AELIP-23: Underlying deal token factory

Author
StatusApproved
ImplementorTBD
ReleaseTBD
Created2022-05-23

Simple Summary

This AELIP proposes to add a new token contract for the sponsor/holder to be able to create their ERC20 token directly through Aelin Protocol when creating a deal.

Abstract

When creating a deal, the sponsor (who is more likely to be the holder in this specific case) will be able, if they want, to mint a new token directly through Aelin Protocol, which will then be used as the underlying deal token. If selected, this option will allow the sponsor to name their token and also decide what the total supply will be. They will also be able to specify an owner wallet, to which the remaining tokens can be sent in case they decide not to allocate all the supply to the pool investors.

After the deal is created, the workflow will remain the same and investors will get their share of the new token based on the size of their investment.

Motivation

It is possible that sometimes, as recently seen with Kwenta, a project which hasn't launched their token yet is willing to raise funds on Aelin. The problem is that, in the current state of the protocol, the holder needs to send the underlying deal tokens so a deal can be created and brought to investors. If they haven't deployed one yet, the easy yet not very practical solution is to deploy a pre-token (eg: vKWENTA) which is only used for the Aelin raise, to then be redeemed for the real token once it is deployed on Mainnet.

Giving projects the ability to mint their own token at the same time they create a pool/deal will definitely be a time saver. Projects won't have to worry about deploying a contract just for their Aelin pool. Every step will be taken care of by the protocol itself. It is also important to mention that the token created for a deal doesn't have to be a pre-token. Nothing is stopping projects to create their final token through Aelin, allocate a percentage to the sale, and send the remaining amount to their DAO address.

Specification

Overview

In order to achieve the functionality outlined in this AELIP, an UnderlyingDealToken contract will be added. This contract can then be called from the deal contract to mint tokens, with a specified name and supply.

The tokens will be distributed to investors the same way those deposited by the holder in a traditional deal are distributed. A part of the tokens could also be deposited to a specified address in case the sponsor isn't willing to sell all the tokens in the pool.

Rationale

A lot of new projects willing to get a seed investment using Aelin protocol don't have a token yet. As described previously, the simplest way to resolve this issue was for them to create a pre-token to be distributed to investors. The most effective and obvious solution to remove that friction was for Aelin to step in and offer these projects the option to do it for them in a decentralised and automatised way. It is believed that there isn't any easier or more relevant way to do it.

Technical Specification

A new contract will be added:

  • UnderlyingDealToken: A ERC20 token contract with an initialize function, to which all the necessary parameters will be passed, such as the token name, supply and decimal number. The tokens can only be minted once, and cannot go over the supply specified in the function. ERC20Capped.sol from OpenZeppelin could be a good candidate for this contract implementation.

This contract will then be instantiated in the AelinDeal contract. A new function initializeWithToken could be added, in order to keep the logic separated from the traditional deal flow. This function will basically do the same as the initialize one, except it will also create a new instance of the UnderlyingDealToken contract, allowing the signer to fund the deal directly with the newly created tokens.

Note: This feature will also need to support AELIP-19 so the sponsor can create a pool, deal and underlyingDeal token at the same time.

Test Cases

TBD

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