[RFP]: A No loss Autonomous Custodial Lottery (Become a KUSD Millionaire)

[porkchop315]

Proposal Due Date

2/01/2025

Proposal Overview

The proposal introduces a no loss custodial lottery within the SORA ecosystem where participants deposit XOR tokens into a 15-day locked staking pool. Upon initial deposit, a percentage of the XOR tokens are burnt, and participants receive an NFT (PLOTTO) as their lottery ticket. At the end of each drawing, participants must burn their NFT to claim 84.1% of the prize pool. The remaining 15.9% rolls into a jackpot, which is awarded every six months. To be entered into the jackpot rounds, participants must have kept their NFT and their funds in the staking pool for 180 days. If participants do not burn their NFT, they are automatically re-entered into the next staking round and can claim yield paid in KUSD every 15 days. Additionally, the PLOTTO NFT can be sold on secondary markets, with time credit and staking funds transferred to the new owner. The PLOTTO NFT can also be fractionalized, allowing multiple users to own a percentage of the NFT and share in any prize pool winnings and unstaked earnings.

Lottery Mechanics

Initial Deposit and Burn:

Participants deposit XOR tokens into a 15-day locked staking pool.
A percentage of the deposited XOR tokens is burnt upon deposit.
Participants receive an NFT (PLOTTO) as their lottery ticket.

Prize Pool Distribution:

At the end of each 15 day period, the prize pool is distributed.
Winners burn their NFTs to claim 84.1% of the prize pool.
The remaining 15.9% of the prize pool rolls over into a jackpot.

Jackpot and Re entry:

The jackpot is drawn every six months.
Participants must have kept their NFT and funds in the staking pool for 180 days to qualify for the jackpot round.
Participants who keep their NFTs and funds in the staking pool are automatically re-entered into the next round.
Yield is paid in KUSD every 15 days for participants who remain in the pool.

Prize Tiers:

Basic Prize Pool: 100,000 XOR tokens (Per token NFT PLOTTO)
Bronze Level: 1,000,000 XOR tokens (Per token NFT PLOTTO)
Silver Level: 10,000,000 XOR tokens (Per token NFT PLOTTO)
Gold Level: 100,000,000 XOR tokens (Per token NFT PLOTTO)
Diamond Level Jackpot: Accumulated from each tier’s 15.9% prize pool roll over, drawn every six months.

NFT Secondary Market:

PLOTTO NFTs can be sold on secondary markets.
Time credit and the ability to claim staking funds are transferred to the new owner.
PLOTTO NFTs can be fractionalized, allowing multiple users to own a percentage of the NFT.
Fractional owners share in any prize pool winnings and unstaked earnings proportional to their ownership.

Integration and Functionality

Blockchain and NFT Integration:

The lottery system leverages smart contracts for secure and transparent transactions.
NFTs are issued to participants as immutable lottery tickets.

Yield Generation:

Funds from the jackpot pools are lent out to high yielding protocols like AAVE, Compound, or Polkaswap exclusive products and services.
An auto stop mechanism is in place to withdraw funds if APYs fall below a certain threshold to protect the lottery funds.

No Loss Mechanism:

Users cannot lose their initial deposit, encouraging savings and investment.
Participants can increase their chances of winning by depositing more funds.

Benefits to the SORA Ecosystem

Token Burn:

Regular burning of XOR tokens reduces the total supply, increasing scarcity and potentially driving up the token’s value.
Increased Participation:

The lottery system attracts participants by offering a no loss opportunity with the potential for high rewards.

Enhanced Liquidity:

Deposits in the staking pools enhance the liquidity of XOR tokens within the ecosystem.

Partnerships and Yield:

By partnering with high yield platforms, the SORA ecosystem can generate additional revenue and offer attractive rewards to participants.

Differentiation from Existing Solutions

No Loss Mechanism:

Unlike traditional lotteries, participants do not lose their initial funds , making it a safer and more attractive option.

NFT Integration:

The use of NFTs as lottery tickets introduces a novel and secure way to track participation and rewards.

Automated Re-entry:

Participants who do not burn their NFTs are automatically re-entered into the next round, encouraging long term participation.

Secondary Market and Fractional Ownership:

PLOTTO NFTs can be traded on secondary markets, with time credit and staking funds transferred to new owners.
NFTs can be fractionalized, allowing multiple users to share in the benefits of ownership.
Implementation Steps and Scope

Smart Contract Development:

Develop and audit smart contracts for the staking pool, NFT issuance, prize distribution, and jackpot mechanism.

NFT Creation:

Design and mint NFTs to be used as lottery tickets.

Platform Integration:

Integrate the lottery system with the SORA platform, ensuring seamless user experience and functionality.

Yield Optimization:

Partner with high yield platforms and implement the auto stop mechanism to protect funds.

User Interface:

Develop an intuitive UI for users to participate in the lottery, track their NFTs, and claim rewards.

No_Loss_Lottery_Flow_Chart.pdf

Process Description

Deposit and Burn:

Users deposit XOR tokens into the staking pool.
A percentage of XOR tokens is burnt.

NFT Issuance:

Users receive NFTs (PLOTTO) as lottery tickets.

Prize Distribution:

Prize pool is distributed every 15 days.
Users burn NFTs to claim 84.1% of the prize pool.
15.9% of the prize pool rolls into the jackpot.
Jackpot Accumulation and Draw:

Accumulated jackpot is drawn every six months.
Users automatically re-enter the lottery if they keep their NFTs.
Users must have kept their NFT and funds in the staking pool for 180 days to qualify for the jackpot round.
Yield Generation:

Funds from the jackpot are lent to high yield platforms.
Yield is paid in KUSD every 15 days.
Secondary Market and Fractional Ownership:

NFTs can be traded on secondary markets.
Time credit and staking funds are transferred to new owners.
Fractional ownership allows multiple users to share in winnings and earnings.
Unstaking Funds and Earned APY:

Users can burn the NFT to unstake their initial funds and any earned APY.

Notably, this gameplay does not constitute gambling, encouraging savings instead, which potentially removes the necessity for KYC, though always verify with local regulations.

Proposal Goals

The primary goal of the No Loss Autonomous Custodial Lottery proposal is to create an innovative and engaging financial product within the SORA ecosystem that promotes user engagement, increases XOR token utility, burning the token supply and encourages long term staking. By offering a unique lottery mechanism where participants cannot lose their principal but have the potential to win significant prizes, the proposal aims to attract and retain users, ultimately driving more activity and value to the SORA network.

Problem It Solves
Low User Engagement and Retention:

Problem: Traditional staking and savings products can often seem uninteresting and fail to engage users effectively, leading to low participation and retention rates.

Solution: By introducing a gamified, no loss lottery system, users are incentivized to participate and remain engaged, as they have the chance to win prizes without risking their initial investment.

Insufficient Utility for XOR Tokens:

Problem: Limited use cases for XOR tokens can hinder the growth and adoption of the SORA ecosystem.

Solution: This proposal enhances the utility of XOR tokens by incorporating them into an innovative financial product, thus increasing their demand and circulation within the ecosystem.

Lack of Long Term Staking Incentives:

Problem: Users may be reluctant to lock up their funds for extended periods due to the opportunity cost and lack of attractive incentives.

Solution: The lottery system encourages long term staking by offering periodic prize draws and additional rewards for users who keep their funds in the pool and their NFTs (PLOTTO), fostering a culture of sustained participation.

Burning Mechanism for XOR Tokens:

Problem: Managing and reducing the circulating supply of XOR tokens can be challenging due to such a high supply vs demand.

Solution: The proposal incorporates a burning mechanism where a percentage of XOR tokens are burnt upon initial deposit, contributing to a decrease in the circulating supply and potentially increasing the token's value over time.

Innovative Use of NFTs and Fractional Ownership:

Problem: The potential of NFTs and fractional ownership is underutilized in many blockchain ecosystems.

Solution: By issuing NFTs as lottery tickets and allowing their fractional ownership and secondary market trading, the proposal leverages the innovative aspects of NFTs, adding a new layer of value and engagement for users.

Enhanced Financial Inclusion:

Problem: Traditional financial products may exclude certain user groups due to high entry barriers or lack of understanding.

Solution: The no loss lottery is designed to be inclusive and straightforward, enabling broader participation across various user demographics, thus promoting financial inclusion.

Optimized Use of Idle Funds:

Problem: Idle funds in staking pools may not be utilized efficiently, leading to lower overall returns.

Solution: The proposal suggests lending out jackpot pools to high yielding platforms like AAVE, Compound, or Polkaswap, ensuring that the funds are actively generating returns, which can then be used to enhance the lottery rewards and the overall ecosystem.

Scope of Work

Implementing the No Loss Autonomous Custodial Lottery proposal into the SORA ecosystem involves several technical, operational, and community engagement steps. Here’s a detailed breakdown of the scope and amount of work required:

Technical Development
Smart Contract Development:

Lottery Pool Contract: Develop a smart contract to manage the 15 day locked staking pool, initial deposit handling, and prize pool distribution.
Burn Mechanism Contract: Implement a contract to burn a percentage of XOR tokens upon deposit.
NFT Issuance Contract: Create a contract to issue NFTs (PLOTTO) as lottery tickets and manage their metadata.
Prize Distribution Contract: Develop a contract to distribute prize pool funds and handle jackpot allocation.
Secondary Market and Fractional Ownership: Integrate contracts to enable secondary market trading and fractional ownership of NFTs.

Integration with Yield Generating Platforms:

Lending Integration: Integrate with platforms like AAVE, Compound, and Polkaswap to lend out jackpot pools and manage yield generation.
Auto Stop Loss Mechanism: Implement an automated system to halt staking on external platforms if APYs fall below a certain threshold.

User Interface and Experience:

Frontend Development: Build a user friendly interface for users to participate in the lottery, manage their NFTs, and track their potential earnings.
Dashboard and Analytics: Create a dashboard to display staking details, prize pools, and jackpot information.
Mobile Compatibility: Ensure the interface is mobile friendly to cater to a wider audience.

Security Audits:

Smart Contract Audits: Conduct thorough security audits of all smart contracts to prevent vulnerabilities.
Penetration Testing: Perform penetration testing on the platform to identify and mitigate potential security risks.

Marketing and Community Engagement:

Awareness Campaigns: Launch marketing campaigns to promote the lottery and educate users about its benefits.
Community Outreach: Engage with the SORA community through social media, forums, and webinars to gather feedback and build trust.

Timeline and Milestones
Phase 1: Planning and Design (1-2 months):

Define project requirements and specifications.
Design smart contract architecture and user interface.

Phase 2: Development and Testing (3-4 months):

Develop smart contracts and frontend interface.
Conduct internal testing and iterative improvements.

Phase 3: Security Audits and Compliance (1-2 months):

Perform security audits and address identified issues.
Ensure regulatory compliance and finalize legal documentation.

Phase 4: Launch and Marketing (1-2 months):

Launch the lottery system on the SORA platform.
Execute marketing campaigns and engage with the community.

Phase 5: Post Launch Support and Iteration (Ongoing):

Monitor system performance and user feedback.
Implement improvements and additional features based on user input.

Current Roadblocks and Barriers to Success

While the No Loss Autonomous Custodial Lottery proposal offers numerous benefits, there are several potential challenges and pitfalls to be aware of. Here are some key considerations to ensure a successful implementation:

Potential Challenges and Considerations
Security Risks:

Smart Contract Vulnerabilities: Smart contracts are susceptible to bugs and exploits. It's crucial to conduct thorough audits and continuously monitor for vulnerabilities.
Hacks and Exploits: The platform could be targeted by malicious actors. Implement robust security measures and contingency plans.

Market and Economic Risks:

Token Volatility: XOR and other cryptocurrencies can be highly volatile, affecting the value of staked funds and prize pools.
Interest Rate Fluctuations: Yield generating platforms like AAVE and Compound may experience fluctuating interest rates, impacting returns.

User Adoption and Retention:

User Trust: Building and maintaining user trust is essential. Transparent operations and clear communication are key.
Ease of Use: The platform must be user friendly to attract and retain participants. Complicated processes can deter users.

Technical Challenges:

Integration Complexities: Integrating with multiple external platforms (AAVE, Compound, etc.) can be technically challenging and require ongoing maintenance.
Scalability: Ensure the platform can handle a growing number of users and transactions without performance degradation.

Economic Design and Incentives:

Sustainable Incentives: Ensure the reward structure is sustainable and attractive to participants without depleting funds.
Fractional Ownership: Managing fractional ownership and secondary market trading of NFTs can be complex and requires careful design.

Key Areas of Focus

Robust Security Measures:

Conduct multiple rounds of smart contract audits by reputable firms.
There should be no owner or centralized authority over this smart contract.
Regularly update security protocols and conduct penetration testing.

Risk Management:

Use stablecoins or other mechanisms to mitigate token volatility.
Implement auto stop mechanisms for yield farming to prevent losses.
Diversify yield-generating strategies to manage risk

User Experience:

Design an intuitive and user friendly interface.
Provide detailed guides, tutorials, and customer support.
Engage with the community to gather feedback and make improvements.

Economic and Incentive Design:

Ensure the prize pool and jackpot structures are compelling yet sustainable.
Design fractional ownership and secondary market trading to be seamless and fair.
Consider implementing loyalty rewards or referral bonuses to encourage participation.

Transparency and Communication:

Maintain open communication channels with the community.
Regularly update users on platform developments and security measures.
Provide transparent reports on fund management and prize distribution.

Notably, this gameplay does not constitute gambling, encouraging savings instead, which potentially removes the necessity for KYC, though always verify with local regulations.

Evaluation Metrics and Criteria

CHECK LIST:

The lottery system is live on the SORA platform.
Smart contracts are audited and deployed.
NFTs are minted and distributed.
The prize pool and jackpot mechanisms are functional.
Users can participate, claim rewards, and re-enter seamlessly.
Yield generation mechanisms are in place and operational.
Success Criteria
Successful and secure deployment of smart contracts.
High user participation and engagement.
Regular burning of XOR tokens.
Positive feedback and user satisfaction.
Increased liquidity and value of XOR tokens.
Sustainable and profitable yield.

Submission Requirements

Smart Contract Development:

Develop and audit smart contracts for the staking pool, NFT issuance, prize distribution, and jackpot mechanism.
NFT Creation:

Design and mint NFTs to be used as lottery tickets.
Platform Integration:

Integrate the lottery system with the SORA platform, ensuring seamless user experience and functionality.
Yield Optimization:

Partner with high yield platforms and implement the auto stop mechanism to protect funds.
User Interface:

Develop an intuitive UI for users to participate in the lottery, track their NFTs, and claim rewards.

Submission Method

Blockchain: Mainnet

Project Due Date

03/15/2025

Budget Amount

This is up to the discretion if the development team.