[SynFutures] LTIPP Application Draft

SECTION 1: APPLICANT INFORMATION

Applicant Name:

Tracy Hoa

Project Name:

SynFutures

Project Description:

SynFutures is a leading perp DEX that creates an open and trustless derivatives market by enabling trading on anything with a price feed anytime. SynFutures democratizes the derivatives market by employing an Amazon-like business model, giving users the tools to freely trade any assets and list arbitrary futures contracts within seconds.

Team Members and Roles:

Rachel Linn: CEO
Matthew Liu: CSO
Mark Lee: CMO
Tracy Hoa: BD

Project Links:

Website: https://www.synfutures.com
Github: SynFutures · GitHub
Twitter: https://twitter.com/SynFuturesDefi
Discord: SynFutures
DefiLlama: https://defillama.com/protocol/synfutures

Point of Contact:

Tracy Hoa

Point of Contact TG

@iamtracymm

Do you acknowledge that your team will be subject to a KYC requirement?:

YES

SECTION 2A: Team and Product Information

Rachel Lin is the co-founder and CEO of SynFutures, a decentralized derivatives trading platform. She previously worked in the global markets division at Deutsche Bank specializing in derivatives. She also co-founded Matrixport, one of Asia’s largest crypto neobanks. Since 2020, Rachel has been working to make crypto derivatives accessible to wider audiences through SynFutures.

Matthew Liu is a partner and Chief Strategy Officer at SynFutures. A graduate of Peking University and Northwestern University (MBA), Matthew Liu started his career as a fixed income trader at Deutsche Bank in Shanghai. He later moved to General Motors, where he managed corporate finance and treasury. After that, he worked at fintech giant Ant Group, where he held various leadership roles, including Head of Global Partnerships - Trusple (Blockchain Trade Finance).

Mark Lee is a partner and CMO at SynFutures. He started his career in private investment and later founded Eightfive PR, a marketing and comms agency serving blockchain and crypto projects. Clients included Huobi, Solana, HTC, and Nervos.

Background and SynFutures versions to date

SynFutures is a leading perp DEX that creates an open and trustless derivatives market by enabling trading on any asset with a price feed. Our aim is to fully democratize the derivatives market by allowing users to list new futures contracts without any prior approval. With our permissionless listing, an LP can list new derivative pairs for any asset within seconds, all that’s required is that the asset has an active price feed. With this model, we believe SynFutures can become the premier destination for trading perpetuals of new and trending tokens.

We also have a long history with Arbitrum. We became one of the earliest perp dex’s to launch on Arbitrum when we went live in March 2022. The integration of SushiSwap price feed allowed the early Arbitrum community to list perps of several new assets on the network. We soon reached $10M trading volume .The decision was made to postpone the relaunch on Arbitrum on V3 instead of V2, since V3 was the state of the art product we had in mind while V2 served as the bridge between the old and the new.

We are currently launching SynFutures V3 in Arbitrum which introduces the innovative Oyster AMM. With Oyster, we are able to combine the best of the OrderBook model with the AMM model to appeal to a broad range of traders and LPs. Oyster also introduces concentrated liquidity provisioning for derivatives pairs which greatly improves capital efficiency providing higher returns for LPs and lower slippage for traders. Unlike other models, Oysters is fully on-chain and doesn’t have any off-chain transactions. We believe this makes SynFutures more censorship-resistant and fully aligned with the decentralization ethos of Arbitrum and the wider web3 community.

Up to this point, SynFutures has surpassed $24B cumulative volume with more than 110k all time users. We believe these numbers will increase quickly after our Oyster Odyssey Campaign with the launch of V3.

What novelty or innovation does your product bring to Arbitrum?

SynFutures introduces several innovative features and novelties to the Arbitrum ecosystem that significantly enhance the decentralized finance (DeFi) derivatives trading landscape. Some of the key innovations include:

Permissionless Nature: SynFutures stands out in the DeFi space with its completely permissionless framework. This approach allows any user to list and trade derivatives on any asset with a price feed, democratizing access to derivatives trading. By removing barriers to entry and enabling unrestricted participation, SynFutures enhances the decentralization and inclusivity of the ecosystem.

Oyster AMM: The introduction of the Oyster Automated Market Maker (AMM) represents a significant innovation in the trading model. Oyster AMM merges the advantages of on-chain order books with Concentrated Liquidity Market Makers (CLMM), creating a unified, efficient trading experience. This model simplifies trading, improves liquidity, and enhances market efficiency, setting a new benchmark for DeFi platforms.

Single Token Concentrated Liquidity Provisioning: SynFutures’ Oyster AMM introduces single token concentrated liquidity provisioning for derivatives pairs, which significantly improves capital efficiency. This feature provides higher returns for liquidity providers (LPs) and lower slippage for traders, making the platform more attractive and competitive.

Fully On-Chain and Censorship-Resistant: Unlike other trading models that may rely on off-chain transactions, SynFutures’ Oyster AMM is fully on-chain, enhancing the platform’s transparency, security, and resistance to censorship. This alignment with the decentralization ethos of Arbitrum and the broader web3 community is a testament to SynFutures’ commitment to trustless finance.

Is your project composable with other projects on Arbitrum? If so, please explain:

Yes. As a derivatives DEX with permissionless listing, SynFutures can be highly composable with other projects on Arbitrum. Derivatives of new and emerging tokens can be easily created and traded on SynFutures. Our single-token liquidity model allows LPs to provide liquidity for any pair with just a stablecoin. We believe this advantage will make SynFutures the go-to perp platform for trading both long-tailed assets and established tokens.

Do you have any comparable protocols within the Arbitrum ecosystem or other blockchains?

Since SynFutures is a derivatives dex, it can be compared to GMX, dYdX or Hyperliquid. However, SynFutures’ innovative design is not directly comparable to any other model present.

How do you measure and think about retention internally? (metrics, target KPIs)

SynFutures’ approach to measuring and thinking about retention internally involves analyzing user activity, liquidity provision sustainability, trading volume consistency, and stable TVL Growth.

Data sources we use:

Defillama: https://defillama.com/protocol/synfutures
Dune: https://dune.com/synfutures/synfutures

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 utilise a grants consultant or other third party not named as a grantee to draft this proposal?

No

SECTION 2B: PROTOCOL DETAILS

Is the protocol native to Arbitrum?:

No, SynFutures deployed on Arbitrum on V1 with other networks. Currently we’re deployed on Arbitrum on a closed Alpha in addition to another network.

On what other networks is the protocol deployed?:

SynFutures has deployed on Blast L2 for V3.

What date did you deploy on Arbitrum mainnet?:

SynFutures V1 deployed on Arbitrum during September 2021, in the early days. We have deployed V3 on Arbitrum for a closed Alpha on 10th January 2024

Do you have a native token?

Not yet, but we foresee the native token generation to happen during Q2/Q3 2024.

Past Incentivization: What liquidity mining/incentive programs, if any, have you previously run?

We have run a liquidity provision program called DAO Futures, which allowed protocols to permissionlessly list their assets for liquidity in SynFutures.

Current Incentivization: How are you currently incentivizing your protocol?
Yes. Our V3 mainnet launch campaign Oyster Odyssey (https://oyster.synfutures.com/#/odyssey) is currently incentivizing users to add liquidity, put limit orders and more via a points system.

Have you received a grant from the DAO, Foundation, or any Arbitrum ecosystem related program?
No

Protocol Performance:
Past performance of our v1 and v2 can be found via: https://defillama.com/protocol/synfutures and https://dune.com/synfutures/synfutures. Overall, the first two versions of SynFutures has surpassed $24B cumulative volume with more than 110k all-time users. We recently launched V3 on Blast network in early March and within a short timeframe achieved over $2B in trading volume with more than 100,000 transactions. Details can be found in here: https://info.synfutures.com.

Protocol Roadmap:

Since our deployment on V3 Mainnet at the start of the month, we’ve been hands-on doing campaigns to promote our launch. We have a points system called Oyster Odyssey and a trading competition called ‘Grand Prix’ which are both designed to incentivize users to try the platform. We also plan to launch our native token in Q3/Q4 2024.

Audit History & Security Vendors:

Latest Audit by Quantstamp: https://www.synfutures.com/Quantstamp-Audit-Report-SynFuturesV3.pdf

SECTION 3: GRANT INFORMATION
Requested Grant Size: 150,000 ARB

Justification for the size of the grant:
SynFutures is requesting a grant of 150,000 ARB tokens to accelerate our growth and contribute to the Arbitrum ecosystem’s vibrancy. This grant size is carefully calculated, considering the amount of volume that we aim to achieve during the grant period and the rebate that we are offering to traders. We believe before the end of the grant period, we will be able to distribute the grant amount back to the Arbitrum community.

Grant Breakdown:
60% LTIP Grant (90,0000) is focused on providing full trading fee rebates for selected pairs (our trading fee is 0.05%)

Selected Pairs

  • BTC/USDC
  • ARB/USDC
  • ETH/USDC

40% LTIP Grant (50,000) will be allocated to provide gas fee rebates for traders and LPs.

Funding Address: 0x267F1B3CFFC54561d4180e7DBFcFE86C6Aa00677

Funding Address Characteristics: Multisig 3/5

Treasury Address: Prefer not to disclose

SECTION 4: GRANT OBJECTIVES, EXECUTION AND MILESTONES

Objectives:
We want to leverage the LTIP grant to make SynFutures a hub for derivatives trading on Arbitrum. Especially for trending long-tailed assets.

  • Accelerate user adoption by bringing in new users who are interested in trading derivatives of trending tokens.
  • Provide opportunities for the Arbitrum community to trade perps of assets from other chains more quickly and easily.
  • Cement Arbitrum’s role as the chain for derivatives

Execution Strategy
The allocation of resources for SynFutures on Arbitrum is strategically designed to maximize engagement, enhance liquidity, and promote sustained user participation. Our execution strategy encompasses five key components, each tailored to foster a vibrant and dynamic trading environment on the Arbitrum network.

  • Arbitrum-Focused Trading Fee Rebates (60%): To incentivize trading on the platform, we plan to offer a 100% trading fee rebate. The plan is to encourage users to trade without any concern for trading or gas fees.
  • Arbitrum focused Gas Fee Rebates (40%): By offering significant rebates on gas fees, we aim to make trading on our platform more accessible and cost-effective, attracting a broader user base and increasing trading activity. This, in turn, enhances liquidity and fosters a vibrant trading ecosystem on Arbitrum.

What mechanisms within the incentive design will you implement to incentivize “stickiness” whether it be users, liquidity, or some other targeted metric? [Provide relevant design and implementation details]

The initial LTIP grant will be used to incentivize users to try our product and understand its ease of use, both from a trading and liquidity provision perspective. After the grant timeline, SynFutures will run regular promotional campaigns from time to time to attract more users. Once users become familiar with the platform, LPs would be able to use its permissionless feature to list new and emerging tokens and earn high fees, while traders would have the option to trade trending tokens. We believe this would become a sustainable model of user interaction that doesn’t require constant incentives.

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:

In line with our main focus, we are setting specific KPIs centered around trading volume to assess the effectiveness of our execution. We believe boosting the volume would be the first step towards establishing SynFutures as a major derivatives platform that the Arbitrum community can depend on for trading new and interesting assets. Our goal is to achieve 360 million USD in trading volume over the grant period. The exact break up is mentioned in the next section.

Grant Timeline and Milestones

Week 1-4: Initial Setup and Launch

Milestone: Successfully launch all planned initiatives and promote them across different social platforms.

KPIs: Achieve a total trading volume of at least 100 million during this phase.

Week 4-8: Engagement and Growth Evaluation

Milestone: Actively engage with the community and evaluate their feedback to enhance our protocol.

KPIs: Achieve a trading volume of at least 120 million for this phase and a total trading volume of 220 million

Week 7-12: Liquidity and Community Building

Milestone: Run more initiatives and promotional campaigns aimed at growing the user base.

KPI: Achieve a trading volume of at least 140 million for this phase bringing the total trading volume to $360 million.

How will receiving a grant enable you to foster growth or innovation within the Arbitrum ecosystem?

Many crypto traders are drawn to trading new and emerging tokens, which currently occurs across various chains leading to fragmentation. Often, perps of a trending token are traded mostly on the native chain of that specific token. SynFutures plans to change that by offering LPs an easy and permissionless trading system. If a new token starts trending, irrespective of the chain, any LP could list a perp of that token on SynFutures by providing single-token liquidity. We believe this will reduce the number of traders moving from Arbitrum to other chains just to trade such tokens. It will also reinforce Arbitrum as the top chain for derivatives trading.

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

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.

Does your team agree to provide bi-weekly program updates on the Arbitrum Forum thread that reference your OBL dashboard?

Yes.

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

[Withdrawn notice]
Hi team, after internal discussion, we decided that we will reserve our application for the next Grant due to the current capacity. We’ll get back with a clearer plan/ proposal when the time comes. And of course we appreciate all your efforts with us during the whole process. Wish you all the best and hope to work with you next time. @cliffton.eth

1 Like

Hello @Hurcan

Thank you for your application! We can confirm your application has been submitted and you will be assigned an advisor shortly.

Hello @Hurcan ,

Thank you for your application! Your advisor will be @JoJo.

Please join the LTIPP discord and ping your advisor in the general chat so they can create a new channel and start communicating with you.

[Withdrawn notice]

Hi team, after internal discussion, we decided that we will reserve our application for the next Grant due to the current capacity. We’ll get back with a clearer plan/ proposal when the time comes. And of course we appreciate all your efforts with us during the whole process. Wish you all the best and hope to work with you next time. @cliffton.eth