Litepaper
We’re excited to release the official Poppy Finance litepaper. This article will explain the full vision of Poppy, a non-custodial yield optimizer built to help anchor the explosion of Cardano DeFi.
Contents
- Abstract
- Introduction
- Protocol Objectives
- Technical Approach
- Contributors
- POP Tokenomics
- POP Utility
- Roadmap
- Final Remarks
1. Abstract
Poppy Finance is a next generation yield optimizer built on the Cardano blockchain.
As decentralized finance gains popularity, Poppy Finance aims to provide Cardano users with a secure and efficient platform to maximize their yield-generating opportunities.
Leveraging the innovative features of Cardano’s UTxO model, Poppy Finance enables users to optimize their yield farming strategies, earn passive income, and participate in our vibrant community-driven ecosystem.
It is our hope that this platform, the first of its kind on Cardano, can help foster the explosion of Cardano DeFi.
2. Introduction
With the rapid growth of DeFi, yield optimization platforms have become essential tools for investors seeking to maximize their returns on digital assets.
Poppy Finance stands at the forefront of this revolution on the Cardano blockchain, offering a suite of robust yet user-friendly tools.
Using Poppy Finance, any Cardano user will be able to optimize their earning capacity in a consolidated and sleek platform, without the hassle of manually monitoring all their DeFi activity across different procotols.
Poppy Finance is scheduled to launch on Cardano mainnet July 2023 with a brief testnet in late June.
To incentivize the long-term use of the Poppy Finance protocol, there will be highly-attractive rewards to users, which should drive TVL on our platform and ultimately result in increased revenue for our project.
We are confident that our strategy of incorporating highly-attractive rewards in an organized and consolidated DeFi environment will position Poppy to be market leader in Cardano yield optimizers.
Below is a description of the design, features, roadmap, and contributors of Poppy Finance.
3. Protocol Objectives
Our protocol objectives are:
- Maximize Yield Generation by employing sophisticated algorithms and strategies to identify and capitalize on the most profitable opportunities in the Cardano ecosystem.
- Minimize Risk Exposure by implementing robust risk management mechanisms, such as diversification, risk assessment models, and automated monitoring systems.
- Contribute to Cardano’s DeFi explosion by seamlessly displaying and offering the best yield generating opportunities on Cardano.
Technical Approach
The Poppy Protocol
The primary objective of the protocol is to construct customized vaults for each external DEX pool by deploying parameterized vault contracts and minting policies. These vault contracts serve as a direct interface to the liquidity pools offered by external decentralized exchange (DEX) providers. Their purpose is to effectively manage user interactions involving fund deposits and withdrawals.
When a user deposits LP tokens into the vault, they will be issued cornTokens, which represent the deposited LP token value. Subsequently, when a user intends to withdraw LP tokens from the vault, they must burn the corresponding cornTokens using the minting policy to receive their LP tokens, along with any associated rewards.
To ensure smooth operations and prevent concurrency issues, the protocol will also implement a custom linked list architecture. This architecture allows users to interact with the contract without adversely affecting or stalling the protocol.
Additionally, each vault will accumulate rewards from the external DEX pools.
However, considering the locking periods of certain DEX pools, the protocol will utilize defined locking and withdrawal periods. For instance, some DEXs may have a locking period of 30 days. This implies that every 30 days, the protocol will compound the accrued interest or rewards from these pools.
5. Contributors
Our team philosophy stems from the fundamental belief that Cardano is the most secure and decentralized blockchain in existence.
The Poppy protocol has attained the services of Anastasia Labs and Saturn Labs, two renowned teams of global contributors that are committed to the success of our protocol. These teams have been involved in some of the most well-known projects on Cardano. Together, we believe these teams possess the development and marketing prowess to make Poppy a successful project.
6. POP Tokenomics
POP is the platform token for the Poppy Finance protocol.
There is a total of 100 million (100,000,000) POP tokens.
A detailed explanation of POP tokenomics will be released in the near future.
Opportunities to earn POP tokens will be available prior to our mainnet launch.
7. POP Utility
The POP token utility is straightforward and designed to provide value to supporters and users of the protocol. This will be done through these two primary methods: revenue sharing and governance.
Revenue Sharing
The Poppy Finance protocol earns revenue by applying a percentage fee to the harvest rewards from all Poppy vaults.
Out of this revenue:
- 50% is distributed directly to POP stakers.
- 25% will be converted to POP and provide liquidity to the POP/ADA pair.
- 25% will be converted to ADA and provide liquidity to the POP/ADA pair.
This model will ensure half of our revenue is shared directly with POP stakers, while the other half is used to deepen the liquidity of the POP/ADA pair.
At launch, the platform will support two revenue sharing vaults. An ADA vault, where POP stakers will be able to claim their portion of the protocol revenue from the Rewards Vault smart contract in the form of ADA; and the POP Maxi vault, where the portion of the protocol revenue that belongs to stakers in the vault is swapped to buy more POP.
Governance
Poppy Finance is structured as a decentralized autonomous organization (DAO) where holders of POP decide the future direction of the Poppy Finance protocol.
Matters of importance that will be determined by POP holders include: fees charged, supported tokens on the platform and utilization of treasury proceeds.
POP tokens represent a 100% governance stake of the Poppy Finance protocol.
8. Roadmap
The plan for Poppy Finance is simple: deliver a secure and user-friendly platform that incentivizes users to participate in Cardano DeFi.
We strive to become a market leader by writing secure code and providing a world-class user experience.
Currently, participating in DeFi protocols on Cardano is a tedious process. Poppy aims to simplify this monotony by allowing users to lock their funds in a vault without having to worry about manually rebalancing their positions.
Updated: Our new roadmap can be found at our catalyst proposal here.
9. Final Remarks
At Poppy Finance, we strive to deliver a secure, transparent, and efficient
yield optimizer that helps foster the explosion of Cardano DeFi.
With features such as yield optimization, liquidity aggregation, automated yield reinvestment, smart vaults, revenue sharing and community governance, we believe Poppy Finance is poised to become a leading participant in the Cardano DeFi ecosystem.
By providing users with the tools they need to make informed investment decisions and earn passive income, Poppy Finance empowers individuals to unlock the full potential of their digital assets.
Cardano DeFi is exploding.
We make it pop.
For more information on Poppy:
Poppy is a next generation non-custodial yield optimizer built to help anchor Cardano’s DeFi domination.
Disclaimer
Percentage figures provided in this litepaper are subject to change in the future at the discretion of the DAO protocol. While every effort has been made to present accurate and up-to-date information, the dynamic nature of the protocol may require adjustments to the stated percentages. The protocol reserves the right to modify these percentages to ensure the continued functionality, security, and efficiency of the system.
