests on smart contracts and integration tests for the entire system.
    • Deliverable: Completed test reports showing coverage, performance, and security.

  • Milestone 3.2: User Acceptance Testing (UAT)

    • Engage a select group of users to test the module and gather feedback.
    • Deliverable: UAT feedback report addressing issues and suggested improvements.

  • Milestone 3.3: Deployment

    • Finalize deployment of the fee recipient module to the mainnet.
    • Deliverable: Live deployment and confirmation of successful transactions.

Phase 4: Launch and Initial Monitoring (Weeks 13-16)

  • Milestone 4.1: Community Announcement

    • Announce the launch of the module through various communication channels.
    • Deliverable: Launch announcement and user education materials.

  • Milestone 4.2: Monitoring Performance Metrics

    • Establish tools to track module performance and gather initial user data.
    • Deliverable: Performance monitoring dashboard with key metrics.

  • Milestone 4.3: Feedback Collection

    • Begin collecting user feedback for ongoing improvements.
    • Deliverable: Initial feedback report summarizing user experience and suggestions.

Budget Breakdown
Phase 1: Planning and Requirements Gathering $3,500
Phase 2: Development and Initial Testing $22,000
Phase 3: Comprehensive Testing and User Acceptance $6,000
Phase 4: Launch and Initial Monitoring $4,000

Expected Impact of the eBTC Fee Recipient Module

1. Increased Liquidity in the eBTC Market

  • Description: By automating the conversion of transaction fees into eBTC and reinvesting them into the liquidity pools, the module is expected to enhance market liquidity significantly. This will facilitate smoother trades and reduce volatility, contributing to a more stable price for eBTC.
  • Measurement: Target a 20% increase in eBTC trading volume within the first quarter post-launch.

2. Enhanced Community Engagement

  • Description: The fee recipient module will foster a sense of community by transparently demonstrating how fees are collected and utilized. Users will feel more connected to the ecosystem when they see the direct impact of their activities in supporting community initiatives.
  • Measurement: Aim for a 30% increase in active users within the eBTC ecosystem and engagement metrics (like participation in forums, feedback submission, etc.) within 6 months of implementation.

3. Sustainable Revenue Model

  • Description: With a systematic approach to fee management, the eBTC ecosystem will have a reliable revenue stream dedicated to community initiatives, further enhancing the ecosystem’s sustainability and growth potential. This will also allow for funding new projects and developments within the platform.
  • Measurement: Establish clear metrics to monitor incoming fees and conversions, targeting $10,000 in funds allocated to initiatives within the first year of operation.

4. Strengthened Trust and Accountability

  • Description: By providing transparent reporting on fee collection, conversion, and how funds are utilized, the module will enhance user trust. Users can access data on how their interactions contribute to broader ecosystem goals, fostering accountability within the platform.
  • Measurement: Conduct quarterly community surveys to gauge trust levels and overall satisfaction, aiming for an 85% positive feedback rating on community trust and transparency.

5. Support for Community-Driven Initiatives

  • Description: The ability to direct converted fees towards community projects will empower users to propose and vote on initiatives that enhance the eBTC ecosystem. This democratic approach encourages innovation and meets the evolving needs of the community.
  • Measurement: Facilitate the funding of at least 3 community initiatives within the first year, promoting diversity in contributions and encouraging participation from a broader range of users.

Risks and Mitigation Strategies for eBTC Fee Recipient Module

1. Smart Contract Vulnerabilities

  • Risk: Smart contracts are susceptible to bugs and vulnerabilities that can be exploited, potentially leading to financial losses or breaches of trust in the platform.
  • Mitigation Strategy:
    • Thorough Auditing: Employ a reputable third-party auditing firm to review smart contracts before deployment to ensure security and functionality.
    • Testing Suite: Develop comprehensive unit and integration tests during the development phase to identify issues early in the process. Implement a bug bounty program to encourage community members to report vulnerabilities.

2. Regulatory Risks

  • Risk: Changes in regulatory frameworks concerning cryptocurrencies could impact the operations of the eBTC Fee Recipient Module, including compliance requirements and potential liabilities.
  • Mitigation Strategy:
    • Legal Consultation: Engage legal experts familiar with cryptocurrency regulations to ensure compliance with current laws and to prepare for potential changes in regulations.
    • Flexible Framework: Design the module to be adaptable, with the capability to incorporate changes quickly if regulatory conditions shift.

3. Low User Adoption

  • Risk: The success of the fee recipient module relies heavily on user adoption and engagement. There is a risk that users may not embrace the new features or understand the benefits.
  • Mitigation Strategy:
    • User Education: Launch educational campaigns, including webinars, tutorials, and detailed documentation, to inform users about how the module works and the benefits of participation.
    • Incentives for Early Adoption: Provide incentives such as bonus BADGER tokens for users who actively engage with the new features during the initial implementation phase.

4. System Performance and Downtime

  • Risk: Technical issues, including server outages or performance bottlenecks, could lead to decreased availability of the module, impacting users’ ability to transact and affecting liquidity.
  • Mitigation Strategy:
    • Robust Infrastructure: Utilize reliable cloud service providers and implement load balancing to handle traffic efficiently.
    • Monitoring Tools: Set up real-time monitoring and alerting systems to detect and resolve performance issues proactively.

5. Market Volatility Impacting Fee Revenue

  • Risk: High volatility in the cryptocurrency market could lead to fluctuations in fee revenue, impacting the sustainability and cash flow of the project.
  • Mitigation Strategy:
    • Dynamic Fee Structure: Implement a dynamic fee structure that adjusts based on market conditions, helping stabilize revenue streams.
    • Diversification of Utilization: Explore multiple avenues for reallocating fees to various liquidity pools or community projects to ensure flexibility in fund utilization.

6. Community Discontent or Disengagement

  • Risk: If users feel that the fee usage is not beneficial or their voices are not heard, community morale and engagement could decrease.
  • Mitigation Strategy:
    • Regular Feedback Loops: Establish a structured process for collecting regular feedback from users about their experiences and any concerns related to the module.
    • Transparency and Reporting: Provide regular updates and transparent reporting on how fees are being allocated and the results of funded initiatives, reinforcing community trust and involvement.
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