This proposal aims to extend support to Untangled RWA lending pools on Celo by allocating the CELO-equivalent of $200,000 as a grant from the Celo Community Fund (CCF) for protocol maintenance and the establishment of a legal structure and monitoring dashboard for Real World Assets (RWA) lending on Celo.
All these pools are rigorously vetted and co-invested by an UK-based, FCA-regulated institutional asset manager.
Our primary objective is to offer RWA yield opportunities to the Community Fund and other investors within the ecosystem. As the initial step, we prioritize establishing a solid foundation for launching and maintaining RWA lending pools within the Celo ecosystem.
We are seeking a $200,000 worth of CELO grant from the Celo Community Fund (CCF) for the following purposes:
- $75,000 will be allocated to a one-year maintenance of the protocol on Celo.
- $50,000 will be designated for setting up a legal structure that will enable the CCF to lend to Untangled pools and similar real-world lending projects.
- $75,000 will be used for setting up a framework for on-chain monitoring of real world lending exposures
|Hours per day||8|
|Tasks||Engineering days||Total costs|
|Cross chain communication|
|Receiver/Sender contract development and deployment||5||$4,000|
|Integrate contracts to business logics||5||$4,000|
|Cross chain messaging use case (i.e. no token transfer)||5||$4,000|
|Cross chain token transfer (mint/burn, lock/burn) use case||5||$4,000|
|BE and subgraph modifications||5||$4,000|
|USDC/cUSD swap (embed Squidrouter)||5||$4,000|
|cUSD/Fiat bridge (working with Mento)||5||$4,000|
|Audit of cross chain communication code||$15,000|
|Security incidents/improvements of the protocol||15||$12,000|
|Bug bounty costs||$16,000|
|Legal||Contribution to legal expenses:||$50,000|
|Legal structure comparisons||$10,000|
|Legal entiry set up||$10,000|
|Independent director fee - first year||$10,000|
|Audit - first year||$10,000|
|Legal opinion on CCF’s enforcement claim||$10,000|
|Reporting asset tracking||$75,000|
|Data stream from originators|
|API build and test for initial data upload||2||$1,600|
|API build and test for on data update||3||$2,400|
|Implement independent validation flow||10||$8,000|
|Borrowing and lending data from subgraphs||18.75||$15,000|
|Data preparating and feature engineering||5||$4,000|
|Modelling PD for address on Celo and xchain||20||$16,000|
|Reporting and tracking dashboard|
|Update subgraph, API||5||$4,000|
|Set up automatic tracking of covernants, collateral performance||10||$8,000|
|Design and build dashboard for Untangled pool on Celo||20||$16,000|
- The protocol has been successfully deployed on the Celo mainnet, including all relevant contracts. A comprehensive audit has been conducted before the mainnet deployment, and an audit report is available here.
- We will provide a budget for ongoing protocol maintenance.
- Completion of the legal structuring exercise, including appropriate jurisdiction and legal structure.
- Framework for a robust on-chain monitoring and reporting system, including a dashboard facilitating timely remedial actions in the event of a credit event.
Milestone 1: For fund withdrawal, we will comment on the forum post, indicating the amount of CELO tokens swapped for $200,000 USD. We will also set out a final budget for ongoing protocol maintenance.
Milestone 2: Regarding the legal structuring, once completed, the legal structure will be made available in a forum post, including legal entities and documentation.
Milestone 3: A forum post on the RWA credit monitoring framework and a dashboard will be provided (see attachment for details).
Credit/Counterparty Risk: This is the risk that counterparties of underlying credit exposures may fail to repay the lending pool. We mitigate this risk through various means:
- Many upcoming pools on Celo are co-invested by funds managed by the above-mentioned regulated asset manager, which has thoroughly vetted the asset originators with a strong repayment track record.
- Untangled Finance, the developer of the Untangled protocol, is actively developing machine learning-based credit models that predict the probability of defaults and expected losses based on both portfolio and non-portfolio data.
- RWA credit on-chain monitoring is being built as mentioned above.
Legal/Regulatory Risk: Ensuring clarity, transparency, and familiarity for investors in the legal construct is crucial, from the legal relationship of the investor to the structuring of off-chain legal entities. This aspect will be addressed through the legal structuring exercise.
Smart Contract Risks: The latest deployment has undergone an audit by Verilog. You can find the audit report here.
To facilitate the withdrawal of $200,000 worth of CELO. Any unutilized CELO for the legal structuring workstream will be returned to the community fund.
A multisig wallet hosted on Safe will be employed to manage and deploy the funds, requiring a 2 of 3 signature threshold. The multisig wallet is at 0xE35A476Ac46c34C15d90C6b2efd3FAFAFB815BeB and can be found here. The signers for this multisig are:
- Manrui Tang (Untangled)
- Isha Vashney (Celo community member)
This post has been updated for detailed budget.