The Keep3r Network update: Rethinking Demand & Keeper Jobs

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Keep3r Network

7 min readJan 8, 2024

An insight into our thoughts on improving decentralization in keeper protocol utilization. Announcing the next iteration in keeper standards - xKeeper

Introduction

In this article we will share some thoughts on evolving the Keep3r Jobs network & utilization of Keepers, we include;

Recap of 2023 new features
Importance of keepers & decentralization
How keepers are & can be used
Keeper use & job creation origination
Thoughts on Keep3r Network design & incentives
Attracting job creators
Collaboration opportunities
Next: xKeeper & The Keep3r Network enhancements

Keep3r in 2023; Recap

In 2023, we announced the biggest upgrades for the Keep3r Network to date, which included;

Support for multi-chain functionality
UI update to our site
Cross-chain communication achieved via Connext’s data bridging
Cross-chain oracles, maintaining high precision TWAP oracles across multiple chains
Profitability assurance for Keepers, through an upgrade to rewards
Audit completed by MixBytes
Updates to our Keep3r Network documentation, script templates & smart contract utils, making it easier for Job creators and keepers to get started
We launched a brand new Dune dashboard, tracking KP3R token supply, Protocol Owned Liquidity (POL) & fee generation

Keepers & Decentralization

The Keep3r Network was founded on a strong belief that Keepers are an essential piece of blockchain infrastructure that can benefit protocol & product teams through automation. Decentralized participants can execute everything from simple transaction calls to complex off-chain logic

All previous versions of the Keep3r Network have been designed with this in mind, including our economic structure, incentives, tools & UI

The Keep3r Network currently has Jobs listed that automate tasks for Maker, Yearn, Connext & Phuture Finance

How Keepers are used

Keepers can help automate a wide variety of use cases including (but not limited to);

Vault harvest
Batch asset management (swaps, fee distribution, etc)
Liquidations
On-chain fee claims
On-chain borrowing position management (debt ratio health)
Oracle upkeep
On-chain options management

In addition to this Keep3r Network created an early demonstration of how Keepers can be used to help measure on-chain volatility & price options (see uniquote; 1, 2, 3, 4)

Many teams rely on Keepers for day-to-day management, including Maker, Curve, Aave, Compound, etc

As protocols have become more gas-cost conscious, we have also noted the potential for development teams to integrate keeper utilization within their smart contract design, simplifying core-contract structure to ensure smart contracts are gas-optimized by utilizing keepers for any suitable gas-intensive functions

Who creates keeper jobs?

As the landscape, complexity, and defi as a whole have evolved, so too have how potential creators of jobs should be thought about

We acknowledge that the Keep3r Network was designed with primary job creation demand originating from other protocols. Today we see differentiation in the types of Job creators across keeper protocol solutions, with;

Protocols designing external task management competition & incentivize directly. Examples; Curve Finance creates incentive structures for their PegKeepers used in crvUSD or how many lending protocols design economic incentive structures for liquidations (1, 2, 3, etc)
Protocols designing external task management with keeper execution in mind. In this case, protocols must think about how to fund incentivizing keeper job management
Individual smart contract users who want to outsource regular task management. Examples; fee claims, debt ratio management, LP incentive claims, etc

As we considered other Keeper solutions by Gelato, Chainlink & OpenZeppelin we realized that some of these solutions may currently be better suited for some of the different job creator types

In thinking about the future of the Keep3r Network we realize that we have to think differently about the user experience, job funding, and execution for each of these different types of job creators if we want to maximize the potential adoption of each unique use case

We believe that in doing so, we can unlock wider utilization of automation within the space, and far greater economic benefits for keepers and job creators and bring the benefit of more keepers available for keeper solutions

The Keep3r Network incentive design

In our previous inceptions, the economic model for the Keep3r Network was designed with two aspects considered;

How to create a cost-effective way for external protocols to manage external automation tasks
How to make the execution of Jobs economically beneficial for Keepers

In creating a solution for an economic model, the Keep3r Network team wanted to help teams transition away from DevOps activity being a G&A expense style cost factored into running the protocol & create something that helped mitigate the fluctuations in the cost of gas & overheads for Keepers

The solution created the concept of kLP bonding and the credit minting process. Whilst we maintained the flexibility to fund jobs through any ERC20 token, this innovative solution helped achieve the realization of our first & second goal

The process of listing a job via kLP & credit minting requires three actions;

1: Protocols to acquire KP3R tokens
2: Add full-range liquidity on Uni V3 in the KP3R/ETH pair
3: Bond LP as kLP

In return, the bonded kLP mints new KP3R tokens that will fund payment of the Job in newly minted KP3R tokens when executed by the network of keepers registered to the Keep3r Network

Protocols listing Jobs maintain a claim on the underlying Uni V3 position, meaning if Job is no longer required then the protocol can withdraw all previously provided liquidity in full

This effectively transitions G&A expense cost planning to a CAPEX outlay for teams (i.e. protocols hold KP3R/ETH LP vs spend gas directly or incentivize with other ERC20 tokens to subsidize for cost of gas)

To ensure that each keeper's gas & DevOps overhead costs are covered in the execution of jobs, the Keeper is paid enough KP3R to compensate for gas costs in full + a bonus of up to 20%

This design structure also benefited the Keep3r Network as all Uni V3 liquidity locked earns transaction fees for the Keep3r treasury. New demand for KP3R tokens was created as;

Protocols acquire KP3R to provide funding for the credit minting system
Keepers acquire and bond KP3R to qualify for Jobs (note, some Jobs require 50 KP3R bonded for keepers to work job)

At date of publishing, there are 5600+ KP3R locked in kLP

Thoughts on attracting job creators

Whilst the team analyzed the evolved landscape of all potential job creators we realized that the economic incentives & the opportunities available to The Keep3r Network needed to be re-thought. In doing so we identified that;

The Keep3r Network could benefit from the opportunity to list Keep3r treasury-sponsored jobs that compete with other automation solutions already designed by protocols (see; “Who creates keeper jobs” # 1).
The UI experience for individuals wanting to automate tasks is not simple enough to encourage adoption within the Keep3r Network
Resourcing on the Keep3r Network team is not suitably optimized to gain wider adoption of Job listings or add more keepers to the network

Tackling these opportunities can unlock additional benefits. Examples;

The Keep3r treasury creates and lists sponsored jobs, which add to the library of existing Jobs, it showcases the potential of automation to teams and individuals
An extended library of job types listed adds the benefits of making it easier for protocols to think through implementation, fork, adjust, and create new Job listings
A simplified UI experience would attract individuals seeking automation but wanting to mitigate the unpredictability of gas costs, through the adoption of the credit minting system

To fully realize the potential of these ideas we acknowledged that creating an ongoing source of dedicated funding to be utilized in resourcing a team focused on Job creation, keeper onboarding, and adoption will be essential in the successful implementation of these concepts

Cross-collaboration across keeper networks

We came to think of the keeper experience as being under-optimized. Keepers could greatly benefit from the opportunity to reutilize their DevOps infrastructure across any keeper protocol, where cross-collaboration can be enabled. Helping keepers maximize their maintenance cost and utilization of existing tooling

In thinking this through we also realized that if we could solve for cross-collaboration across keeper protocol networks then this would likely attract a greater depth of keepers, benefiting not just the Keep3r Network but all keeper networks as greater depth of keepers means the tasks are more likely to be completed timely & to cost while also creating far greater assurances of decentralization

Next: xKeeper & Keep3r Network enhancements

Thanks to the team at Wonderland we have been able to ideate, develop, and create new solutions that solve the challenges identified and outlined here

We are thrilled to announce updates that are a significant step toward a decentralized future, where networked keepers collaborate across various systems and networks

The first of these is a new collaboration standard, xKeeper — inspired by the xERC20 standard for bridged tokens. xKeeper is available for all keeper networks allowing;

job creators to set jobs using multiple keeper network protocols & utilize their UI, offer flexibility in funding (including the adoption of kLP) & have the job become executable on all platforms multichain with minor additional settings
keepers will be able to work jobs listed across multiple keeper network protocols

We plan on sharing more details about xKeeper shortly

The code is complete, audits are pending

The Keep3r Network meanwhile will move forward with the following changes;

Early adoption of the new xKeeper standard
Keep3r treasury sponsored jobs
New keeper job use case development
New revenue stream, funding dedicated dev resourcing to drive wider adoption of keeper jobs

More details on Keep3r Network job listings & dev resourcing will be announced

Summary

Recap of Keep3r Network in 2023
Keeper uses explained
Job creators considered
Keep3r Network & job funding by credit mining explained
Introduce xKeeper Standard
Keep3r Network treasury-sponsored jobs
Keep3r Network development team to create new job listings & help onboard protocols, users & keepers