Merlin Protocol
  • Merlin Protocol
    • Intro
    • 0. Abstract - Features Implemented at the Choice of the DAO
    • 1. Decentralization and DeFi
      • 1.1 Features implementable at the choice of MerlinDAO
      • 1.2 Computer system
      • 1.3 Onchain Vs Offchain
      • 1.4 Risk Management
    • 2. The Merlin token, the MerlinDAO and future scenarios
      • 2.1 Merlin token (MRN)
      • 2.2 Merlin DAO
      • 2.3 Scenario of possible monetization of the MerlinProtocol
        • 2.3.1 Liquidity in the Liquidity Pool, Token Buyback and Burning
        • 2.3.2 The types of commissions that end up in the Liquidity Pools
      • 2.4 Staking
      • 2.5 Tokenomics
    • 3. Funds
      • 3.1 Top Cap
      • 3.2 Middle Cap
      • 3.3 Thematic Baskets
      • 3.4 Basket managed directly by MerlinDAO
      • 3.5 Index managed by AI
    • 4. How to use WebAPP to create and invest in TokenXFund decentralized funds
      • 4.1 Aladin fund creator user
        • 4.1.1 Use Case UCF1
      • 4.2 User investor of a fund
        • 4.2.1 Use Case UIF1
        • 4.2.2 Example: UIF1 use case
        • 4.2.3 UIF2 use case
        • 4.2.4 Example: UIF2 use case
    • 5. The creation and management of managed funds
      • 5.1 Active management
      • 5.2 Performance and benchmark
      • 5.3 Performance fees
      • 5.4 Ranking of Managed Funds
    • 6. Tokens to invest in
      • 6.1 The selection criteria for big and mid cap tokens
      • 6.2 Selection criteria for small and micro caps and ranking of tokens to put in portfolios
      • 6.3 Portfolio Composition Limits
    • 7. Oracles
      • 7.1 Decentralized Oracles
      • 7.2 Oracle design pattern
      • 7.3 ChainLink oracles —> (ChainLink Docs)
      • 7.4 Decentralized Data Model
      • 7.5 Data Security
      • 7.6 Uniswap v3 Pricing Oracles —> (Uniswap V3 whitepaper)
      • 7.7 Random Number Generator Oracles
    • 8. Swapping for fund rebalancing
      • 8.1 What is a Swap and why to Swap
      • 8.2 How to Swap
      • 8.3 When to Swap
      • 8.4 Javascript SDK for Uniswap v3
      • 8.5 DEX Expansion
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  1. Merlin Protocol
  2. 1. Decentralization and DeFi

1.3 Onchain Vs Offchain

The computer system is composed of different parts, some localized onchain and some more traditional offchain. The onchain parts are the Smart Contracts of the various funds created by the end users of the information system, the Smart Contract that collects fees from the various funds to feed them back into the Liquidity Pools, and the interaction with a decentralized third party exchange unrelated to this project. The Smart Contracts also rely on third party solutions for the retrieval of data relevant to the crypto market and randomization functions through oracle services. They also offchain the web app that can be used by users of the IT platform to create customizable investment funds (features that can be implemented by the MerlinDAO) and modify their basic parameters in the initial setup phase.

It should be noted that, although part of the architecture of the computer system is onchain and therefore theoretically replicable by third parties, the substantial part of the offchain system composed of oracles and the webapp will be protected from this eventuality. In fact, only the code on the Smart Contracts can be "forked", but the proprietary code of oracles and webapp will soon be copyrighted to protect the project.

It is important to note that the governance action of the MerlinDAO is limited to the computer system of creation of investment funds but will have no control over individual funds, their governance or the amounts deposited on them. In the case of the DeFi product buying and selling decision models implemented by individual funds, the MerlinDAO will manage the project in a decentralized manner by making available to fund creator users a set of fund composition rebalancing models based on data provided by non-proprietary oracles, but the final choice of which of these models to implement will rest with the fund creator user. This course of action will ensure greater control over the validity of the proposed tools and oracles in order to prevent misuse of the protocol by malicious actors.

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Last updated 2 years ago