SMUG Protocol - A Community DAO & Farm Auction Dex with protocol-owned liquidity

Name of the Project

SMUG(DOGE) PROTOCOL

‘Serving Many Users Globally’ Protocol

Application type

Launch grant with a future investment ask.

Proposal overview

In crypto, especially when talking about meme coins, its important to be safe and sound with your investment. Volatility is expected in meme coins, but a rugpull is not. SMUG is a unique meme token on because of its reflectionary/redistribution mechanism, and is fertile grounds for a DEX. It’s important to first understand this:

Every time you buy, send, sell, wrap or LP your $SMUG, you are subject to a tax of 10%, no exceptions. Half of that 10% (so 5% of your transacted amount) is permanently re-added to a locked liquidity pool (which you can check in the verified Contract section of the block explorer at our contract) with the other half being redistributed to other holders of the token (airdropped to your balance which you can check on the blockexplorer or Metamask).

That’s not us adding anything manually to the LP. In fact, it makes no sense, economical or otherwise (for now) for you or anyone else to add any LP yourself to this pool.

When it receives the ONE from each taxed transaction, it uses half of it to buyback $SMUG from the protocol, and adds it permanently to the liquidity pool by burning the LP tokens. This is the reason why you need to set slippage to at least 11% when interacting with $SMUG.

Receive tax ->Sell half of ONE to $SMUG → Bind the remaining half with $SMUG (auto-buy) → Add to liquidity pool → Burn tokens

And it never stops. Day or night. No matter how small the amount, this allows for an ever-increasing price floor, and it allows for big buys and sells to flow into the coin, at a lower price impact, as the liquidity is crowdsourced from everyone.

You can read more about the details of this on the external links section.

What’s Unique

  • While the above taxation mechanism isn’t anything too novel in crypto (pioneered by SafeMoon and alike), the idea of having a truly community-owned locked LP, especially when being a ‘meme-token’, gives us a great foundation to build upon and allow people to launch their own tokens on our platform!

  • By having community-sourced liquidity, there’s less risk for users, and it gives way for a more equitable distribution. When the protocol owns the majority of its own liquidity it can to a greater extent minimize volatility and protect the holders of the token. We have the first-mover advantage in this space (Viper is only recently doing a similar thing, and it serves a different purpose, but the idea of protocol-owned liquidity is present there, and many experts agree on it being the future of DeFi).

  • The SMUG Protocol aims to act as a launchpad for meme tokens, but also adding value to older, Harmony native protocols via the liquidity mining incentives, all the while bolstering the protocol’s own reserves (locked LP, plus the small marketing wallet we have equating to about 2% of total supply). This approach solves the principal-agent problem by introducing a third party (SMUG Protocol), to act as a sort of escrow between the prospective buyers of a new token.

How it would work:

A creator of a token approaches us, and their token gets put on a list of pending projects, all of which can be voted in via snapshot DAO. Each week, qualifying projects can bid DEXSMUG for the right to host a 7-day Farm on SMUG Protocol. Existing DEXSMUG token holders get to vote on these, much like PancakeSwap does their Farm Auctions. This way, the wishes of the community are honored, and the project benefits from the transactions done, as the only way to buy DEXSMUG (and sell) is by going through SMUG (at this point in time, subject to change), which gets 10% taxed on transactions of any kind (transfer/sell/buy/wrap/bindLP), which ensures the protocol’s own treasury and locked LP goes up, as well as redistributed rewards go to the supporters of the protocol.

Well hold up -

How do we make sure that some project owner doesn’t just market-buy the DEXSMUG token, vote their project in, and then dump the DEXSMUG after they’ve finished voting and it’s a sure thing?

Great question! The transaction is, like I’ve mentioned, full of taxes, and anyone doing such a thing would have to be really, really confident in their token, in order to do it. Furthermore, there is no incentive for bad actors in this model, as the liquidity is hosted on the SMUG Protocol, and they cannot “rugpull” which is really common for meme tokens on DeFi. Furthermore, whatever the success of the Farm Auction is, SMUG (and its holders, by extension) benefit. More LP locked and added in the protocol, and more value accrued for the SMUG holders.

Upon launching, we will have 95% lockup a la Viper, in order to make sure that the POC works, and the community will vote on what happens after the lock-up period. What separates us from the other OlympusDAO mechanisms is the simplicity for the end user and the synergy we can attain from leveraging existing products such as vaults present on FarmersOnly, lending protocols existing, etc.

SMUG will be needed to buy DEXSMUG, which is needed to participate in the launches (and bids!) of farm auctions! SMUG is also hyper-deflationary in and of itself. Since the 0x0000000dead wallet now holds a bunch of $SMUG, it’s technically one of the top holders of $SMUG. What does that mean? Well, additional SMUG gets burned as part of the ‘5% redistribution to the top holders’ tax! The burn address will hold more and more $SMUG as we grow, making $SMUG hyper-deflationary!
Token is needed.

We aim to add value in a fun and interesting way and be much more than a doggy coin, due to the novel way of the protocol owning, rather than renting, its own liquidity.

State of product

  • Token launched on October 28th
  • 60k USD LP tokens community-sourced
  • Listed on NOMICS with accurate price and mcap, also listed on Coingecko.
  • Website in Chinese and English, JP soon SmugDoge — Did you buyed?
  • Organic Twitter and Telegram following that is very proactive and helpful.

Support

  • Soft support: Technology, comarketing, partner network[investors, and projects]
  • Monetory support: Launch grant, Investment.

Roadmap

  • Mid-November, SMUG Protocol launch, establishing governance via snapshot, migrating SMUG to DEXSMUG (so that interactions with the token aren’t taxed)
  • Early-December, Launching our first Farm Auction bids and distributing NFTs to the supporters
  • Leveraged yield farming on Harmony is something I have an idea of doing by forking an existing successful BSC protocol, and for this to work well in terms of tokenomics, community-owned liquidity is very important, say it a cross between TIME and ALPACA.

Team

Nenkov.one - Main and only dev, creator, website design, marketing
Lukas Konig - Main CM, but mostly the data guy who helped make the API and list SMUG on Nomics/CG/LCW and has helped me and the community a lot.
Lots of community managers and ideas men who are renowned across the Harmony community (and to them I owe most of the success, and the future success, of this project, no lie).

Proposal ask

  • 50k in tranches, as is the norm for Harmony grants.

Justification

  • The grant will be used to acquire a security audit.
  • Used to pay off bounties for technical and marketing purposes, without having to sell the token itself.
  • On-boarding more technical staff, if possible, lots of people in the Telegram chat doing a lot of work on making this project work, and they are the reason why I am applying for this grant. There’s so much potential given the 400k mcap of the SMUG token right now.

Metrics for success

  • LP tokens (USD worth) locked in the SMUG-ONE, as of today, we have about 60k USD, out of which only 2k USD is my personal timelocked funds (unlocking in late April 2022).
  • TVL in SMUG Protocol
  • Number of successfully launched tokens on our protocol
  • Number of SMUG holders (currently at about 350 Harmony Blockchain Explorer )

External links

SmugDoge — Did you buyed?

36 Likes

sounds like a great start and has been received well by the community. I am curious as to the milestones for funding. Can we get a list of the milestones that will be needed to be reached.

11 Likes

Look like a very interesting project. Is there anything on testnet for your upcoming apps?

9 Likes

Hey @Nenkov.one , thank you for your proposal!

I have a few clarifying questions:

  • On October 28th, Token launched directly on mainnet? If yes, did you also launch on testnet, and do you have testnet data?

  • For the Metrics for Success, can you please include more measurable details? We’d be looking to define “what”, “when”, and “how much”, generally.
    Here’s an example: TVL in Q1 of 2022 is above 50mn.

  • Your twitter says you’ve been audited, and in the Justification section, the first bullet point states the search of a security audit. Can you verify/confirm that you’ve indeed been audited, and can you elaborate on security audits you would be considering?

Screen Shot 2021-11-08 at 21.06.21

Looking forward to hearing from you

14 Likes

This project imho is really helping Harmony when it comes to MEME tokens. It’s literally taking the storm on CoinGecko under the TOP Meme Tokens category. First ever from Harmony! Dev has definitely taken all the right steps!

12 Likes

I think this grant application shows a different side to Harmony and should be approved. We have enough ‘serious’ projects on the blockchain, and something that has a real community involvement and maybe a bit more ‘lighthearted’ should IMHO be welcomed. I am not in anyway suggesting this isn’t a serious project as it is, I personally like the tokenomics and implicitly trust the Dev and have invested, so I may lack a degree of impartiality here

13 Likes

Hi, great questions!

  1. We launched directly on mainnet. Being just a token with reflectionary mechanisms, there wasn’t really a need for a testnet.

  2. Agreed. Given that the idea is to basically make an IFO platform, the KPIs would have to be the TVL in USD of the SMUG-ONE pool. So let’s say about 200k worth of LP tokens in the SMUG-ONE pool. by January 1st, 400k by March 1st. This is the core as through the ONE-SMUG pool on DFK people will be onboarded to the DEX version of SMUG that will not be subject to tax mechanisms, to facilitate easier trade.

Another KPI could be the number of IFOs - initial farm offerings for projects who want to launch their liquidity through our DEX. There would be two sources of taxes: a tax for getting onboard the platform (indicated by the amount of DEXSMUG held and bid with, which the project owners will have to own, pay, and we will burn those tokens), then, there will be a reflectionary mechanism for the pools as the liquidity is raised. We will use part of the DEXSMUG treasury fund in order to bootstrap these pools, and through transacting with our coin, and the would-be-IFO coin, there would be:

  1. more liquidity permanently added to SMUG-ONE and
  2. more liquidity permanently added for [their coin]-DEXSMUG.

This all reflects back to SMUG, and rewards the holders of our coin, but also gives a synergetic benefit to the would-be IFOers, and/or guest farms for coins that do not necessarily have their own liquidity pools. It’s a way of eliminating the principal-agent problem.

A third KPI could potentially be the number of SMUG holders, which is currently at around 450.
I think 10000 is very reasonable.
We have been trending for the past 48h on CoinGecko’s Meme Tokens list and are tagged as a Harmony token as well as Meme token.

The idea is to have SMUG be the “gateway drug” so to speak into the world of Harmony, leveraging its meme potential and how safe it is (which CG/Nomics have recognized, and added to their websites) and then using it as a way to onboard users onto other Harmony projects.

  1. The audit was related to the coin itself. Being a fork of DogeBonk (which was a fork of SAFEMOON), there’s not much to audit, and we do have a TechRate audit that was done for free by them. The audit refers to the security audit of the beta platform for the SMUG Protocol which will be built. The choice of the audit completely rests on the community (or the Harmony devs) as I do not want to be biased in any way or called out by the community for pining for or against certain auditing companies/services.
15 Likes

SMUG has a lot of potential to bring to the Harmony ecosystem.

While the current pathway is not unique, there are a lot of interesting things here compared to other tokens on harmony.

While many other tokens do take the community’s input into account, the entire token here is driven by the community.

The token started off just a meme token with no utility but the community asked for utility and the developer and those within the group made it happen. When people didn’t like the way it was marketed in the beginning, the team reset.

That’s the beauty of the project. The level of adaptation within its current sphere allows for a high level of unforeseen potential as the community welcomes innovation and change to ensure 100% satisfaction for the holders and the projects it wants to get involved with in the future.

A launch grant will help this token immensely with effectively marketing the token by allowing a higher quality audit so people can trust in the token. Right now, we have a free audit but a higher level more thorough audit will help build trust.

Additionally, the on-boarding of more staff will assist the current developer in being able to create an even larger roadmap for the future. This will be highly beneficial for the harmony system as this token grows.

16 Likes

At first glance another Meme coin some may think but, looking deeper into the dev and the roadmap the more I was impressed.

A community driven project offering bounties and opportunities to members of our community. If done well this could be a dex to bring together alot of projects getting lost in the ecosystem.

Hopefully, although one can never be sure, this could be a change from the pump and dump defi deflationary token projects with no use case that are bliting Harmony and maybe a bit of fun too.

13 Likes

Great community will support Smugdoge!

10 Likes

The tokenomics and marketability of this coin will only bring more users to the harmony network, and when the dex launches it will help many to understand the world of DeFi.

Projects like these provide a gateway to users who will help the main network grow, just think about how other meme tokens have attracted people to invest in them.

9 Likes

I’m really excited for the future of this memecoin. When I first bought in, I thought this will be another quick flip after the launch and then either the dev rugs the project or the token bleeds slowly.

Smug has barely launched about two weeks ago, and I already absolutely love the community that tries to help the dev in all the matters.

Another thing, probably the most important, the dev is puting so mich effort into this project. Creating the website, doing marketing, and preparing the dex platform which will launch soon in just 2 weeks is unreal. He is also often in the Telegram channel answering people’s questions.

My only concern regarding this project was the inability to sell when you have a 0 digit at the end of the sum you want to sell on the dex. This is something that’s not an issue of SmugDoge, but DefiKingdoms problem.

Other than that, I absolutely love the incentives not to sell because of the 10% tax at each teansaction and that 5% of that goes into the Liquidity Pool, which reduces the price impact.

All in all, once the dex is out this project is going to explode. The market cap is still barely above $1 million, SmugDoge has plenty of room to grow.

9 Likes

make this the official harmony meme dex! :call_me_hand::100:

15 Likes

Whatever one thinks of meme coins it’s clear that their mass appeal is a great asset for any blockchain to attract volume and users. SmugDoge’s playful community is the reason I bridged to ONE and began to explore the wider Harmony community.

The fact that a DEX is also soon to be launched means that this will be a project with staying power that can grow alongside the Harmony blockchain.

14 Likes

Awesome stuff, good luck !

8 Likes

This is probably the most interesting project that is based on meme outlook but trying to be more than that by bringing tech to harmony. The dev is probably one of the most hard working guy out there and to get at this point with the help of the community shows how much supprt there is for the project and should not be overlooked

11 Likes

As we saw with other networks like Binance smart chain and Fantom, whether you like it or not, meme tokens bring a lot of new users. It’s also the best when said meme token developers don’t use exploits or simply dump their holdings once the price has risen - otherwise newbies feel rightfully scammed and won’t think of the parent network favorably.
Nenkov, unlike certain other meme token devs on Harmony that have already dumped their holdings and ran away with profits, has shown with his attitude and work that he plans to stay. The token itself is just a simple clone of another project, but it has managed to gather a community, who said, “You know, a simple token existence is not enough, let’s promote it. Now how about building some utility for it - make a decentralized exchange with farming pools and staking. This is our chance, don’t squander it.”. And Nenkov said “alright”, rolled up his sleeves and got to work.
So I think that this effort deserves acknowledgment in a form of a grant so that the dev could focus on the project full time, hire other people, spend some on better marketing. So Harmony - please consider it.

9 Likes

Actually just wanted to address the point about the inability to sell - it’d be the same had it been on any other DEX, it is simply the way it works with high decimal coins, “issues estimating gas uniswap v2” is a uniswap thing, like the name implies, which most dexes are forked from, in one way or another. Just delete one of the many zeros at the end, and put a 1 or any other number (it changes nothing in terms of what you get from the V2 Router), and you should be OK.

I’d also like to use this chance to mention that we have gotten about 200k of volume yesterday (and most likely today as well). While it not mean much, the fact we have beaten the “honeymoon” phase of the first few days of the launch and did a complete U-turn shows how much people believe in the project, and this is even more important because of the way the tokenomics work - 200k volume, regardless of price action, means that 10k USD has been re-added to the liquidity pool permanently, and can facilitate bigger buys or sells.

(disregard the Nov 3rd as it’s sourced from an independent Twitter channel Harmony Daily

You can check the history here:

SMUG - SmugDoge Historical Price Data - Trade, Tick, Hourly & Daily Candle Data | Nomics

P.S: Website relaunched, much smoother for mobile viewing now, also proper support for Japanese and Chinese with Russian soon to follow, and also added this notice about the bounty program. Take a look!

14 Likes

#1 Top performing project on HARMONY, Top MEME coin on Coingecko, and one of Top HARMONY projects with highest trade volume along with a wonderful community with great people. Say less, SMUGDOGE is definitely going places.

9 Likes

Best meme and it’s in HARMONY congrats!

9 Likes