From 17412676b35171912a488ff3298b7f5b7d1d3288 Mon Sep 17 00:00:00 2001 From: bt3gl <1130416+bt3gl@users.noreply.github.com> Date: Sun, 27 Mar 2022 18:58:41 +0100 Subject: [PATCH] Update README.md --- keeperDAO/README.md | 86 +++++++++++++++++++++++++++++++++++++++++++-- 1 file changed, 84 insertions(+), 2 deletions(-) diff --git a/keeperDAO/README.md b/keeperDAO/README.md index c741511..e0957c0 100644 --- a/keeperDAO/README.md +++ b/keeperDAO/README.md @@ -30,10 +30,92 @@ We’re backed by some of the most reputed investors in web3: Three Arrows Capit ♜ ``` + + +--- + +## Core Products +
+### The Hiding Game -#### Projects of interest +* Gasless limit order system that sources liquidity from all means supported by KeeperDAO Keepers. +* If a user's order creates a MEV opportunity, the user will be reward with a share of the MEV profits in the form of ROOK. + +### The Hiding Vault + +A generalized liquidation-mitigation lending and borrowing NFT product. +* The first platform supported by Hiding Vaults is Compound Finance. +* Using a Hiding Vault mitigates both the risks and the impacts of the liquidation of users using Compound Finance. +* If a user's position is liquidated, the user will be reimbursed with a share of the liquidation profits in the form of ROOK. + +### Liquidity Pools + +* KeeperDAO offer five single-asset LP that yield ROOK tokens (ETH, WETH, USDC, renBTC, and DAI): users earn ROOK rewards based on the number of ROOK rewards allocated to the pool each quarter. + + +
+ +--- + +## MEV + +
+ +### How the blockchain works +* Each block in the blockchain contains a list of transactions in a particular order, enconding a sequence of updates to the blockchain sate (world state). +* Anyone can broadcast a transaction to the network, which means that the transaction is public. A broadcast is a request. In order for that request to be carried out, someone must place the transaction in a block and add the block to the blockchain. +* Anyone can listen for transactions being broadcast and gather them into a list. In order to a turn a list into a block, it needs to be validated. Validation creats a mathematical (cryptographic) proof that the state changes are consistent. +* In a proof-of-work blockchain, block producers are miners. In a proof-of-stake blockchain, they are validators. +* The act of converting a transaction into a block is called *settlement*. The process of block production is called *settlement layer* or *consensus layer*. + +### Arbritage opportunity + +* Results from a difference in prices between the same asset, listed on different DEXes. +* A transaction that makes the right swaps along the right arbritage route will end up with profit. + + +### Keepers + +* Bots that observe Ethereum, and other blockchains, to faciliate sorts of transactions, such as arbitrage, liquidations, auctions. +* Automated agents that survey the state of the blockchain and compute all the different possibilitie in order to identifty transactions that can create profit. +* Once Keepers have identified a valuable transaction, they will broadcast that to the network. Other keepers can copy and broadcast the same transaction with themselves as the originators. +* MEV arises from the problem of "how can a keeper ensure that they are the one who gets a transaction settled first? +* Keepers compete with each other in a zero-sum game, transforming Ethereum into a highly zero-sum game. +* Inside KeeperDAO, keepers don't need to compete - but coordinate and capture on-chain profits efficiently. DeFi users, protocols, market makers can bring their activity to KeeperDAO and gain a portion of the profits as a reward. + + +### Maximal extractable value + +* Refers to profit that can be extracted from a transaction from the transaction originator needing priority or control over the ordering of that transacion in a block (*the arbitrage has 45 WETH of MEV*). +* [As may of 2021, around $3-4mil of MEV is being captured daily](https://explore.flashbots.net/). +* MEV exists on any blockchain and layers where there is a party responsible for transaction ordering (eg. validators, rollup providers). +* Extracted MEV = Successful MEV transactions + Successful MEV transactions gas fees + Failed MEV transactions gas fees + +
+ +### ➡️ While it seems simple, MEV poses risks not only to the user but also to the consensus layer itself. The reorganisation of blocks, the reordering of transactions, and — even momentarily — the censorship of transactions can have profound impacts on the blockchain and breaks the assumptions of many applications. + +### ➡️ Because block producers are able to prioritize transactions with higher gas fees, a bidding war between bots (who either try to arbitrage or front-run) can occur. This hurts ordinary users and DeFi platforms, because these bidding wars drive up gas fees (Priority Gas Auctions) and cause slippage and failed transactions + + +### MEV strategies + +* Common MEV strategies are front-running, back-running, and sandwiching. +* MEV should accrue to the originator of the transaction, or of the transactions or protocols that create the MEV in the first place. +* Using KeeperDAO's **coordination layer**, we can capture and recycle the MEV before it can be extracted. + + + + +
+ +---- + +
+ +## Projects of interest * [KeeperDAO analytics](https://github.com/keeperdao/analytics) * [Keeper Improvement Proposals (KIPs)](https://github.com/keeperdao/kips) @@ -44,7 +126,7 @@ We’re backed by some of the most reputed investors in web3: Three Arrows Capit
-#### Documents of interest +## Documents of interest * [docs page](https://docs.keeperdao.com/reference/)