Abstract

Today, almost all of our financial services are controlled by banks, from account management and payments to loans and investments. As a result, the problems with the current system are increasingly becoming evident to all of us:

• Censorship
• Custodial Management
• Compounded costs and fees due to middle(wo)men
• Slow transactions
• Limited Investment Products
• Inaccessibility to many sectors of the population

The good news is that it is finally possible for us to take our financial future into our own hands and change this system. Finally, we can break through the walled gardens of traditional finance and create a new system that works for us, by us. We got so used to banks managing our money, but the truth is we don't need them anymore. They use it to get richer, and we don't see any of it. That is all about to change.

Decentralized Finance Applications (DeFi) have taken the crypto world by storm since their inception. DeFi can be defined as the transformation of traditional financial products into products that operate without an intermediary via smart contracts on a blockchain. In principle, any existing financial service that is centralized could be transferred to a similar decentralized financial service. Unfortunately, while crypto has attracted billions in investments, decentralized financial services are still lagging.

Initial attempts to create decentralized financial management systems so far have proven partial and unreliable. Hence, average users and investors have to man-hand highly complex products to manage, invest and trade their crypto assets. Nevertheless, the potential to provide financial services in crypto, the same way they are offered in fiat currency and traditional banking, is enormous.

Introduction

Unifyd is next-generation one-stop management, optimization, and automation ecosystem for decentralized finance products, investments, payments, and wallets focused on security, accessibility, and adoption, making it possible for anyone to truly be their own bank. Unifyd is the first platform that genuinely creates a completely open and fair ecosystem lead by the community of its token holders.

Unifyd simplifies and aggregates all the pieces of the DeFi puzzle into one coherent interface in a way that even inexperienced users and network participants can understand. From lending protocols and liquidity mining to streamlining staking and delegating assets.

Unifyd is the first protocol to place fundamental emphasis on security and offers a dedicated fund to insure and cover potential losses of network participants. In addition, after every single change, every smart contract is verified and audited by top security firms and is published to the community and peer security experts for review.

The cryptocurrency industry is based on a simple premise: people should be fully in control of their finances. However, current systems and apps are far from providing services that bolster wide adoption and provide a solution for average users with daily money management worries like figuring out their income, expenses, balance, and assets managed on autopilot.

Unifyd's mission is to give people (and in the future, machines, and devices) seamless access to decentralized financial services in a way that supports our daily lives—helping the next wave of users onboard the open financial ecosystem.

Problems & Motivation

1. Financial Services Are Centralized

   Our most fundamental motivation and driving force is to create a fair and open financial system for all of us, where we are the ones in control of our finances. The most pressing issue of our growing global economy is that it is centralized and entirely controlled by a small group of people.

2. Advanced DeFi Products Are Not Easily Accessible

   Advanced decentralized products such as auto-compounding vaults, composing conditional trades, staking, flash loan arbitrage, and flash liquidations are only accessible to experienced developers. As an average user or investor, these types of products are out of reach. You can't fully enjoy their benefits to grow your wealth and put your assets to work for you in an optimal composition according to your current holdings. Non-developers are excluded from some of the most innovative solutions of DeFi, and as it evolves, the gap is just going to grow bigger.

3. Users' Assets Are Scattered On Multiple Wallets, Protocols, And Exchanges

   The DeFi ecosystem is evolving at such a high speed it's hard for most users to even keep up with all the new tools and building blocks that emerge daily. Users new to crypto and even the more savvy users struggle to understand it all and manage their assets to get optimal returns. Even though there are solutions to help optimize yield, the experience is not easy for new users. They do not provide holistic, autopilot products where average users and savvy investors can easily manage their assets, wallets, and portfolios from a to z through one point of access.

4. Existing Protocols Lack Security Mechanisms To Ensure Users' Safety

   Security in DeFi is probably the most significant concern that keeps users from venturing out of centralized exchanges and entirely relying on decentralized solutions. It seems that every other day another DeFi protocol is hacked for millions costing its users and investors losses that sometimes obliterate their entire holdings. While some projects offer different insurance modules and go through security code audits, these solutions do not provide enough coverage and safety.

5. DeFi Is Too Complex For New Users

   Crypto never sleeps, volatility is high and unpredictable, staying on top of your portfolio and optimizing your returns is complex if you want to do anything other than looking at charts and comparing strategies all day long. While some products offer automated yield optimization and generation, their solutions are either too pricey, incomplete, or too complex for new users to understand. If we are going to change our financial system truly, DeFi applications must take a simple, easy-to-use form to allow all user types to manage their finances and go about their daily lives.

Proposed Solution

An ever-growing set of advanced community-backed DeFi products that together comprise a complete financial ecosystem and a single point of access management portal for crypto assets. Where users can automate their entire monetary management and optimize their yields without deep know-how, some of the first proposed components are:

1. Yield Optimization Vaults

   Capital pools that automatically generate and optimize yield powered by Unifyd's AI. Unifyd's AI Vaults socialize gas costs, automate yield generation, auto-compounding, re-balancing, and automatically shift capital as the market changes to generate passive income.

2. Index Tokens

   Like traditional markets, as the crypto market matures, it too requires easy-to-use products that serve as benchmarks and entry points into crypto. We believe that if we overlay the opportunity in the crypto world, crypto ETFs have the potential to make up a significant portion of the crypto market, and we’re here to make that vision a reality.

3. Multi-Asset Swaps

   Swapping assets is one of the most fundamental actions in DeFi. However, this manual process can quickly become time-consuming when you have multiple assets to swap one by one. Unifyd's Multi-Asset Swaps allow users to trade and transact in an unlimited amount of assets, all in a single action.

4. Community Run Staking Nodes

   How many times did you find yourself wishing you had enough funds or knowledge to run a node for your favorite network? As a community member, it's finally possible. Staking your coins while you hold them is one of the safest ways to earn interest on your cryptos.

5. Conditionally Composable Transactions

   Creating future executable transactions based on on-chain and live real-world data, and publish your trading strategies to the entire community for others to join you. For example: IF ([$BTC is 50% from ATH] & [$BTC is down 25% Today] & [$MATIC is down 45% Today]) → buy $MATIC. Then IF ($MATIC is up 80% Today) → sell $MATIC.

6. Portfolio Management

   Manage your DeFi portfolio using dedicated dashboards, plug in your data with APIs, track changes per asset from time of purchase and based on other advanced filters. The portfolio management dashboard will quickly become your go-to tool for managing and tracking all your actions.

7. Flash Loan Bots

   Community members and $UNIFY token holders will enjoy a profit share from gains earned by ecosystem bots such as a flash arbitrage algo bot, a flash liquidation algo bot, a trading bot, etc. These bots will generate profits for the $UNIFY token holders without using any of their own funds.

8. Leverage Optimization Algo

   Hook up your leveraged trades to our leverage optimization algo can automate and manage your leveraged positions to protect them from liquidation based on customizable settings in an entirely non-custodial and trustless way.

Network Security

Our protocol establishes a thorough user-centric approach to network security to answer the growing need for security and safety of user funds when dealing with DeFi, which can answer varying security needs as the protocol matures in the future.

1. Insurance Fund

   The primary mechanism for securing the Unifyd Protocol is the Insurance Fund. A percentage of the fees earned by the different products is accumulated to a fund that will be used to compensate and protect users of the protocol from unexpected loss of funds stemming from:
   
   

   • Smart contract risk: Risk of a bug, design flaw, or potential attack surfaces on the smart contract layer.
   
   
   • Liquidation risk: Risk of failure of an asset that is being used as collateral on Unifyd; risk of liquidators not capturing liquidation opportunities on time. Or low market liquidity of the principal asset to be repaid.
   
   
   • Oracle failure risk: Risk of the Oracle system not correctly updating the prices in an extreme market downturn and network congestion; risk of the Oracle system not correctly submitting prices, causing improper liquidations.
   
   

   The size of the fund is decided based on the volume and total value locked in the platform and is accumulated intermittently. The first milestone for the fund is 20 million $USDT.

2. Safety Module

   The secondary mechanism for securing the Unifyd Protocol is incentivizing $UNIFY holders to lock tokens into a Smart Contract-based Safety Module component. The locked $UNIFY will be used as a second mitigation tool if the Insurance Fund is not enough to cover everyone's losses. The activation of this tool is subject to a Governance vote. The Safety Module can use only up to 20% of the assets locked to cover the deficit.
   
   Participants' decision to lock $UNIFY into the Safety Module assumes the acceptance of a potential loss of funds event as they secure the protocol in return for receiving rewards in the form of Safety Incentives and fee distributions.
   
   To contribute to the protocol's safety and receive incentives, $UNIFY holders will deposit their tokens into the Security Module. In return, they will receive governance tokens (See 'Governance' for additional information) and a tokenized position that can be freely moved within the underlying network. The holder of the tokenized position can redeem their share from the Security Module at any time, triggering a cooldown period of one week. Safety Incentives rewards are subject to a cooldown period where tokens are unclaimable. The cooldown period is set to seven days.
   
   The Safety Module is built on top of existing AMM technologies. Users will have the choice to lock single $UNIFY tokens directly or provide liquidity shares from the 80/20 UNIFY/ETH Balancer Pool.
   
   The Safety Module solves the issues with traditional staking systems and market liquidity: Tokens with locking/reward schemes tend to suffer from low market liquidity and extreme volatility when a high percentage of the total supply is locked. With the ability to contribute to the Safety Module by locking $UNIFY and contributing with liquidity into an AMM, stakers create a trustless and decentralized market with deep liquidity for trading $UNIFY against ETH.
   
   The advantage of using Balancer against other AMM solutions is evident when we factor in the possibility of dynamically adjusting the weighting towards $UNIFY. This allows the creation of a market and the provision of liquidity while maintaining exposure to $UNIFY. Holding UNIFY/ETH liquidity with uneven weights is very close to simply holding $UNIFY, with the benefits of earning trading fees on top of it.
   
   Since Balancer Labs is distributing $BAL governance tokens to liquidity providers, having the Safety Module liquidity in Balancer enables the users to receive $BAL tokens on top of trading fees, protocol fees, and Safety Incentives rewards.
   
   Allowing users to lock single $UNIFY tokens enables us to free up less advanced users from the burden of providing two different assets to participate in staking. In addition, the Safety Module will support weighted incentives to attract liquidity in case of AMM imbalance.
   
   The Safety Module mechanism is reinforced with a built-in Backstop Module. This module is a smart contract-based deposit pool to allow the Unifyd Community to deposit stablecoins and $ETH acting as a buy order for the $UNIFY token at a price agreed on by the protocol governance in the case of a capital loss event, to act as a buyer of last resort.
   
   Back-stoppers are incentivized to have liquidity in the Backstop, as protocol fees are shared with them. In case of Backstop buyback occurrence, the $UNIFY purchased by the Backstop is distributed proportionally to backstop LPs, or they can directly deposit back their newly acquired $UNIFY in the staking module.

3. Routine Audits

   One of the shortfalls of security audits is that in most cases, protocol developers make additional code changes after an audit already took place, rendering the audit useless. This bad practice alone is the cause for many of the latest DeFi hacks and exploits. As part of our focus on security, our team commits to routine audits for every set of changes we make to the protocol's underlying code. This ensures the code we ship is as battle-tested and proven as possible. In addition, we make sure multiple firms audit every contract we ship. Among the experts we work with are the team at CertiK, PeckShield, Open Zeppelin, SigmaPrime, Consensys Diligence, and more.

4. Bug Bounty Programs

   An integral part of our innovation process is research and peers reviews. We seek cooperation with experts in their fields for every aspect of our ecosystem, focusing on research and creating state-of-the-art technology. For example, our Bug Bounty programs incentivize white hat hackers to break our code and actively support our efforts to attract talent to our ecosystem. In addition, we partnered with the team at Immunefi to expose our programs to a broader hacker community.

Governance

Protocol Governance

The governance token for the Unifyd Ecosystem is Epsilon ($PSI). $PSI tokens can only be earned by staking $UNIFY tokens in the Safety Module. Staked $UNIFY tokens accrue interest in real-time in the form of newly minted $PSI tokens. $PSI tokens entitle their owners with governance powers and profit share rights.

In general, the Unifyd Ecosystem governance consists of the proposition and decision-making process for the different changes, improvements, and incentives that constitute the policies and upgrades to the governance mechanism itself. All future decisions governing the ecosystem will be enacted through this procedure.

The $PSI token empowers holders to collectively act as governors of the ecosystem by enabling them with the capability to vote and propose.

This ensures the ecosystem can rapidly adjust to changing market conditions and upgrade core parts of the ecosystem as time goes on.

Governance Power

$PSI token holders receive governance powers proportionally to the sum of their balance.

There are initially two powers associated with each governance token:

• The proposal power gives access to creating and sustaining a proposal.
• The voting power is used to vote for or against existing proposals.

Any user can choose to delegate one or both of the governance powers associated with a token, either through our governance portal or programmatically.

Governance Proposals

The steps for a successful governance proposal are:

1.  Creating a Unifyd Request for Comments (PRC) and receiving community input.

2.  If the PRC is non-contentious, then submitting a Unifyd Improvement Proposal (PIP).

3.  The PIP, including the necessary payloads, are forwarded to the protocol for a governance vote.

If successful, the PIP's payload will be automatically executed and implemented.

Tokenomics

Triple Token Mechanism

The Unifyd Ecosystem is supported by a unique triple token mechanism that is designed to sustain its inception and long-term growth in a decentralized and fair process. The three tokens are $ALPHA, $UNIFY, and $PSI. Seeing the evolution of other networks and ecosystems, we've realized that single token economics can't answer the needs of a growing system and maintain all token holders' interests. As a result, we came up with the following tokens composition:

The Official Token $UNIFY

Max Supply: 1,000,000,000 $UNIFYThe $UNIFY token started with no pre-farm nor pre-sale. $UNIFY tokens are minted linearly beginning from 1 August 2021 and will end approximately during July 2021 (8 $UNIFY/block: approximately 230,400 $UNIFY daily).

To ensure fair distribution of $UNIFY, only vault users will be able to mine $UNIFY tokens in addition to the yields from auto-compounding vaults.

$UNIFY token can stake their tokens to earn $PSI governance tokens, provide liquidity for LP rewords, and get discounts on fees using the different products in the ecosystem.

Buy-back Mechanism: 10% of fees on users' profits are used to perform market buy-backs of $UNIFY tokens.

Distribution Breakdown

• 80% are fairly distributed through the vault token mining program
• 20% are dedicated to the ecosystem to ensure sustainable and rapid innovation. It may also be used for future incentives of cross-chain vaults and other products in the Unifyd ecosystem

The Governance Token $PSI

Initial Supply: 0 $PSIThe $PSI token started with no pre-farm nor pre-sale. $PSI tokens can only be earned by staking $UNIFY tokens in the Safety Module.

The $PSI token is the governance token of the Unifyd Ecosystem and gives its owners' governance powers and the ability to influence the future of our system. $PSI token holders earn a share of the profits of the ecosystem.

The Early Adopters Token $ALPHA

Total Supply: 1000 $ALPHAThe $ALPHA token was only offered for early adopters of the Unifyd Ecosystem. $ALPHA token holders supported the bootstrap of our community and the first products in our ecosystem.

$ALPHA token holders have exclusive rights to a share of the profits from our flash loan products.