Chicago Ethereum Meetup | Intro to PoolTogether and overview of the v3 contracts

okay thanks so much to brendan from pool together for joining today for this meetup this will be shorter than our normal recordings if you're checking this out on youtube after the fact but uh very excited to hear about an intro to pool together and a little bit about the new v3 contracts so thanks again and take it away brandon yeah thanks paul good to be here um so i'm not sure where everyone stands in terms of what they know so i'm gonna start from scratch and i'm gonna rip through our intro slides just to kind of explain what price savings are and then we'll talk about v3 and what's what's new it's kind of upcoming so could i access screen sharing indeed let me just uh change that okay you should be able to now that's cool and if you guys can't see it let me know but it should be good to go so if i go full screen can everyone still do this yep okay it looks good i guess there are a lot of muted people so um so praising savings what is it um essentially it's a savings account such that every dollar you deposit is a chance to win the prize and the prize is the interest that accrues on all the deposits so this is also known as a lossless lottery everyone is effectively buying tickets by depositing funds those give them proportional chances to win a prize that is the interest that's accrued um so a typical account has like you know 0.35 let's say apr very very low um if you deposit like 100 you might get a couple pennies over the year and so what's cool about pull together is that you deposit any amount and you have a chance of winning a much larger amount um granted there are some opportunity costs but the upside is so big just just to be in it to um for the chance to win that uh which is like potentially thousands of percent greater than what you put in um and it's it's actually really old idea all these countries and more have had prize link savings accounts and quite often because it's like a lottery system it is run by the government typically but now thanks to these uh uh trustless autonomous escrow contracts these smart contracts we can easily implement these safely and autonomously so the biggest one in the world is the premium uk bonds they have about 100 billion dollars deposited in them over 20 million different accounts and they award 1.3 billion dollars in prizes every year but they actually generate about 10 billion in uh revenue but 9 billion approximately goes towards public services in the uk because it's a government-run project um so it's kind of an interesting split between public service and benefit and the uh kind of chance to win as an individual and so this kind of like makes a lot of sense for your fork because potentially you know it could actually fund um the chicago meetup and maybe a fraction can go towards one of you so it's uh it's it's a neat system that is already applied in that same kind of fashion and so we can see that so so the price savings the uk dream bonds started i think back in the 50s and what's funny is that they have very much the same language it's um you know you don't risk a penny by by being in it and you can get your money back whenever you want that value prop has not changed and so the economics like i was referring to before are really cool because typically if you have like a savings account the interest is super low but the risk is super low as well um and this this gradient runs all the way through to say a startup where it's incredibly high risk and the potential for ward is really high i'm sorry the potential reward is very high as well but pricing savings is interesting because it's very low risk but the upside is super high and so what we've seen in people's deposits in that is that most people just you got to be in it you got to have something in it you got to have some chance because the upside is so high um so the cool thing is you don't have to choose between safety and reward you can have both easy-peasy um and so here's the example i was referring to we have had a user who had 10 die deposited for about 30 days or she potentially and they won 1659 die which is a massive return off what they put in so it's a good idea just to have something in it you just got to be in it to win um and so we what we really love about prize savings is that through these yield services like compound we can expose this this this amazing machine to the world through a very simple product which is price savings it's simply this idea of a lossless lottery and we can build this on top of any of these yield generating services so we can we can take advantage of these crypto yields and um really be a very compelling uh value to the end user uh without letting them know hey how does this work they don't have to know how compound works they don't have to know how it's over collateralized and very very low risk um they just get to leverage the yield that's coming off of it so we think prime savings is really awesome and um it works really well on ethereum and um uh there's so many reasons for this i won't get into this now um but uh this is just the intro portion so after this i'm going to get a bit of technical around v3 i'm just ripping through this really fast um but does anyone have any questions off the back if anyone does feel free to unmute or if you're feeling shy throw them in the chat you can ask i'll bring up the chat feeling good okay cool so what's happening in v3 well v2 v2 is interesting because it was like a product it was mostly a product it was a product before it was a protocol and so um we have streamlined it for end user ease of use rather than developer convenience and so with v3 we're transitioning more to a protocol because we want this to be extremely extensible and decentralized that anybody can use it and build off of it uh and so there's three there's three pillars to this really extensibility usability and decentralization um and so the extensibility is it's pretty straightforward we want more yield sources so we love compound and we've been built building on compound for ages but now there's other really interesting projects such as ave that we'd like to use that also provide yield services it has a slightly different mechanism but it's proven itself to be a reliable source of uh yield and then we'd also like to have custom prizes like imagine if you could award nfts as part of the prize or just arbitrary erc20 tokens you can just pile everything in and then when you hit reward it gives them the interest as well as all these fun little little bits and bobs sort of like the nft that you guys just received um something else that's coming in v3 is custom pods so if any of you recall like within office there's often like an office lottery pool where everyone buys puts in a couple bucks and they buy all these tickets together it's the exact same concept in that we allow people to combine their cool together tickets and so you can actually have and you can do this trusted trustlessly so you can have a much greater chance of winning um just a share of the prize and so what's cool about that is it introduces a spectrum between the like maximum risk maximum reward all the way through to virtually interest because if everybody's part of the pod and the pod wins every time it's effectively interest so it's kind of this introduces interesting spectrum between the two uh extremes and then then finally we're introducing referral rewards for e3 and we're really excited about this this is something that people have been asking for a long time um but you're you're going to be able to basically share a link out with friends and family and if they do buy tickets then you'll get a few tickets or like a fraction of this referral volume as a result so it's going to be a really fun mechanism to introduce so the next one is usability gas prices this is something we're all feeling right now they're brutal um i mean right now we saw what it's like 40 40 gray or something like that but that even that is is is higher than it was in the past like i remember the days of four way you know back in the day um and now we're seeing highs of like 120 it's absurd and so to deposit and to pull together recently has been like 12 or even 21 i think we saw a transaction go through so um quite often these deposits are like 50 so having a deposit that's 20 really doesn't mean it's no loss so we're really working on improving that so that's going to be a big part of it is optimizations um another big part is the instant price eligibility so v3 is going to have a brand new token model much simpler token model v2 has this delayed batch minting mechanism which was really effective to prevent people from gaming the system but unfortunately it was incredibly complicated to build against if you want to build code against it because you have to wait until the actual token was minted and then you could do transfers so you can't just like do a quick exchange and then a transfer right away it's this uh it was a very strange process we've really improved that and uh and have this entirely new uh fairness model that uh that supports that um also meta transactions out of the box so we're um we support gsn v2 out of the box so that'll be nice for people who do want to run meta transactions and sponsor their users and uh and finally i put l2 support in here in italics because we don't actually have any support for yet but it's something that we're thinking about actively now given how high gas prices prices have been and we have some ideas there um that i've been uh i've been looking into that i'm happy to share at least at a very sort of hypothetical level uh after if you guys are interested um but so the big one is decentralization um this is the main pillar for this next version so uh just to fill you guys a little bit in um is that we were for v2 essentially coming up with a random number ourselves and while that's all well and good if um if we're trustable which we were trustworthy rather um ideally we'd like to make this thing as trustless as possible and so we have a much better rng source this time using a combination of the chain link vrf and the starkware pdf and then as well as being non-custodial so previously our prize pool was a singular contract that we had the uh upgrade controls for so we were able to replace the code that lived at that address with new code and that effectively is custody because that means we could replace that code with you know some malicious code that steals everyone's phones or something like that of course we're not going to do that but and now as well it's behind a multi-sig so it'd be very difficult for any one person to do that but for the next version we're actually it's it's the logic has been split into two contracts there's one the prize pool which is immutable and autonomous outside of one function that can be called by governance which is the emergency shutdown which actually detaches it from the price strategy and users will deposit and withdraw through the prize pool so funds are never custody by uh on another contract everything always goes through the prize pool and then the prize pool exposes the interest to a price strategy contract and this contract is able it's upgradable and it's controlled by governance it has a number of different admin controls to manipulate the exit fee the early exit fee as well as the uh the time lock duration which i can speak to after and it's able to allocate interest to anyone and so really the risk has been mitigated to just the interest on the uh the funds in terms of custody so this is a really really critical distinction from v2 is that now no one controls the funds um the prize pool is going through audit uh in a couple of days and so um yeah it's going to be a very uh very solid piece of code and that brings us to governance um and this this is really cool because this all of this is coming at this perfect time where everyone's thinking about uh yield farming and liquidity mining and um this is something that we're going to be supporting in b3 is the ability for people to by virtue of holding pool together tickets they'll be dripped governance tokens and so just by you know being a part of the system you'll begin to have more and more say in it which is going to be a lot of fun to implement because there's a few uh aspects of the prize strategy that are uh changeable by governance and so what we want to do is basically see the governance tokens to all the users over x number of years and then allow basically transition to community control protocol so it's part of the vision that we all have right is to have this peer-to-peer decentralized software so we're really excited to be moving in that direction so um yeah on the governance note we are not uh the the governance drip isn't starting at the end of august when we launch v3 it'll be starting shortly after there's a few mechanisms we need to test first to make sure everything's in place and you also want to put the actual governance proposal system in place so there's a few things yet to be done but the the machinery is there anyway and so um we have v3 on coven if you do want to go and create your own prize pool it uses the default prize strategy so if you did want to get your hands dirty and really write your own you would have to just literally fork the contracts but if you want to play with it you can go to the builder builder.pulltogether.com and create your own encoder we don't yet have a robston or winkabi but we're we're getting there i i threw this all together just for this presentation just uh just today so it's a very very short notice but um but yeah that's where we're at so um does anybody have any questions you guys are good to go i i've got one one question that you might have touched on it a little bit but um so you've mentioned yield terming a little bit and governance tokens in some other contexts um compound for example comp accrues to or is distributed to uh lenders and as well as borrowers how do you think about how comp interacts with the prizes that come from pool together in the current iteration yeah um we believe a lot of our users are aware of cop and so we are likely going to for the next next version um as sort of an external award just as we mentioned that you could drop arbitrate erc20s into the prize pool and have them awarded as part of the prize we're going to do that with the comp so you'll be able to win the interest but also win whatever x number of comp is accrued in the prize pool as well so it'll be kind of this bundle of prizes versus just being a singular prize that is the interest so what's interesting about that actually is that the interest becomes more of a fairness check to make sure that everyone has has a fair part of the pool because once you start loading in nfts and other prizes it's it's less it almost becomes less about the interest and more about you know the just the fun and fairness of being in this pool even though the bulk of the prizes is generated from the interest so i think it's gonna be fun to play with that and um yeah see how see how the users react maybe they don't care about comp you know it'll be interesting to see maybe we'll reserve that for a power user but we'll have the machinery there for that flexibility we've got a question from vishal in the chat he asks can we build a banking app using the pool a banking app um a banking app to the extent that you you take fiat i'm guessing and deposited could you elaborate i'm not sure i mean yes arguably all these smart contracts are banks in themselves because they're all escrow so um it's like this is the nature of this kind of peer-to-peer banking system and this is one way that this is one savings mechanism that you can use so yes i would say that yes you could build this into a banker or make it part of a bank let's say or have it as a service an add-on something like that oh will the gas tokens there be with ethereum 2.

0 um no we haven't integrated gas tokens so that is that perhaps is an exercise for the reader um is to build a wrapper around that can consume burn gas tokens um it's a really interesting mechanism but their their our focus this this time was on stripping it down to be as minimal as possible and it'd be fairly straightforward based on how we've designed the contracts to add a gas token wrapper got one other quick question i know there's a feature in pull together for um people who aren't gambling uh to contribute funds to the pool that are cruise interest how how crucial do you think that is to the appeal like for for our fork experiment here do we need a decently sizable matching pool for it to be worthwhile yeah it does need to be pretty big i mean like that we've used the sponsorship as a way to bootstrap pools so that you don't see like a zero dollar prize because that's not very fun you know you want to have something in there um in terms of the economics of it i mean this this is all just you know ideas i speak for myself when i speak about this opinion but i think it'd be interesting if we um let's say align the incentives in the sense that the tickets when you bought a ticket would be eligible for the interest because you want the prize the sponsorship they forego their interest and they forgo their chance to win but potentially they could accrue the comp um that all the other tickets are accruing because they're sort of power users they know that they just want to farm as much as they can to get as much comp as possible um likewise for the ave perhaps there'd be an avec token that they accrue as well so i i think it's kind of interesting to be able to play with those economic incentives um we haven't designed it as such yet we're just building the groundwork and laying it so that we can start to put these mechanisms in place um but i think it would be interesting to kind of give people a reason to sponsor it's like if they don't care about interest if they just want comp sponsor pool together because you're effectively capturing like if sponsorship is half of the tickets then you're doubling your comp uh return so to be kind of a worthwhile value prop to them so yeah any other questions anyone before we let brendan uh go okay well thank you so much that was a super interesting presentation