New Year, New Protocol

Community Newsletter #27: January 2024

Embarking on the new year with steadfast momentum, we're thrilled to highlight two noteworthy development updates in the past month:

• Released technical documentation for peripheral contracts, which includes staking, auctioning, and reward distribution features

• With dependencies successfully cleared, the final strides toward mainnet involve testing mainnet deployment and ensuring seamless functionality across the system.

Technical Docs for Peripheral Contracts

The peripheral contracts will introduce several interesting features to the Increment protocol once it is deployed and integrated with the core protocol:

1) INCR and other allowlisted underlying token(s) can be staked in the safety module, serving as a safeguard against potential shortfall events while also offering stakers the opportunity to earn rewards. As a staker, you have four distinct actions beyond the standard ERC-20 token functionalities: stake, redeem, start cooldown, and claim rewards

See the complete user flows here: https://docs.increment.finance/developer-docs/guides/staking

2) In the rare event of a shortfall, governance has the authority to initiate an auction, selling a required portion of the staked funds. As an auction participant, you have two potential actions: buy lot(s) and complete an expired auction.

See the complete user flows here: https://docs.increment.finance/developer-docs/guides/staking#auctions

3) Given the pivotal role of liquidity providers in the protocol, they have the opportunity to accrue extra rewards beyond their standard trading fees. This can be achieved by invoking the `claimRewardsFor` function within the RewardDistributor contract. The quantity of rewards is contingent upon the volume of reward tokens present in the EcosystemReserve on zkSync Era.

The system can support more than one reward token. The speed of reward accrual for stakers is dependent on the reward distribution parameters set by governance.

See the complete user flows and reward distribution mechanisms here: https://docs.increment.finance/developer-docs/guides/liquidity-provision#claim-rewards

The security audit for the peripheral contracts is set to begin on February 12.

Dependencies Cleared, Final Strides to Mainnet

As of now, the deployment process on zkSync Era mainnet appears to be issue-free. 

However, comprehensive testing of the contracts' functionalities on zkSync Era, along with the setup of the entire system end-to-end, is still pending. Once it can be confirmed that all features are operating as intended, we will proceed with the official deployment on zkSync Era mainnet, in accordance with the community proposal that received majority votes back in November 2023: https://discourse.increment.finance/t/deploy-on-zksync-era/884

If things go smoothly, the official deployment of core contracts is scheduled in the coming weeks. Subsequently, the parameterization and proposal for the inaugural Perpetual market will be initiated for onchain voting and execution via Tally.

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Increment is a decentralized, algorithmic perpetual swaps protocol building on zkSync Era, featuring automatically concentrated liquidity, dynamic fees and parametrizable pools.

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