How does the Metera Protocol V.1 works?

This section of the V.1 of the protocol resumes the design of the Metera Protocol function.

To have a more detail explanation on how does the V.1 works, head over to Minting an MTK section.

The V.1 Smart Contract version was developed alongside TxPipe Shops.

Key V.1 points:

  • Portfolio Creation and Management:

    • Portfolio Manager (PM) creates a new portfolio with chosen tokens and their weights.

    • PM sets the amount of MTK tokens to be minted upon portfolio creation.

    • PM specifies portfolio settings and strategy.

    • Initially, the site admin acts as the PM, but the smart contract allows any user to create a portfolio.

    • PM can update portfolio settings, including target weights for tokens.

  • Interactions with the Portfolio:

    • Users can deposit or withdraw tokens by placing orders.

    • Orders are processed sequentially by the portfolio admin.

    • PM orders have priority over user orders and are processed immediately upon creation.

    • Users specify Lovelace price of tokens in their orders.

    • A fee is charged to users for deposits, paid in MTK when orders are processed.

    • Fees are stored in the portfolio for later collection by the PM.

  • Order Processing:

    • Deposits result in tokens being deposited into the portfolio and MTK being minted.

    • Withdrawals involve burning MTK and paying out tokens from the portfolio.

    • Orders include slippage tolerance to account for potential deviations in payout estimations.

    • Users can cancel orders before processing and receive back their deposited tokens.

  • Portfolio Rebalancing:

    • Fluctuations in token prices or changes in target weights may lead to portfolio imbalances.

    • User deposits and withdrawals are calculated to approximate target weights.

    • PM can place update orders to adjust target weights and rebalance the portfolio.

  • Fee Collection:

    • PM can initiate a collect order to claim accumulated fees in the portfolio.

    • Once processed, fees are paid out to the PM's address.

*** Please keep in mind this document is a work in progress, things may change as the project evolves ***

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