KIP-60: Lyra Hosting Pilot

Summary

This KIP agrees to the terms defined in LEAP-43 approved by the Lyra Council, and proposed by the Kwenta DAO.

Abstract

Kwenta will be the first third party interface deployer of the Lyra protocol. This will involve Kwenta hosting its own interface (the Kwenta Interface) that provides users with access to trade Lyra protocol sourced options for the 6-month pilot period .

Motivation

Kwenta has a goal of becoming The Defi Trading Hub, and the first step is to integrate Options Trading. Lyra Finance is the obvious choice to integrate with.

The Lyra protocol provides users with infrastructure to build and trade options. The Lyra DAO is focussed on back end development and support for clients building and hosting interfaces to access the Lyra protocol.

In traditional finance, options trading is typically offered as a component of a suite of spot and derivatives trading tools and access to a broader range of financial instruments. However, the Lyra interface (as currently implemented) only provides a single venue for creating and trading options. There is an opportunity to expand the reach and use of the Lyra protocol by offering access to clients who can build tailored interfaces facilitating access to the Lyra protocol and offer trading activities together with other financial products and services not built on the Lyra protocol.

Kwenta is a project focused on providing a user interface and tool suite to customers for a range of spot and derivatives offerings on Optimism. Kwenta is proposed as the first (pilot) user proposing to build and host an options trading interface. Providing third parties with access to the Lyra protocol and liquidity to support their product offerings will allow Lyra to maintain its core focus of growing a strong backend system rather than compete against providers that offer a range of financial services and instruments.

Specification

During the Pilot:

Lyra will provide Kwenta with:

• Access to the Lyra interface to develop and host its own interface (the Kwenta Interface);
• Access to the Lyra protocol to support the Kwenta Interface;
• A grant of 400,000 LYRA to undertake the Pilot, to be paid linearly in monthly installments (subject to Lyra DAO review throughout the Pilot);

Support from Lyra DAO Core Contributors, including weekly meetings, open ended sync communications channels and technical support for disruptions between Kwenta Interface and the Lyra protocol.

Kwenta will:

• Develop and host the Kwenta Interface to be made available to Kwenta users on the Kwenta exchange (kwenta.eth.limo);
• Deploy the Kwenta Interface to provide users with access to Lyra sourced options only;
• Not charge any additional fees to users accessing the Lyra protocol through the Kwenta Interface;
• Not in any way indicate that it can bind Lyra DAO;
• Only deal with the LYRA tokens provided in connection with the Pilot through staking, and will not ‘dump sell’ any LYRA tokens;

Prior to the end of the Pilot period, develop a subsequent LEAP proposing the terms of any ongoing commercial arrangement between Kwenta and Lyra with respect to the Kwenta Interface.

This arrangement is not intended to be exclusive and Lyra DAO may provide services to other parties providing interfaces with Lyra protocol. If engagement during the Pilot indicates that a longer term commercial arrangement with Lyra is not in the best interests of Kwenta, a disengagement plan will be agreed upon and implemented.

Copyright

Copyright and related rights waived via CC0.