Saturn Protocol v2, and Saturn DAO which is a part of it, is a collection of smart contracts working together to pool liquidity, allocate it to the right parties, and provide the best uncensorable DEX experience to crypto traders.
This is a complicated and loaded statement. Let's progressively describe each component of this smart contract ensemble. By the end of this article, you should have a good understanding of what all components of Saturn Protocol v2 are and how they work together.
First, we will show a bird's eye view of all the components in the protocol. Then, we will review each individual component in detail and outline its purpose and function.
Saturn Rings are the user interface portals that connect users to the protocol. Saturn Network is the first Saturn Ring of many more to come. If you have ever used our decentralized exchange you have already used a Ring.
Saturn Rings cooperate by connecting to Saturn Protocol, as all of them access the same shared liquidity. We will also share our code in the form of open source and docker images to allow interested developers and business owners to integrate our technology with their websites in a cost efficient way.
Saturn Rings provide important services for the community, such as
- Attracting more liquidity and more traders to the Protocol, acting as decentralized affiliates.
- Improving uncensorability by providing access to Saturn Liquidity Pools via different domains and different protocols, such as HTTPS, TOR, i2p, IPFS, SIA Skynet.
- Providing access to DAO Voting for governance, roadmap proposals and dividend payouts.
- Run trading bots that ensure liquidity is always available at a fair price, such as cross-chain market making bots, atomic arbitrage bots, tokenized trading strategies and others.
While running these trading bots is profitable, it may be too technical and may require certain capital commitment that is not a good fit for most casual traders. However, by lowering the barrier to entry we envision a wide range of developers and business owners running plenty of Saturn Rings.
Trade router is the interface that traders and the Rings use to access liquidity of Saturn Protocol. It is also responsible for collecting fees for the DAO, as well as for the self-listing process and potential fees associated with it.
The DAO stakeholders can vote to change fee amounts as well as to impose fees on listing new tokens or outright delisting tokens from the protocol if it considers it beneficial to the long term success of the DAO.
Saturn Liquidity pools are a new #DeFi primitive that allow investors to earn realtime profits on every trade that uses a given token. Unlike some of the other protocols like Uniswap, where you need to pool ETH and the token in question, on Saturn Protocol v2 you pool the token (e.g. DAI, ETH or WBTC) along with the Saturn Token on the corresponding chain (STRN on Ethereum Classic blockchain, SATURN on Ethereum blockchain).
This creates demand for Saturn tokens and corresponding scarcity which should positively impact the price of Saturn tokens - the more used the protocol is, the higher fees are being paid out as dividends, the more investors want to buy Saturn tokens.
Investors are rewarded for providing liquidity to the pools by realtime profits on trades of given token, as well as higher voting power and dividend earning power in the Saturn DAO.
Saturn DAO Governance
The DAO smart contracts serve to coordinate incentives for every participant, ensuring long term prosperity for every party involved. The DAO collects fees from every trade done on the protocol, and its job is to allocate this capital. The uses for this capital are
- Distribute dividends to stakeholders.
- Hire workers to do maintenance work for the DAO (e.g. server hosting for the Rings, marketing expenses and community management).
- Vote to change fees in the protocol to improve coordination of incentives for every stakeholder involved.
Starting with Saturn Protocol v2 release, the roadmap for further work on the protocol falls on the shoulders of the community via proposal driven development, and the burden of making funding decisions for this work falls on the shoulders of Saturn DAO and its stakeholders.
Anybody with a cryptocurrency wallet can submit a proposal on what they can do for the DAO to make it more prosperous, more famous and to make it more used which translates into more fees collected. The stakeholders and investors vote on proposals that they like, and good proposals will receive funding from the DAO.
There are two ways investors can allocate their capital towards Saturn Protocol and Saturn DAO success.
- Stake Saturn Tokens directly with the Saturn DAO smart contract.
- Stake their Saturn Tokens along with other tokens into Liquidity pools, which improves liquidity of the protocol and gives them more voting power and higher dividend claims.
In return, the investors earn profit from the following:
- Saturn Token price increase.
- Realtime fees collected inside liquidity pools.
- Dividend payouts from Saturn DAO.
Saturn Protocol v2 can be logically divided into components that each perform their function, and are composed into one system that properly aligns incentives of traders, investors, DAO members and workers to ensure that the protocol continues to grow and provide the best trading experience to its customers.
Future is bright!
New to Saturn Network?
Read more about Saturn Protocol V2 below, an upcoming major exchange protocol upgrade which will bring token to token pairs, automatic market making, DAO activation for community governance, dividend payments and much more!