Profit Pools Spec [WIP]

Taker Considerations

• How to efficiently aggregate liquidity across the different pools (infinite loop problem)
• It would suck if you have to approve to every single ProfitPool. Or need to send funds to every profit pool. It's a for loop of transfers
• Initially, there can be a low variety of ProfitPool spreads for few markets (e.g. 1% and 0.5%)
• However, there should be discovery of these markets. (Maybe only allow 20 basis point increments to limit queue size)
• Should be cheap & easy to calculate / derive blended cost and single source of approvals for all pairs. Starting to think that the factory should own approvals all the state.
• Oracle + Pair -> Spread (Usually oracles work only for a specific pair)

Properties

• Use the price feed / oracle you trust (as long as ETH/token pair)
• Tokenized and pooled positions of the same pair / spread
• Activity-based yield with defined requirements

Risks

• Oracle corruption
• Market / Oracle lag time

Smart Contracts

• ProfitPool: Smart contract with a defined token pair and spread requirements. Lower spreads should result in more activity. Higher spreads means lower activity
• ProfitPoolFactory: Used to add ProfitPools of new spread requirements. Each profit pool factory is linked to a certain oracle. Arbitrary token pairs don't really matter

ProfitPoolFactory

Design

• LinkedList to track spread tokens
• Stores balances of ProfitPools
• Serves as source of approval and transfers

State

• oracle
• tokenA
• tokenB
• spread -> address

State

ProfitPool.sol is ERC20

State

• tokenA
• tokenB
• spread
• AToBOracle

Functions

constructor(tokenA, tokenB, spread, oracleAddress)

Sets the above

deposit(uint256 quantity) payable external

Deposits the specified pool token quantities of the specified quantity and generates a token based on the contribution.

withdraw(uint256 quantity) payable external

Burns the representative token and withdraws the current available mix.

use(address token, uint256 quantity)

• Calls an external function smart contract that retrieves the quantity of tokens
• Validates that the required spread is made - based on the oraclePrice

tokenAQuantity() public view returns(uint256)

tokenBQuantity() public view returns(uint256)