Please describe your proposed solution

Our solution consists of a staking platform built on Cardano's sidechain Milkomeda. This staking platform will have:

1 - A staking vault creation page, where anyone will be able to create a staking vault for any token, let's say XYZ for the sake of example, permissionlessly.

2 - A vault page that, given a vault for some token XYZ, allows users to stake XYZ into the vault and later unstake XYZ from the vault.

3 - A reward distribution feature, that will allow any XYZ holder (including possibly the core team behind the XYZ project) to distribute rewards to the XYZ stakers.

When users stake XYZ, they receive a liquid accruing hodlXYZ token. When they unstake, they must pay an unstaking fee that is automatically distributed as rewards for those who continue staking.

We have proven (see: https://eprint.iacr.org/2023/1029.pdf) that the price of hodlXYZ always goes up w.r.t. the price of XYZ, and this serves as an additional incentive for users to stake.

To know more what this video:

https://www.youtube.com/watch?v=D7L7h7EOIow&t=8sWe chose to build on Cardano via Milkomeda, because it is easier to ensure that the unstaking fee gets paid also when users transfer hodlXYZ tokens.

We have already built hodlERG on Ergo and hodlALPH on Alephium. And now it is time to bring our protocol to Cardano, and for all tokens on Cardano.

Please define the positive impact your project will have on the wider Cardano community

Our hodlCoin staking platform will allow any token-based project on Cardano to create a no-code staking vault for their token.

This will allow them to reduce the circulating supply of their tokens thereby leading to greater TVLs and positive price impacts for all those projects.

What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

We have already built hodlCoin for Ergo and Alephium. See https://hodlcoin.co.in . And we have already built Djed on Milkomeda. This shows that we can deliver this project. We have both the research knowledge of our own protocol and the skills needed to build on Cardano's EVM sidechain.

• Dr. Bruno Woltzenlogel Paleo (Zahnentferner) has been the Director of Engineering for IOG and has been responsible for designing Cardano's native multi-assets approach, allowing anyone to launch tokens on Cardano. The hodlCoin Staking Platform is the next logical step in his personal mission to empowering people to launch their own currencies, as it will give them the tools to manage their tokens circulating supply towards greater stability. Bruno is also a member of the original team who did the R&D for the Djed Stablecoin protocol, he is a founder of the Djed Alliance, The Stable Order and the Stability Nexus and the founder of AOSSIE, a not-for-profit charity registered in Australia dedicated to open-source software innovation and education. Throughout his career, his research and development projects have received millions of dollars from sources such as various national research agencies, Catalyst and Google.

• Luiz Vasconcelos Junior: Graduating in Computer Engineering in the Technological Institute of Aeronautics (ITA, Brazil) - class of 2024. Previous work include equity research in a Brazilian hedge fund (2021 - 2022) and responsible for Blockchain and tokenization in a Brazilian fintech unicorn (2023). In 2024, participated in the Polkadot Blockchain Academy in Hong Kong as a founder and was graduated with distinction (4 out of 35 founders). Hackathon winnings include 1st place in DeFi in Zencon 2023, XDC Network 1st place bounty in ETHDenver 2024, 1st place BNBChain hackathon in Brazil, 2022.

• <https://github.com/luiz-lvj>

• Bryan Diniz Borck: graduating in Computer Engineering from the Technological Institute of Aeronautics (ITA, Brazil) - class of 2024. My previous work includes equity research at one of the largest Brazilian hedge funds (2022 - 2023). I achieved a top 5 placement in the Brazilian University Mathematics Olympiad (2022). In 2024, I participated in the Polkadot Blockchain Academy in Hong Kong as a developer, focusing on Rust and Substrate. My hackathon achievements include 1st place in DeFi at Zencon 2023, 1st place in the XDC Network bounty at ETHDenver 2024, and 1st place in the BNBChain hackathon in Brazil in 2022.

• <https://github.com/BryanBorck>

Note: ITA is the top university for engineering in Brazil. Acceptance rate is around only 1.5% and ITA's graduation in Computer Engineering is regularly ranked the top course at the ENADE ranking by Brazil's Ministry of Education (https://comp.ita.br/noticias/2020/10/22/Enade-Eng-Comp.html)

What are the key milestones you need to achieve in order to complete your project successfully?

Milestone 1: Milestone Output: hodlcoin smart contracts implemented in Solidity.

Acceptance Criterion: the smart contracts should be compilable without errors.

Evidence of milestone completion: we will provide a link to the smart contracts source code to the reviewers.

Estimated length: 1 month.

Milestone 2: Milestone Output: frontend page for interaction with a hodlcoin staking vault.

Acceptance Criterion: the frontend page should be running at least on a testnet.

Evidence of Milestone Completion: we will provide screenshots as well as a link to the frontend page that the reviewers could use.

Estimated length: 1 month.

Final Milestone: Milestone Output: frontend page for vault creation.

Acceptance Criterion: the frontend page should be running at least on a testnet.

Evidence of Milestone Completion: we will provide screenshots as well as a link to the frontend page that the reviewers could use.

Estimated length: 1 month.

Who is in the project team and what are their roles?

• Dr. Bruno Woltzenlogel Paleo - researcher, protocol engineer, inventor of the hodlCoin protocol and project manager.

• Luiz Vasconcelos Junior: smart contract software engineer.

• Bryan Diniz Borck: frontend software engineer.

Please provide a cost breakdown of the proposed work and resources

Assumption: 1 ADA = 0.4 USD .

According to Indeed (https://www.indeed.com/career/software-engineer/salaries), the average base salary of a software engineer, excluding benefits is 22000 ADA per month. 3 engineers for 3 months would cost, on average, 3 x 3 x 22000 ADA, which is equal to 198000 ADA. We are requesting only 100000 ADA, which is the maximum amount in the concept category. All money will be used for R&amp;D of the proof of concept.

No dependencies.

How does the cost of the project represent value for money for the Cardano ecosystem?

As explained in the budget section, we are requesting funds to cover only about half of the R&amp;D cost that we estimate to have with this project. The other half we will cover on our own. Therefore, this is good value for money, because Cardano will have a token staking platform for half of the price that it costs.

Furthermore, the main value provided to the Cardano ecosystem by the project can be expected to greatly surpass its development cost. This project enables people to create staking vaults and stake their tokens with a no-code platform. This increases TVL and increases prices across the Cardano ecosystem. Although this effect is difficult to quantify, it is plausible that the token price increases alone would bring more than 100000 ADA worth in value back to the Cardano community.