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Inter Protocol Liquidation Bidding Bot

Join the community of open-source builders at Agoric!

Description

Write a reusable off-chain bot for bidding on Inter Protocol liquidations and arbing them against an external market. The bot should notice pricing differences between active Inter Protocol liquidations (with the price delta a configurable parameter), purchase collateral from the Inter Protocol liquidation, make transfer to external market, and sell collateral at a profit.

Example

  • ATOM is trading at 10 IST each on Osmosis
  • An active Inter Protocol liquidation is offering 100 ATOM for 9.50 IST
  • Bot buys 100 ATOM for 9.5 IST each (950 IST)
  • Bot transfers 100 ATOM to Osmosis
  • Bot sells 100 ATOM on Osmosis for 10IST each (1000 IST)
  • Bot profits 50 IST (ignoring trading fees, transaction fees, price impact, price movement)

Context

Inter Protocol requires a healthy liquidation market to ensure protocol stability. Bots are the most effective liquidation bidders as they can actively monitor market conditions and drive profit to their owners. Healthy liquidation markets will converge to bot battles.
Inter Protocol doesn’t currently have any active bots bidding on liquidations. This would be the first!

Acceptance Criteria

  • Demo of bot code
  • Bot only places bids on active liquidations
  • Bot places all bids by price and only places bids when the necessary delta is met
  • Bot price delta is configurable
  • Bot cancels bids that were not filled
  • Bot exits filled or partially filled bids immediately and begins offloading collateral
  • Bot understands price impact of its sale on Osmosis and has some method of limiting it (hardcoded limit on individual sale size fine)
  • Bot understands the structure of the liquidation auction given governance parameters and knows the price thresholds the auction will offer at and at what time it will offer them

Time Estimation

2 weeks (80 hours)

Reward

$6,400
Payment will be made in USD (fiat currency) via wire transfer. The developer is responsible for providing their completed tax documents (W9 for US based developers and/or W8 or W8-BEN-E for non-US based developers) and providing their banking details in order to receive payment.

Applicant Assessment Criteria

Important: Please provide a clear work plan for how you will approach this bounty. Use the work plan as an initial demonstration that you would be a good candidate. Bounties will require coordination with the Agoric team, so unfortunately only plans submitted in English will be considered.
Applicants will be assessed based on the following criteria:
* Issue-specific domain experience
* Issue-specific technical capability
* Familiarity with Agoric's platform
* JavaScript experience
* Availability and communication

Experience Write-up (1000-1500 words)

As part of completing the bounty, we ask that you write up a short (or long!) summary of your experience building on Agoric. Write-up should:
  1. 1.
    Begin with a compelling, relevant introductory hook statement (<50 words)
  2. 2.
    Clearly explain the specific bounty project (~100 words)
  3. 3.
    Describe how the developer approached the problem (~300 words)
  4. 4.
    Give a step-by-step description of the solution (>500 words && <1000 words)
  5. 5.
    At least three code snippets per write-up. They do not count toward overall word count
  6. 6.
    Conclude with clear calls to action on developing with Agoric - specifically how any ambition developer reading this piece could do more themselves (~100 words).
This is important feedback for us as we evolve the platform.

Review Process

  1. 1.
    Agoric team reviews your submitted work plan on Gitcoin
  2. 2.
    It is best to join our Discord and post your gitcoin name in the bounties channel, so that we can follow up with you. Otherwise, we will write on your gitcoin profile wall and say hello!
  3. 3.
    Agoric contacts you to provide reference projects / sample code for engineering review
  4. 4.
    Introductory call to discuss your plans and expected timeline
  5. 5.
    You join the Agoric Discord bounties channel (if you haven’t done so already)
  6. 6.
    Agoric accepts you on Gitcoin and you get started!

References

Agoric Discord (#bounties channel)