HODLing has been the best strategy in crypto. Hodl is here to help you do that with some extra incentive!
Hodl is a protocol designed to let anyone create "hodling competition" on any ERC20 tokens. Users can always choose to quit early with a penalty charged. If a participant successfully hodls the token until expiry, they can withdraw the full amount they deposited without any fee, and with some extra tokens collected from quitters, or other "bonus token" that can be donated to the pool.
The spirit is that if you plan to hodl a token anyway, there's nothing you can loose by participating in such a "game". We want to encourage people to simply hodl tokens and focus more on the long-term achievements of corresponding projects.
A team with a token who wishes to stabilize the token price can provide some extra incentive for people to hodl their tokens and not sell for a longer period of time. This can also be customized as a "Lock" contract, where quitters loose 100% of their deposits. We believe that these use cases can be helpful for projects to incentivize long-term hodlers.
Projects can mint an "hToken" (hodl token) to a user or a community member by locking up the token. The user who then receives hTokens cannot trade them, but will be able to decide if they want to withdraw now and be penalized, or maybe wait for a year or so to receive the full amount. This is somewhat similar to the idea of vesting, but with more customizable features.
Many protocols with tokens provide a staking mechanism for token holders to earn some extra reward, but it's also common for people to leave the pool once the liquidity mining program is over. With Hodl, projects can incentivize long-term stakers by launching a Hodl contract on "stake shares" tokens, and make sure that only the people who hold until the end get rewarded.
This is very similar to the previous use case, but takes advantage of the bonusToken feature of Hodl. It might not be the best idea to incentivize LP token holders with more LP tokens, because the risk that the market makers are taking is huge and hard to offset by offering more LP shares. This is when the bonusToken becomes helpful - it allows pool creators to use a different token to reward the "LP token hodlers". This also solves the problem of needing some on-going liquidity mining programs to keep people in the game.
You can always wrap your hToken into some tradable ERC20 tokens by using another wrapping contract, and add more interesting logic to build fun projects, e.g., make it transferable only until a certain date.
This is the contract repo for Hodl, which enables anyone to create hodling pools. There are 2 contracts in the core folder:
HodlERC20: Implementation contract to "Hodl" an ERC20.HodlFactory: Factory contract to cloneHodlERC20with EIP1167.
When a user deposit ERC20 into a HODL pool, the tokens will be locked up in the contract until the end of a pre-defined expiry. If a user wants to remove their funds before expiry, they will be penalized by penalty proportional to their deposit, and the slashed amount will go back in to the reward pool that will be shared by everyone else holding a "share".
Every time you join a pool, you get a hodl Token + some shares. The hodl token is a non-transferable ERC20 - this is to prevent anyone from creating a secondary market to trade this token, which would eventually make it not a hodl strategy anymore.
The shares you get from the deposit will decrease (linearly / exponentially according to a decrease parameter n) as time goes by - this is to prevent a last minute depositor from enjoying the full reward. This also means that the earlier you deposit, the more shares of the pool you can get.
A fee is charged from penalty when a pool member quits early. The creator of the HodlERC20 contract can specify a feeRecipient address that can later collect those fees. For example, it can be set to a governance contract address that distributes the reward to all token stakers.
All quitter's penalty goes to the common pool, from which anyone with a pool share can proportionally redeem at any time. When a user quits, they are also forced to redeem some of the pool shares (proportional to the amount they're withdrawing). This is necessary to prevent people from leaving the pool early but still earning rewards.
npm i # unit test
npx hardhat test
# coverage test
npx hardhat coverage npx hardhat formatSlither is a static code analysis tool that helps to detect bad smart contract patterns.
Install Slither
pip3 install slither-analyzer
Or find more details here in their documentation.
slither .
Running this script will deploy both HodlERC20 and HodlFactory, and try to get them verified on etherscan.
npx hardhat run --network {network} scripts/deploy.ts