An overhaul of Nyan Funds Management
A centerpiece of the Nyan ecosystem is its Fund and how users can vote on what assets enter and exit the fund. This aspect was one of the first features developed for Nyan V1 and was also a main draw for those that found interest in Nyan. However, it remained one of the few aspects of the ecosystem without an update to streamline and simplify its use.
The Nyan Voting contracts are now receiving a update that will act as a complete overhaul of how users will manage funds and profit from Fund activity. The V1 voting system was complex and difficult to understand for those that weren’t well versed in smart contract terminology. This complexity created a barrier that limited the use of funds movement and essentially caused the fund to remain unprofitable for general Nyan participants.
With this new update to the voting system, the fund will no longer be managed by every single user in the ecosystem. Rather, the system will be switching to a managed model where elected “Fund Managers” will take the responsibility of making investments on behalf of the ecosystem as a whole.
Initially, there will be a maximum of 5 managers. Anyone can become a manager as long as they are staking a minimum of 2 Nyan-2 LP tokens.
These managers will come directly from the community and will be given large allowances to use for these investments. The trades, profits and losses that these managers generate will be publically tracked for all to see and their profits will be sent to Nyan LPers and holders as a reward in the form of ETH. The managers will also earn ETH from the profits they generate as well. 10% of the profit they generate to be exact.
Nyan LP’ers will act as overseers for the managers and be able to vote out the least profitable manager each month(in blocks). This will give LP’ers a level of control and responsibility in ensuring that those managing funds are actually doing their tasks properly.
How can funds be kept safe?
A standard issue in decentralized systems with elected centralized points is trust. In order to mitigate a possible scenario of a malicious manager, all funds that move out of the fund must go through approved contracts. For example, if a manager wished to swap ETH to a specific token on Uniswap, that ETH wouldn’t be sent to their personal wallet. It would be sent to a specific contract that interfaces with Uniswap on behalf of the manager. Additionally, those approved contracts would have their own sets of safety checks that to ensure funds can’t be siphoned in other ways. Using the Uniswap interfacer contract as an example again, only approved tokens can be used in a swap. This would eliminate the possibility of the manager swapping into a malicious token, and stealing funds through a rug pull. Managers may also vote to whitelist tokens through a majority vote.
How often can profits be taken?
Each manager will have autonomy in the assets they invest in and choice for when they wish to swap their investment back to ETH. When an investment is swapped back, the Voting smart contracts will automatically determine the profitability of the investment and immediately send the appropriate amounts to the proper places(Rewards contract, Nyan Fund, Manager, Dev fund). 50% of profits from a profitable investment will be used as rewards. In order to also protect the profitablilty of investments, public stoploss functions will also be included to allow the Nyan community to easily liquidate an investment that has fallen below its initial value used.
Being a good manager can easily turn it into a profitable source of income for the individual manager.
What protocols will be supported by the Voting system?
Any smart contract protocol can be integrated into the new management system by simply creating a new smart contract that interfaces with the requested protocol. Managers will then have to vote to whitelist the new contract. This introduces a level of modularity that will allow the fund to operate autonomously moving foward, without the requirement of a lead developer. The initial supported protocols will include: Uniswap, dYdX and dMex. Community members may also request contracts that they believe should be supported.
Will the V1 voting system still be functional?
No. The introduction of this new management system will retire the V1 voting interface. However, Nyan LP’ers will still be able to use the Easybid interface to create smaller token swaps using their LP as a collateral for any losses incurred.
Future ideas and updates
As we roll out this new direction, many updates and tweaks will also occur to ensure safety and profitablity. We will most likely see a push towards the creation of yield generating vaults that allow non-Nyan holders to park ETH in order to allow a manager to trade their assets for them. This direction would essentially introduce the concept of a multi-index fund for the Nyan ecosystem, allowing people to leave ETH with managers whose trading styles and portfolio structure appeal to them. Before all this however, the managers must prove that their trading ability is able to outperform ETH, BTC and the general cryptocurrency market.
The development of this update to the Nyan voting system will help the fund achieve its original goal of acting as a decentralized whale meant to get users profits. An update that has been long overdue.
