SECTION 1: APPLICANT INFORMATION
Provide personal or organizational details, including applicant name, contact information, and any associated organization. This information ensures proper identification and communication throughout the grant process.
Applicant Name: Joe Sticco
Project Name: Cryptex Finance
Project Description: Cryptex is a DAO/ DeFi Protocol deployed on the Arbitrum network. The protocol develops and deploys crypto-native perpetual markets for Arbitrum users. The protocol uses Ethereum smart contracts, Perennial derivatives vaults, and data oracles/price feeds from Chainlink & Pyth to provide secure and trustless trading.
Team Members and Roles:
Joe Sticco:
Co-Founder and Core Contributor
Developing new markets, working alongside multiple protocols for relevant partnerships
Trader and Asset Manager with 15+ years of experience.
Crypto Since 2016
Thomas Matzner:
Co-Founder and Core Contributor
Business operations
Strategic Planner and Brand Builder with 13+ years of experience
Crypto since 2013
Voith Mascarenhas:
Solidity developer
8+ years of development experience
Crypto since 2017
Jorge Destephen:
Full Stack Developer
7+ years of development experience
Crypto since 2017
Sashimi Boi:
Data Science
5+ years experience
Crypto since 2020
Cullen Wright:
VFX Artist
20+ years of experience
Crypto since 2020
Project Links:
Website: https://cryptex.finance/
Dapp: https://v2.cryptex.finance/
Twitter: [@cryptexfinance]
GitHub: Cryptex Finance · GitHub
Documentation: https://docs.cryptex.finance/
Point of Contact: @joecryptex
Point of Contact’s TG handle: @joecryptex
Twitter: @cryptexfinance
Email: Joe@cryptex.finance
Do you acknowledge that your team will be subject to a KYC requirement?: Yes
SECTION 2a: Team and Product Information
Provide details on your team’s past and current experience. Any details relating to past projects, recent achievements, and any past experience utilizing incentives. Additionally, please provide further details on the state of your product, audience segments, and how you expect incentives to impact the product’s long-term growth and sustainability.
Since April 2021, Cryptex core DAO contributors have been developing and creating cutting-edge decentralized markets. Our contributors began with the tokenization of TCAP, a Total Crypto Market Cap solution that provides exposure to the entire cryptocurrency market in a single tokenized asset.
V1 of this system was based on a total crypto market cap price feed powered by Chainlink, an on-chain data aggregation formula, and an over-collateralization model. Launched in April 2021 on Ethereum mainnet, the first iteration of this system saw over $200m in cumulative mints and burns of the token to date.
More info about TCAP V1 here: https://cryptex.finance/White_Paper.pdf
TCAP is live on Arbitrum, and we wish to utilize these incentives in the bootstrapping of both liquidity and activity in the utilization of this market. It is the first time a perpetual market exists for Total Crypto Market Cap.
On 11/28/23, we deployed Cryptex Pi on the Arbitrum network. Currently, the system has:
- 13 Markets (Including TCAP)
- 13.15MM Available System Liquidity
- 917.70K Open interest
- Utilizing Perennial Finance infra, we have currently deployed 12 Perpetual markets as well as TCAP, Cryptex’ Total Crypto Market Cap perpetual. This is the market we are incentivizing.
- We are currently recognized as the #15 top derivatives project within the Arbitrum ecosystem based on TVL
Source: https://twitter.com/_smartliquidity/status/1763188400880775296?s=46&t=P7lUa9u06TCGJDWU6d8vuw
What novelty or innovation does your product bring to Arbitrum?
The goal of Cryptex is to provide cutting-edge decentralized markets to the Arbitrum ecosystem.
TCAP is the first of its kind on the Arbitrum network. It tracks the entire crypto market capitalization and brings this data to system users in a single solution.
The value of the entire cryptocurrency market is calculated on-chain and validated by Chainlink, using multiple data providers. The median value is then signed on-chain. Cryptex then further aggregates this metric, and the feed updates at a 0.5% threshold. From there, users can access total crypto market cap exposure.
Source: Cryptex Finance
We expect the incentivization of this market to raise more awareness to system users interested in perpetual index markets, continue building our market share within the ecosystem, and grow our relationships with both LP’s and system users.
It should be noted that Cryptex is actively working with both Chainlink and Pyth to develop unique, customizable price feeds and markets to be deployed within the Arbitrum ecosystem, and new markets for the Cryptex Pi system are slated for deployment in 2024.
Is your project composable with other projects on Arbitrum? If so, please explain:
Yes. Currently, Cryptex Pi is built on top of Perennial Finance infrastructure, to which 12 markets are live on Cryptex.
Source: https://app.cryptex.finance/
Additionally, we have the ability to create customizable markets within this infrastructure. It should be noted these incentives will be utilized for TCAP, a Cryptex market and not the Perennial markets. It should also be noted several other integrations are underway.
Do you have any comparable protocols within the Arbitrum ecosystem or other blockchains?
Perennial, GMX, Gains Network all offer perpetual solutions or derivatives.
How do you measure and think about retention internally? (metrics, target KPIs)
- Total Unique Takers
- Total Unique Makers
- TVL
- Daily Open Interest
- Liquidity Providers
- Notional Volume
Relevant usage metrics - Please refer to the OBL relevant metrics chart 9. For your category (DEX, lending, gaming, etc) please provide a list of all respective metrics as well as all metrics in the general section:
https://dune.com/cryptexfinance/cryptex-dashboard
Do you agree to remove team-controlled wallets from all milestone metrics AND exclude team-controlled wallets from any incentives included in your plan: Yes
Did you utilize a grants consultant or other third party not named as a grantee to draft this proposal? If so, please disclose the details of that arrangement here, including conflicts of interest (Note: this does NOT disqualify an applicant): No
SECTION 2b: PROTOCOL DETAILS
Provide details about the Arbitrum protocol requirements relevant to the grant. This information ensures that the applicant is aligned with the technical specifications and commitments of the grant.
Is the protocol native to Arbitrum?: Yes, Cryptex Pi is native to the Arbitrum network.
On what other networks is the protocol deployed?: TCAP is also deployed on Ethereum and Optimism. CTX, our protocol governance token is deployed on Ethereum main-net and Arbitrum, with protocol governance on the ETH network.
What date did you deploy on Arbitrum mainnet?:
Our initial launch on Arbitrum was on February 6th, 2023. Arbitrum Transaction Hash (Txhash) Details | Arbiscan
Cryptex Pi was deployed to Arbitrum on 11/28/2023
Source: https://twitter.com/cryptexfinance/status/1729594596684943698?s=46&t=P7lUa9u06TCGJDWU6d8vuw
Do you have a native token?: Yes. CTX is the governance token powering the Cryptex DAO. It has been live since 4/2021 and is currently available on Coinbase, Gemini, Huobi, Sushiswap, Camelot, Trader Joe, etc.
Past Incentivization: What liquidity mining/incentive programs, if any, have you previously run? Please share results and dashboards, as applicable?
We received the initial Arbitrum Airdrop of 75K ARB, which the Cryptex community then voted to return 100% of to Arbitrum users via Cryptex LP/system incentives.
Current Incentivization: How are you currently incentivizing your protocol? We are currently not incentivizing TCAP or running direct incentives for the protocol.
Have you received a grant from the DAO, Foundation, or any Arbitrum ecosystem-related program? No.
Protocol Performance: [Detail the past performance of the protocol and relevance, including any key metrics or achievements, dashboards, etc.]
https://dune.com/cryptexfinance/cryptex-dashboard
https://dune.com/cryptexfinance/cryptex-dao-dashboard
Protocol Roadmap: [Describe relevant roadmap details for your protocol or relevant products to your grant application. Include tangible milestones over the next 12 months.]
Audit History & Security Vendors: [Provide historic audits and audit results. Do you have a bug bounty program? Please provide details around your security implementation, including any advisors and vendors.] Audits | Cryptex
Q1 Roadmap:
- Support different order types for Cryptex Pi such as Limit Orders, Stop Loss orders, etc.
- New Keeper incentives model
- Create/Research Strategies for creating new/unique oracles for custom markets.
- Research how to calculate parameters for deploying unique markets on Cryptex Pi/Perennial V2
- Launch New Markets
Security Incidents: [Has your protocol ever been exploited? Since April 2021 to date, Cryptex has never been exploited.
SECTION 3: GRANT INFORMATION
Detail the requested grant size, provide an overview of the budget breakdown, specify the funding and contract addresses, and describe any matching funds if relevant.
Requested Grant Size: 165,000 ARB
Justification for the size of the grant: [Enter explanation. More details are better, including how you arrived at the required funding for individual categories of expenses covered by your grant plan] Grant Breakdown:
Currently, Cryptex Pi TVL sits at approximately 2.02m.
Source: https://defillama.com/protocol/cryptex-pi?tvl=true&usdInflows=false&twitter=false&groupBy=cumulative
The goal for this grant is to continue growing our TVL within Cryptex Pi, targeting an increase of 2-3x over the course of this three month period.
To do this, we estimate the following for TCAP.
- 101,250 ARB to be deployed to TCAP liquidity incentives
- 63,750 ARB to be deployed to TCAP usage rebates
Funding Address: GnosisSafeProxy | Address 0x8705b41f9193f05ba166a1d5c0771e9cb2ca0aa3 | Arbiscan
Funding Address Characteristics: 2/3
Treasury Address: [Please list out ALL DAO wallets that hold ANY DAO funds]
Contract Address: [Enter any specific address that will be used to disburse funds for grant recipients]
For Vault Incentives: 0x938F145D5f3ABf681618Dcc5c71f095B870747Ba
For Usage Rebates: 0x33a8A8c43c6077Ae0D3AB9599Aa2189c75FD1D33
SECTION 4: GRANT OBJECTIVES, EXECUTION AND MILESTONES
Clearly outline the primary objectives of the program and the Key Performance Indicators (KPIs), execution strategy, and milestones used to measure success. This helps reviewers understand what the program aims to achieve and how progress will be assessed.
Objectives: The primary objective of this grant is to bring awareness to TCAP. This is achieved in two ways.
Providing LP incentives to users who deploy liquidity to TCAP over a 3-month period.
16,875 ARB deployed each two weeks for a period of 3 months.
Providing usage rebates to users who access TCAP.
10.625k rewards deployed over each two-week period during a period of 3 months. It should be noted usage rebates will be rewarded on a first-come-first-serve basis.
Execution Strategy: [Describe the plan for executing including token distribution method (e.g. farming, staking, bonds, referral program, etc), what you are incentivizing, resources, products, use of funds, and risk management. This includes allocations for specific pools, eligible assets, products, etc.]
By incentivizing both sides required to build a robust market, we estimate and assume the following.
101,250 LP incentives @ an assumption of 20% APR
((125000 * 2)/(0.2 * 84)) * 365 = approx $4,400,000 in additional TVL.
63,750 ARB for usage rebates = to entry costs of a TCAP trade (0.2125%) on a first-come-first-serve basis.
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Please note we are using 20% as an assumption of LP yield for these rewards. There is no way to guarantee this yield will be achieved. However, we have reached this as a baseline assuming that, Total Crypto Market Cap (in comparison to other crypto assets) is both a novel asset on the Arbitrum network and has a lower level of overall volatility relative to individual tokens and longer tail assets.
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Any incentives not utilized will be returned to the Arbitrum DAO.
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At the end of the grant period, the Cryptex DAO will hold a proposal where revenues earned from this grant will be voted on to be converted back to ARB to continue the incentives to TCAP system users in an effort to continue alignment within the Arbitrum ecosystem.
Specify the KPIs that will be used to measure success in achieving the grant objectives and designate a source of truth for governance to use to verify accuracy. [Please also justify why these specific KPIs will indicate that the grant has met its objective. Distribution of the grant itself should not be one of the KPIs.]
- Number of daily active users
- Total Notional
- TVL
- Daily Open Interest
- A fully transparent dune dashboard for the ecosystem to track these KPIs in real time throughout the duration of the grant.
Grant Timeline and Milestones: [Describe the timeline for the grant, including ideal milestones with respective KPIs. Include at least one milestone that shows progress en route to a final outcome. Please justify the feasibility of these milestones.]
Month 1: Increase TVL by 1.46mm and notional volume of 10mm
Month 2: Increase TVL by 2.93mm and notional volume of 20mm
Month 3: Increase TVL by 4.4mm and notional volume of 30mm
How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem? [Clearly explain how the inputs of your program justify the expected benefits to the DAO. Be very clear and tangible, and you must back up your claims with data]
This grant will be able to continue our ability to foster innovation by raising awareness to perpetual index markets available in the Arbitrum ecosystem. The goal here is to prove viability of these indexes, continue our development efforts on new indexes and innovate for the Arbitrum ecosystem.
Do you accept the funding of your grant streamed linearly for the duration of your grant proposal, and that the multisig holds the power to halt your stream? Yes
SECTION 5: Data and Reporting
OpenBlock Labs has developed a comprehensive data and reporting checklist for tracking essential metrics across participating protocols. Teams must adhere to the specifications outlined in the provided link here: Onboarding Checklist from OBL 12. Along with this list, please answer the following:
Is your team prepared to comply with OBL’s data requirements for the entire life of the program and three months following and then handoff to the Arbitrum DAO? Yes
Are there any special requests/considerations that should be considered? No
Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread that reference your OBL dashboard? Yes, we will comply with this in a manner that is publicly transparent and accessible to all.
First Offense: In the event that a project does not provide a bi-weekly update, they will be reminded by an involved party (council, advisor, or program manager). Upon this reminder, the project is given 72 hours to complete the requirement or their funding will be halted.
Second Offense: Discussion with an involved party (advisor, pm, council member) that will lead to understanding if funds should keep flowing or not.
Third Offense: Funding is halted permanently
Does your team agree to provide a final closeout report not later than two weeks from the ending date of your program? This report should include summaries of work completed, final cost structure, whether any funds were returned, and any lessons the grantee feels came out of this grant. Where applicable, be sure to include final estimates of acquisition costs of any users, developers, or assets onboarded to Arbitrum chains. (NOTE: No future grants from this program can be given until a closeout report is provided.) Yes
Does your team acknowledge that failure to comply with any of the above requests can result in the halting of the program’s funding stream?: Yes