UIP-7

Short Name

UIP-7

Long Name

Uniwhale X Wormhole Mesh

Area of Impact

Liquidity Pool

Logistics

Where: Uniwhale space at Snapshot.org
When: 2PM UTC August 11, 2023–2PM UTC August 14, 2023
To participate, you must unstake esUNW before the Snapshot.org snapshot.

Proposal Description

The Wormhole Foundation is excited to propose a partnership to facilitate and fortify Uniwhale’s cross-chain expansion to Arbitrum from BNB. We propose that Uniwhale and Wormhole collaborate to build a novel “Mesh” architecture that will aggregate liquidity across Uniwhale’s deployments on BNB and Arbitrum.

This partnership should accomplish at least two objectives for the Uniwhale community:

1) Cross-chain expansion: The Uniwhale protocol can efficiently expand its addressable market to first Arbitrum. In the future, Uniwhale may leverage this same architecture to expand to further EVM and non-EVM chains.

2) Enhanced UX: With this integration, BNB traders can access liquidity natively across BNB and Arbitrum, and Arbitrum traders can access liquidity natively across BNB and Arbitrum.

Technical Overview: Mesh Architecture, powered by Wormhole

The proposal entails designing and implementing a smart contract called “Rebalancer”, which will be deployed on both BNB and Arbitrum and facilitate such liquidity aggregation.

Specifically, using Wormhole’s cross-chain messaging and bridging technology, Rebalancer

• Posts Excess Liquidity that can be lent out from a Liquidity Pool (on BNB and Arbitrum)
• Requests loans from one or more Rebalancers with Excess Liquidity,
• Requests loan repayments from one or more Rebalancers with existing borrowing, and
• Accepts loan / repayment requests from another Rebalancer, initiates bridging of requested amount to the destination chain.

As part of the integration, Uniwhale’s Liquidity Pool will be upgraded to allow lending of excess liquidity and borrowing to cover any shortfall, facilitated by Rebalancer.

Liquidity Pool will consist of (a) USDT (as is the case today) and (b) “USDT-IOU”, issued by Rebalancer, which represents the amount lent out to Rebalancer.

The available liquidity at a given Liquidity Pool, therefore, is the sum of USDT and USDT-IOU.

The available aggregate liquidity at the protocol level available on BNB and Arbitrum is, therefore, the sum of the liquidity at BNB and Arbitrum.

Who is Involved?

Uniwhale and Wormhole teams

Target Timeline

Testnet Launch and Security Audit: Q4 2023
Mainnet Launch: Q1 2024

Security Considerations

• Wormhole is one of the most audited protocols in the world — regularly receiving audits from top firms like Trail of Bits, Halborn, Ottersec, Neodyme, Certik, Hacken, Zellic, Coinspect, and Kudelski. Its whole protocol is regularly reviewed — see the whole list of audits (past and future scheduled — here). Additionally, Wormhole has a well publicized $2.5M bounty
• Wormhole is trusted by some of the top protocols in all of crypto — Uniswap, Aave, Threshold, Circle, Pyth, and more.
• Wormhole has nineteen guardians comprised of institutional PoS validator companies who jointly attest to messages. Our Guardians are some of the largest and most respected PoS validators — collectively representing tens of billions of staked capital across Ethereum, Polygon, and more. Each Guardian holds equal weight in consensus and governance. Of the 19 guardians, Wormhole requires over two-thirds to reach consensus and pass verification — thus, we assume that at least one-third of our guardian set is honest.
• Additionally, the Wormhole community remains resolute on improving our trust assumptions — as such, contributors are placing heavy investments in moving towards a completely trustless system based on zero knowledge proofs 3. This architecture leverages zero-knowledge proofs as a mechanism for directly attesting to the consensus rules of the blockchain. Light clients provide a mechanism for doing exactly this.

About Wormhole

Wormhole is the industry standard cross-chain messaging protocol powering applications across Web3. Wormhole provides developers access to liquidity and users on over 20 of the leading blockchain networks, enabling use cases that span DeFi, NFTs, governance, and more. Wormhole enables a growing suite of products to build on its messaging layer. Wormhole Connect is a key messaging layer product, providing developers an in-app bridging widget that can be integrated in as few as 3 lines of code. The wider Wormhole network is trusted and used by teams like Circle (USDC) and Uniswap, and to date, the platform has facilitated the transfer of over 35 billion dollars through hundreds of millions of cross-chain messages.

Voting

The voting will take place at the Uniwhale space at Snapshot.org.

The voting will start at 2PM UTC August 11, 2023 and end at 2PM UTC August 14, 2023

To participate, you must unstake esUNW before the Snapshot.org snapshot. You can stake your esUNW again after your vote is recorded. You are recommended to unstake at least 30 minutes before the intended voting start, to ensure the Snapshot.org nodes can capture your unstaked esUNW.

Snapshot.org is a 3rd-party platform we use to facilitate off-chain voting. In accessing and/or using Snapshot.org, you acknowledge and agree that you shall have no claim against Uniwhale or its affiliates in respect of any loss suffered by you in relation to or arising from your access and/or use of Snapshot.org.

Join us!

To get involved and stay updated on all Uniwhale-related matters:

• Visit us on uniwhale.co
• Find our codes on Github
• Follow Uniwhale on Twitter
• Subscribe to the Uniwhale Medium
• Join the Uniwhale community on Discord