Poolshark - A Decentralized Protocol for Directional Liquidity

Dora Grant DAO
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Who we are

Poolshark is a directional automated market maker (DAMM), meaning that in addition to supporting the kinds of liquidity providing methods users have come to know and love, we will also allow users to passively capture buy-and-hold profits from the market.

Poolshark as a directional automated market maker, was first conceptualized in September of 2022 after recognizing the need for one-way liquidity positions from talking to options protocols. Options ERC-20s always have the risk of the price converging to zero as the expiry approaches, and it was clear from this that there was a need for taking a one-way LP position that trades in a single direction.

Current AMMs (i.e. Uniswap, Curve, etc.) apply mean-reversion trading strategies at the smart contract level, meaning they are always shorting volatility. This is great for stable asset pairs and allowing for continuous trading on volatile assets, however LPs tend to experience negative externalities:

  1. Gas fees
  2. Front-running
  3. Swap fees

If you have a definitive idea of a trade that you want to execute some time in the future, it really doesn’t make sense to be on the swap side of the transaction. Probably we would advocate that most users be on the LP side so they don’t have to deal with the complications of executing a swap.

Our mission

To enables LPs to become more profitable.

We are solving for

  1. Mitigation of Impermanent Loss
  2. Gas-efficient buy-and-hold range strategies
  3. Advancing the AMM space by unlocking directional strategies

Key components

Price Pools

  • Take Profit range order
  • Quick entry or exit
  • Playing spreads

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Cover Pools docs page


Cover Pools

  • Stop loss range order
  • IL mitigation
    • balances out LP position using price reference
  • Bullish entry

Price Pools docs page

What we seek

We are seeking an amount of $50k for a duration of 4 months involved in the following uses:

  1. Smart contract audits for Cover, Price, and Range protocols
  2. Launching the smart contracts on a few chains, namely Arbitrum, Mainnet, and zkSync 2.0
  3. Building out our SDK and Order Router to split swaps between pools and consider gas costs
  4. Supporting LPs in their efforts to become profitable through data analysis and open source products

Short Term Valuated Roadmap

  1. Mar. 2023 – Complete Smart Contract Audit; Launch testnet
  2. Apr. 2023 – Launch Arbitrum mainnet for Cover and Range pools
  3. May. 2023 – Support for Sushiswap LPs; Smart contract audit for Price Pools
  4. May. 2023 – Launch Arbitrum mainnet for Price Pools