Following the release of our roadmap, we have received overwhelming positive feedback from the community. While some may consider our ambitions to be lofty, we firmly believe in the importance of setting a North Star to create a shared vision and proactively develop strategies to overcome the incredible challenges ahead. In an environment where we are inundated with negative news on a daily basis, we remain steadfast in our commitment to building and developing innovative solutions that will benefit the entire Web3 ecosystem.

Leveraged stETH Strategy

We conducted a detailed feasibility study to assess the potential value of developing a leveraged staked ETH (stETH) strategy and have since broken down the strategy into multiple phases. The strategy relies on developing smart contracts that integrate Aave V2, Aave V3, Euler, Lido, and Compound III, with corresponding optimal allocations to ensure profitability at scale. With the ongoing updates to our platform architecture and backend heuristics, we can now begin developing more complex and valuable strategies for the ecosystem. We believe that launching advanced strategies that scale will be crucial in attracting TVL growth and providing easy and seamless access to yield opportunities for all types of Web3 users.

Smart Contracts

We have successfully developed smart contracts for two stETH strategies: one that accepts wrapped ETH as a deposit and another that accepts USDC. Additionally, the vaults supporting these strategies are tokenized, providing added flexibility and use cases. The phase 1 USDC-stETH contract development is complete, with a pull request submitted and awaiting merge. The phase 1 Weth-stETH contract is currently undergoing full test coverage to identify any potential attack vectors. Both contracts will soon undergo audit. However, the recent Euler exploit did affect our timeline for submitting the contracts for audits. Nevertheless, we have made necessary adjustments and are nearing the finish line. It is also worth noting that for USDC-stETh strategy, platform users will be getting exposure to ETH’s POS yield without having to hold ETH and the yields can potentially be higher than Lido or other liquid staking platforms depending on the borrow rates for ETH and the leverage risk-reward opportunities.

Backend

During the development of our leveraged stEth strategy, our backend engineers worked on improving the backend’s capabilities to allow quicker implementation of future loan providers and support the launch of the Levered stEth Strategy. Furthermore, newer modules are to be created to support the leveraged stETH strategies, and the backend is in the process of being updated to fully support donations and NFT donation receipts.

Strategy pages for the Website

One of the key feedback from the phase I launch of the platform was development of pages on our platform that explains each strategy in detail and how they work. Those pages are complete with detailed animations for Amethyst and Jade strategies and should go live soon. Given that we have a standardized layout, we have also begun working on pages for future strategies.

Many other changes pertaining to enabling multiple strategy support, timeline UI/UX changes to support modifications to the new timelock, etc. were also worked on by the front-end team.

Staking

Smart Contracts

Much of the work on the development of smart contracts for Staking has been done. Items pending are extensive review of edge cases to discover any potential attack vector, finalizing the UI/UX with community members and implementing their feedback and getting them audited. We have rescheduled our priority list to get the leveraged stEth strategy go live and then we will refocus on getting the Staking section of the platform to go live following that.

OPYN Crab Strategy

As indicated in our timeline, we will be launching an Opyn Crab strategy (OCS) as well and much of the contracts have been developed. Opyn Crab will be launched following the launch of stEth and staking. OCS will require an indepth edge case study and audit.

Account Abstraction and Starknet Migration

Though contracts for account abstraction (AA) have been deployed to mainnet, we have yet to assess its potential in supporting our use cases, namely with regards to gas costs for Sandclock, and its users. As you may be aware, the last phase of the leveraged stETH strategy includes the porting and augmentation of Sandclock’s novel vault architecture to StarkNet. This architecture will make use of StarkNet’s AA capabilities.

Mobile Experience

Developing a seamless mobile UI/UX for Sandclock is important. We have had many discussions and discovery sessions. Unfortunately, to use Sandclock via mobile devices comes with its own set of challenges and hence we have moved it around our priority list. Accessing the full potential of Defi projects via mobile devices and allowing complex interactions between multiple smart contracts and blockchain transactions, is difficult and clunky at the moment. Nevertheless, we are exploring different options to enable our vaults and strategies to be accessed via mobile phones.

Sandclock Vault APYs

With the market actively oscillating between the bull and bear sentiments, the APYs for existing strategies are continuing to rise. The 7-day average has hovered above 8% and if the market continues to exhibit weakening of the dollar against ETH, then our ETH accumulator contract should deliver attractive APYs. With the banking sector in turmoil and Balaji’s bet that there will be a run on the US currency, our Jade vault should be an ideal hedge against inflationary pressures that could devalue the US dollar.

Regulation

Especially in the United States, the regulatory landscape remains murky at best, hostile at worst. In discussions we’ve had with others working to build the crypto industry, repeated themes have emerged, including: frustration with the SEC’s regulation by enforcement approach, concern about the implementation of FedNow and a possible CBDC, and the reluctance of service providers in legacy industries to be involved with anything involving crypto due to the regulatory uncertainty. The collapse of several high-profile players in the space has led to increased regulatory hawkishness and skepticism towards crypto, encapsulated by Sen. Warren’s continued hostile rhetoric towards the space, rumors of an Operation Chokepoint 2.0 targeting crypto banking access, and the White House stating in the newly released 2023 Economic Report of the President that crypto assets “are largely speculative investment vehicles and are not an effective alternative to fiat currency. Also, they are too risky at present to function as payment instruments or to expand financial inclusion.” Conscious of this reality — and obviously disagreeing with those opinions — we continue to proactively work with our government affairs firm to educate lawmakers at the state and federal levels on the benefits of distributed ledger technology in order to foster the development of regulations that allow the space to innovate and thrive while protecting consumers from the sorts of bad actors who are inhibiting mainstream adoption of the technology.