Final ZIP-3: Proposing the zerozero DEX - Governance Proposal

Abstract

This document proposes the zerozero Decentralized Exchange (DEX) to the zerozero DAO as a new tool to help the zerozero ecosystem grow.

The zerozero DEX is a set of smart contracts forked from the Uniswap V2 architecture that will allow anyone to buy and sell creator tokens.

The zerozero DAO acts as an administrator for the zerozero DEX. The various aspects of the DEX are governed by the DAO and can be managed via votes from the zerozero community.

Motivation

The motivation behind this proposal is to propose to the zerozero DAO a relevant tool to create a secondary market for creator tokens.

Creator tokens are earned for free in a number of ways on p00ls.io , which constitutes the primary source of supply in the market. For community members looking to acquire tokens outside of such events earning events, or that want to get rid of their tokens, there is currently no tool allowing them to do so.

The zerozero DEX will facilitate transactions on creator tokens in an automated fashion and allow creator tokens to become liquid and viable currencies of their respective ecosystems.

Rationale

The zerozero ecosystem is composed of many elements including creators, creator communities, the zerozero DAO etc. These communities are united through the relevant creator token but are not fixed: they can grow and diminish for any number of reasons.

In order for the zerozero ecosystem to thrive and foster an active community, there needs to be a set of tools to allow for dynamic communities. These include distribution tools for fans to earn tokens from their favorite artist or token-gated experiences to reward fans for their engagement. This list of tools will only get longer as projects emerge from the community to enhance this ecosystem. One of the tools we believe is needed for the zerozero ecosystem is this marketplace, the zerozero DEX, to allow for anyone to transact creator tokens in an automated fashion.

Specifications

General Structure

The zerozero DEX is an automated market-maker forked from the Uniswap V2 infrastructure, the gold standard for automated market making in DeFi. Creator coins in the form of ERC-20 tokens will be listed on the zerozero DEX to be traded against the $00 token.

The zerozero DAO will vote to list creator coins on the zerozero DEX and host an auction for a coin. After token minting, an initial auction will be held on the zerozero DEX. This process works as follows :

  • A set amount of creator tokens is allocated to the initial auction
  • Half of this amount is auctioned during a fixed amount of time
  • The proceeds of the auction are paired with the remaining half of the creator token amount
  • A liquidity pool is created on the DEX with both of these tokens

There will be only $00/$CREA liquidity pools on the zerozero DEX at first, meaning funds will be raised in $00 during the auction.

Once the token is listed on the zerozero DEX, the price for a given creator token will be determined directly by the liquidity in its pool through the constant product formula.

If x is the supply of creator coin ($CREA) in the pool and y is the supply of the paired coin ($00) in the pool, the price of the creator token in $00 is given as the quotient of y and x.

These liquidity pools will allow anyone to swap in and out of any creator token to join their selected communities and gain access to the creator’s world.

More information about the zerozero DEX can be found here.

Launch

In order to launch the zerozero DEX in a meaningful way, there needs to be liquidity pools on it. We believe that it would be beneficial to launch the zerozero DEX along with 4 creators token pools on it, namely the following 4 pairs :

  • $FEVER, the token of Aluna paired with $00 : $FEVER / $00
  • $NIKITA, the token of Hugo Comte paired with $00 : $NIKITA / $00
  • $STEELO, the token of Steelo paired with $00 : $STEELO / $00
  • $HEART, the token of the Hearts NFT Collection paired with $00 : $HEART / $00

Steps to Implement

  • Deploy the smart contracts on chain
  • Launch the relevant interfaces online (Swap portal, Stats portal)
  • Launch the 4 auctions

Timeline

Solution prepared and ready to be ratified

Overall Cost

No cost to implement

2 Likes