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QuidMint

10 stablecoins in a Uniswap basket pooled with ETH in AAVE, fees driven by de-peg predictions

Prediction Markets DeFi & Tokenization Risk & Compliance

What it is

Since there's been a major USDC de-peg in the past, it's concerning that Uniswap's most popular pool in terms of volume is USDC <> WETH.
The problem that QuidMint solves is bootstrapping a new pool (on top of UniV4) by using the existing pool I mentioned as a sort of springboard.

However, the USDC side is actually a bundle of the top 10 stablecoins: they all get staked natively into their respective protocol's vaults,
only USDC goes into an RWA vault (Hashnote) and USDT goes into AAVE (as well as all of the ETH)!

Swapping out a specific stablecoin from the basket (rather than each one pro rata) carries a fee which depends on
participants' collective expression of de-peg probability, measured by bets in a custom prediction market linked to the basket.

How it Works

Prediction markets are usually binary: yes or no.
This one has multiple sides (for each coin that can de-peg).

The formula that prices taking a side considers both
aggregate demand and demand for that specific side.
Most importantly, from a math standpoint, we get a
probabilistic signal from the bets themselves, as they contain
a confidence parameter separate from the bet amount
(it functions like leverage without liquidation risk).

The cold start problem is solved with a bonds mechanism
(see Basket.sol mint function) which incentivizes deposits, and
also allows LPing directly with ETH, without selling half of it for $.

UMA votes on whether nothing happened, or if there was a depeg.
The Chainlink CRE has to confirm this vote evidently, and if there is
a dispute then the basket's own native Court & Jury mechanism hits.

The UX problems of commit-reveal, claiming payouts, and position
duration extension are solved by delegating authority to a keeper...

The price range and fee compounding of Uniswap is automated
without requiring a keeper. The only other thing the keeper does
on Ethereum is a momentum trading strategy through AAVEv3
(there's also a function for migrating to AAVEv4 when it's live).

Links

Created by

  • Richard Tiutiun