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Update pica-use-cases.md #3745

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125 changes: 38 additions & 87 deletions docs/docs/parachains/picasso/pica-use-cases.md
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# PICA use cases

PICA is the native token of the Picasso parachain.
We have made a concerted effort to ensure that the PICA token holds as much utility as possible by incorporating
various value accrual methods, governance features, and time-weighted benefits in the form of fNFTs.
While the PICA token provides the community a strong voice and rewards for participating within the ecosystem,
it is also fundamental for the operation of collators and oracles. Thus, the PICA token is fundamental for
governance, network usage, and the security of Picasso.

This means that Picasso serves the following functions within the ecosystem:

## Gas (network usage)

The PICA token is uniquely positioned as a gas token which sits at the center of Picasso as a cross-chain DeFi hub.
This means that PICA will not only be used for transactions on Picasso itself but will also be required for bridging
assets via Centauri, as well as cross-chain function calls via XCVM.
Additionally, PICA will also act as the gas token for the CosmWasm VM on Picasso.
Notably, in order to further support users from other ecosystems Picasso will offer a feature called “bring your own gas” (BYOG),
which will allow users to pay their gas fee in any supported tokens.

For example, after channels to Kusama and Statemine are opened,
any cross-chain XCMP transactions can choose which assets to use to pay for the transaction.
These tokens are then swapped for PICA under the hood,
allowing users and liquidity to flow seamlessly through Picasso regardless of what ecosystem they are arriving from.

The following is an example of fees for transferring some KSM from Karura using XCMP:

1. Fee on Karura for XCMP.
2. Fee for XCMP on Picasso. Consists of a base fee plus additional fees calculated dynamically for each instruction
3. Transaction fee on Picasso
4. DEX swap fee

All fees may change dynamically depending on network load and pool or protocol fee formulas.
The most fundamental factor for gas fees is the computational resources it consumes
which is represented as the transactions "weight".
The weight of a transaction is converted into an appropriate amount of PICA by the polynomial formula
which changes dynamically depending on the target load of the network.
This means as the usage of the chain increases towards maximum capacity, the price of a unit of weight increases as well.

## Oracle staking
Apollo is our permissionless, MEV-resistant oracle solution.
Anyone can run an oracle node on Picasso by providing a PICA stake.

## Collator staking
25% of fees on Picasso is distributed to collators, with the remaining 75% going directly to the community-governed treasury.
Collators on Picasso are required to put down a stake to produce blocks on our parachain, as with most proof of stake networks.

## Stake for xPICA: Financial NFTs

xPICA is PICA that has been staked for a financial NFT (fNFT).
fNFTs are a novel concept that provides a tradeable representation of a time-weighted staking position.
The benefits of time-weighted staking are increased rewards and governance power proportional to a specified lock period.
Upon locking, the PICA tokens themselves become non-transferable until the end of the lock period.
The fNFT then serves as a voucher, the holder of which can:

1. Benefit from the rewards associated with the staking position itself and redeem for the locked PICA at the end of the lock period
2. Or, should they choose, to trade the fNFT to exit their position early.
Thus allowing users to exit their position before their lock period expires,
transferring the benefits and ability to redeem the fNFT for PICA to the new holder.

## Primary pairing on Pablo

Pablo is the native DEX of the Picasso ecosystem and is integrated directly into the runtime of our parachain as a pallet.
As such, a primary trading pair on Pablo will be PICA with some of the first pairs available being PICA/USDT and PICA/KSM.
You can also expect various liquidity incentives with 15% of PICA’s supply being allocated towards liquidity programs on Picasso.
Overall, Pablo will offer users:

- Bonding mechanisms
- Permanent, protocol-owned liquidity
- LBPs
- Yield farming opportunities

## Governance & Picasso treasury
PICA is the native token of [Picasso](../picasso-parachain-overview.md) and the [Centauri chain](../centauri-chain.md). We have made a concerted effort to ensure that the PICA token holds as much utility as possible by incorporating various value accrual methods, and governance features. While the PICA token provides the community with a strong voice and rewards for participating within the ecosystem, it is also fundamental for the operation of collators, validators, oracles, and our other cross-ecosystem strategies. Thus, the PICA token is fundamental for governance, network usage, and the security of Picasso.

This means that PICA serves the following functions within the ecosystem:

## Tri-staking token model

Within the Picasso ecosystem there are multiple staking avenues that can be utilized to earn yield in PICA. This tri-staking model strengthens the security of the network while maintaining liquidity and distributing maximum value back to Picasso token holders.

### Oracle staking​
Apollo is a permissionless, MEV-resistant oracle solution. Anyone can run an oracle node on Picasso by providing a PICA stake.

### Collator staking​
25% of fees on Picasso are distributed to collators, with the remaining 75% going directly to the community-governed treasury. Collators on Picasso are required to put down a stake to produce blocks on our parachain, as with most proof of stake networks.

### Centauri staking
Initially, PICA will also be used by Cosmos validators for securing our Cosmos chain, entitled Centauri. This is the first instance of a token being utilized for validation within both the Kusama and Cosmos ecosystems and highlights the critical role PICA plays within cross-ecosystem communication. Our Delegation Program has set forth a proposal to delegate 1bn PICA tokens from the treasury to validators to ensure a robust and secure network while ensuring a 10% APR in PICA.

## The first cross-ecosystem token
As Picasso plays a pivotal role in both our Kusama and Cosmos strategies, PICA will be utilized across both ecosystems as we continue to explore new use cases and integrations.

### Gas (network usage)​
The PICA token is uniquely positioned as the gas token at the center of Picasso, powering Composable’s efforts to enhance blockchain interoperability. Initially, this means that PICA will not only be used for transactions on Picasso itself but will also be required for bridging assets via Centauri, and cross-chain function calls. Additionally, PICA will also act as the gas token for the CosmWasm dApps deployed on the ccw-vm on Picasso. Notably, in order to further support users from other ecosystems Picasso offers a feature called “bring your own gas” (BYOG), which allows users to pay their gas fee in any supported tokens.

For example any cross-chain XCMP transactions can choose which assets to use to pay for the transaction. These tokens are then swapped for PICA under the hood, allowing users and liquidity to flow seamlessly through Picasso regardless of what ecosystem they are arriving from.

All fees may change dynamically depending on network load and pool or protocol fee formulas. The most fundamental factor for gas fees is the computational resources it consumes which is represented as the transaction's "weight". The weight of a transaction is converted into an appropriate amount of PICA by the polynomial formula which changes dynamically depending on the target load of the network. This means as the usage of the chain increases towards maximum capacity, the price of a unit of weight increases as well.

### Primary pairing on Pablo​

Pablo is the native DEX of the Picasso ecosystem and is integrated directly into the runtime of our parachain as a pallet. As such, a primary trading pair on Pablo will be PICA. You can also expect various liquidity incentives with 15% of PICA’s supply being allocated towards liquidity programs on Picasso.

### Powering our advancement into the Cosmos
New use cases will continue to be established as we move forward with XCM channel openings and our expansion into the Cosmos.

## Governance & treasury management

The treasury will be community owned and controlled by PICA token holders.

Picasso is waging war on centralization with our vision of a 100% trustless future for DeFi,
entirely removing any drop of centralization from our parachains.
As such the PICA token will play an important role in helping to realize this vision,
as governance will be handed over to the community after the core infrastructure is in place.
PICA holders will then be responsible for governing the network by submitting proposals for
Picasso is waging war on centralization with our vision of a seamlessly interoperable, trustless future for DeFi. As such the PICA token will play an important role in helping to realize this vision, as governance will be handed over to the community after the core infrastructure is in place. PICA holders will then be responsible for governing the network by submitting proposals for:

- Election of council members
- Which pallets are incorporated into Picasso’s runtime
- Which pallets will graduate to the Composable parachain on Polkadot
- Which pallets will live only on Picasso, and which will live on both chains
- Directing treasury initiatives
- Which channels are opened through XCM
- What chains and channels are supported on Centauri, our IBC<\>Substrate bridge <!--avoids MDX false positive-->
- And any other action/feature the community decides to implement into the network.


## Ecosystem growth incentives
Holders and stakers of PICA and PBLO could become eligible for unique airdrops of protocols that are newly deploying
onto the Picasso ecosystem. This may not only provide a unique benefit for holders and stakers of PICA and PBLO,
but could also provide increased pressure to hold and stake in anticipation of future opportunities.
Furthermore giving protocols that deploy onto Picasso a unique opportunity to enter the ecosystem with airdrops
to supporters of the ecosystem.
- What chains and channels are supported on Centauri
- And any other action/feature the community decides to implement into the network.
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6 changes: 5 additions & 1 deletion docs/docs/user-guides/centauri-staking.md
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![staking-quatro](./images-staking-centauri/centauri-stake-4.png)

You have now successfully staked PICA to secure the Centauri chain!
You have now successfully staked PICA to secure the Centauri chain!

:::note
The Centauri network requires PICA to be delegated to a validator to earn staking rewards. To unstake PICA after delegation, it must undergo a 21-day "unbonding" period to receive your tokens.
:::
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