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Cardano M2 milestone #63

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4 of 5 tasks
serejke opened this issue Jul 28, 2023 · 0 comments
Open
4 of 5 tasks

Cardano M2 milestone #63

serejke opened this issue Jul 28, 2023 · 0 comments
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@serejke
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serejke commented Jul 28, 2023

Note: this is work in progress.

Overview

With the completed message plumbing for EVM <-> Cardano (#45 and #28),
the next logical step is to utilize the connectivity of the EVM and Cardano for the Khalani protocol.

USDC on Cardano

We'll start with the design and implementation of a USDC token on Cardano, supporting the following user stories:

  • "As a Cardano user, I want to bridge my Ethereum USDC to Cardano USDC"
  • "As a Cardano user, I want to exit my Cardano USDC tokens to Polygon USDT."

USDC token is a mint/burn token residing on Cardano:

  • When user bridges USDC from chain xyz, the USDC.xyz token is first traded to klnUSDC via CCLP pool (USDC.xyz/klnUSDC) or is aggregated with Liquidity Aggregator (USDC.eth -> klnUSDC). Then klnUSDC token is locked on Khalani chain, and the same amount of USDC token is minted on Cardano.
  • When user exits Cardano USDC to another chain, USDC on Cardano gets burned, klnUSDC token on Khalani chain gets unlocked, then klnUSDC is traded to any chain's USDC.xyz via CCLP and CALP pools. Then USDC.xyz is burned and the same amount of USDC tokens is minted on the target chain.

The Khalani protocol complexity resides on the Khalani chain. The end chains (Ethereum, Arbitrum, ... Cardano) only have "asset reserves" (to lock/burn or unlock/mint tokens). The actionable trading "payload" (swaps to be executed) is encoded to a message dispatched from an end chain to the Khalani chain via Khalani SDK.

Breakdown

Technical debt EVM <-> Cardano

@serejke serejke changed the title Cardano M2 milestone WIP: Cardano M2 milestone Jul 28, 2023
@serejke serejke added this to the Cardano USDC milestone Jul 28, 2023
@serejke serejke changed the title WIP: Cardano M2 milestone Cardano M2 milestone Aug 7, 2023
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