BitWell AMA | Zerogoki: Algorithm Pegged Leveraged Token Minting and Trading Protocol

Zerogoki is the pilot experimental protocol from Duet Protocol, which can provide users with leverage tools for traditional assets such as foreign exchange, gold, and US Treasuries. Users can use the platform token REI to cast leverage tokens or use the protocol’s synthetic dollar anchor asset-zUSD to buy leverage assets directly.

At 19:00 pm on August 4th, BitWell invited Zerogoki’s marketing director and core team member J. Bach as guests to visit our community to introduce Zerogoki’s latest progress, competitive advantages and project vision.

The following is a review of the complete content of this sharing:

Host: Hey everyone! Welcome to this AMA session with Zerogoki! We are thrilled to have Antonio, the core team member of Zerogoki with us today. Antonio, welcome to the BitWell community!

So let get started on section 1!

Section 1 — Project introduction & speaker introduction

Question 1: Could you please give us a simple introduction to Zerogoki?

Antonio:

Zerogoki is an algorithm pegged synthetic assets protocol focused on leveraged tokens, It is also the pilot experimental protocol from Duet Protocol but with only the Lite-minting module of Duet Protocol.

The project, Zerogoki, is a transliteration of ‘零号機’ in Japanese, stands for the experimental model Unit-00, and its token REI is the pronunciation of the word ‘zero’ (れい) in Japanese. Thus, it’s a metaphor for a prototype.

The birth of Zerogoki stems from Duet’s attempts to innovate mechanism design. Zerogoki is the first algorithmic stable leveraged asset minting and trading protocol. This is an outpost project of the Duet ecology, which will provide valuable experience for Duet’s subsequent steady launch. Through a concise and clear framework, Duet ecological participants will quickly become familiar with and understand the practical application of the algorithm anchoring mechanism. At the same time, users can experience convenient leveraged transactions of traditional assets on the blockchain.

After roughly 1 month of release, Zerogoki has gained nearly $5M in liquidity, and Zerogoki’s zUSD has been ranked 3rd in volume and 4th in liquidity within the category of algorithm stable coins on #Uniswap.

Section 2 — Answer prepared questions

Sounds impressive! Now we will enter Section 2. I will ask 5 questions. Antonio, when you finish answering each question, please let me know.

Question 1. What are the products that Zerogoki focuses on developing?

Antonio: Mint/Redeem is the core module that the project is focusing on. This key product is a synthetic asset factory which produces various innovative derivatives to market. Zerogoki has put lots of effort into the design and testing of the mint/redeem mechanism.

3 key elements are price feed oracle, minting tax adjustment and convert ratio configuration.

Zerogoki had run 3 rounds of mainnet testing before official launch to make sure all sectors worked well and scope of underlying asset for leveraged token is expanding with the growing market cap of REI.

Zerogoki aims to become the unique trading platform and constantly provides new zAsset to help users to capture the growth of everything.

Question 2. What are the services that Zerogoki provides to users?

Antonio:

1. Mint Zerogoki synthetic asset (zAsset)

2. Farm with zAsset and REI

3. Governance of Zerogoki

4. Algo-pegging stablecoin zUSD

Question 3. You were continually saying zAssets, may you please make it in detail what are those and how many kinds of so-called “zAssets” you offer to users?

Antonio: Sure, no problem. So, basically, as I said, zAssets are a series of Zerogoki synthetic assets, they’re generated by burning $REI. As of now, we are offering:

zUSD (Zerogoki Stablecoin)

zGOVT 20L(20x Long US Treasury Bonds)

zBTC 3L & zBTC 3S(BTC 3x Leveraged Token Long & Short)

zETH 3L(ETH 3x Leveraged Token Long & Short)

zMVI 2L & zMVI 2S(Metaverse Index 2x Long & Short)

And with solid growth statistics in liquidity, TVL, and communities’ feedback, zGold, zEuro, zNasdaq, zVIX are already in the pipeline and will be launched within a few weeks time.

As you can see, from the mainstream financial assets to crypto main assets, and even popular concept metaverse related index, with Zerogoki, you can mint any kind of assets you want to have access to.

Btw, if there are any fancy zAssets you hope to onboard within the zerogoki’s system, pls feel free to click https://snapshot.org/#/zerogoki.eth, and propose your ideas!

That’s it.

Question 4. Cool, sounds perfect, I do wanna dig into Zergoki’s system and try those fancy zAssets later! But now, let’s move on with the AMA first hahaha. I’m curious what role does the $REI token play in your ecosystem?

Antonio: The functions of REI as a protocol token include but are not limited to: system fees, minting synthetic assets, governance, and Duet ecosystem participation certificates.

1. REI is the main asset in the system and the ‘fuel’ of synthetic assets. The user burns REI in Lite Mint and issues zAsset. As more synthetic assets are minted, more REI will be burned, so the total amount of REI will decrease as the variety and quantity are more abundant in synthetic assets. On the other hand, the destruction of zAsset will increase the circulation of REI. Therefore, REI is a value bridge between Zerogoki’s synthetic assets and external assets.

2. Zerogoki’s mint/redeem will incur a small amount of trading fee, which is a certain percentage of burned assets. These assets are internal, and the source of asset value in the system is provided by REI, that is, the actual system uses REI to charge. This fee similar to “”minting tax”” is borne by minting users and charged by Zerogoki as protocol earning. In the short term, projects may choose to burn the collected fee, and the DAO will determine the use after the governance module goes live.

3. REI is the governance certificate of the Zerogoki. Users need to stake the REI in the governance module to participate in voting. The basic parameters and supporting assets of the current agreement are determined by the founding team and can be adjusted through DAO in the future. The content of decision-making includes but is not limited to synthetic asset listing/delisting, the calculation method, and proportion of mint taxation, the emission speed of liquidity incentives and the distribution of each pool, the use of project reserves etc.

4. As the first product officially launched in the Duet ecosystem, Zerogoki has very important experimental significance for the smooth launch of Duet’s first app-Shogoki. Duet will also regard Zerogoki users as early participants and supporters of the ecosystem. REI will serve as a medal for early participants and will reap the rewards of the project in the future expansion of the Duet ecosystem.

Question 5. Can you please tell us the current Zerogoki road map? How far has Zerogoki been developed at this time? and what will you realize in the future?

Antonio: In 2021, Zerogoki has 4 main goals to achieve:

1. Provide pressure test environment for Duet Lite Mint Module.

2. List more exoticon-chain derivatives.

3. Onboard governance module, let all REI holders participate in asset listing.

4. Distribute protocol revenue to benefit users and stakeholders of Zerogoki

The birth of Zerogoki stems from Duet’s attempts to innovate mechanism design. Zerogoki is the first algorithmic stable leveraged asset minting and trading protocol. We hope that in future Zerogoki will help the most exciting DeFi innovation and experimental product get delivered.

Second, Zerogoki’s mission is to take pressure tests for Duet protocol and educate potential users. Through a concise and clear framework, Duet ecological participants will quickly become familiar with and understand the practical application of the algorithm anchoring mechanism.

Last, Zerogoki will help to bridge transactions of traditional assets on the blockchain.

Host: Thanks, that’s the last question for Section 2.

Host: For Section 3，let’s answer some Q&A from Bitwell twitter.

1/What do you think is zerogoki advantage over its competitors? Is there any special about zerogoski?

Antonio: Zerogoki’s duet protocol’s experimental product, compared with competitors, it has a series of advantages.

In terms of assets listing, Zerogoki supports the minting and trading of financial assets including cryptocurrency, commodities, forex, bonds, stocks, and financial index. However, to put more pressure on the system, Zerogoki presents leveraged tokens. For example, gold supported by Zerogoki is a 3X bull tokens, recorded as zGOLD3L. The price principle of leveraged tokens refers to FTX leveraged tokens. For users of the concept of leveraged tokens and price adjustment methods, please read the price mechanism of leveraged tokens carefully in following sectors.

2/On moving forward through your roadmap, what are your most important next priorities?

Antonio: After around 1 month’s release, we’ve gained pretty good community, liquidity, and volume, we’ve had roughly 100k followers through all the social media platforms. For the next stage, we’ll mainly focus on expanding the use cases of zerogoki’s $REI and $zUSD, large-scale tvl (over $500m )defi protocols’ cooperation will be disclosed soon, and we’re also working hard on the cross-chain module, which is expected to be usable within the month.

3/Can Zerogoki provide an overview of your tokenomics? Will the design of the token increase and decrease with the success of the platform, does it include any scarce pathways, such as equity, storage, or burning?

Antonio: Sure, zerogoki’s main token is REI. REI is Zerogoki’s core asset, which is used as a fuel for synthetic leveraged assets. For every $1 of synthetic assets minted, $1 of REI will be burned. Synthetic assets and REI are two-way interoperable, and the same redemption of REI of $1 needs to burn synthetic assets worth $1. In the long run, as the supply of synthetic assets grows, the total amount of REI will enter deflation, and the actual total amount will gradually decrease.

The initial circulation of REI is 42,000,000 and the distribution plan is as follows:

4/What Features of Zerogoki I must have to share to my friends so my friends will believe me that Zerogoki is very great?

Antonio: Zerogoki is the world’s first Algorithm Pegged Leveraged Token Minting and Trading Protocol. You can experience world-class synthetic assets minting and burning progress, which’s hard to be seen in other system. For now, we support these assests to be minted:zBTC 3L／3S

zETH 3L／3S

zUST 20L/S US 10-year Treasury Bonds

zMVI 2L／S Metaverse Index

In the long term, I believe you can mint any kind of assets you prefer.

5/ What mechanism helps Zerogoki increase the scarcity of $REI tokens in the market? Zerogoki borrowers or lenders, what will encourage them to hold the $REI token?

Antonio: In the long run, as the supply of synthetic assets grows, the total amount of REI will enter deflation, and the actual total amount will gradually decrease.

Let’s dig into the use of REI in the zerogoki’s system:

Under the current design, the overall emission rate of REI will increase along with the increase of zAsset. The overall release cycle of liquidity incentives will be compressed to 1 year compared to 6 years in Duet. In the later stage, when the REI token reward is lower but transaction volume is higher, users‘ incentive for providing liquidity will be relying on transaction fees from the swap pool, active market-making to obtain arbitrage income, or actively participating in new developments in the system will also create profits for users.

The functions of REI as a protocol token include but are not limited to: system fees, minting synthetic assets, governance, and Duet ecosystem participation certificates.

REI is the main asset in the system and the valuable source of synthetic assets. The user burns REI in Lite Mint and issues zAsset. As more synthetic assets are minted, more REI will be burned, so the total amount of REI will decrease as the variety and quantity are more abundant in synthetic assets. On the other hand, the destruction of zAsset will increase the circulation of REI. Therefore, REI is a value bridge between Zerogoki’s synthetic assets and external assets.

Zerogoki’s mint/redeem will incur a small amount of trading fee, which is a certain percentage of burned assets. These assets are internal, and the source of asset value in the system is provided by REI, that is, the actual system uses REI to charge. This fee similar to “minting tax” is borne by minting users and charged by Zerogoki as protocol earning. In the short term, projects may choose to burn the collected fee, and the DAO will determine the use after the governance module goes live.

REI is the governance certificate of the Zerogoki. Users need to stake the REI in the governance module to participate in voting. The basic parameters and supporting assets of the current agreement are determined by the founding team and can be adjusted through DAO in the future. The content of decision-making includes but is not limited to synthetic asset listing/delisting, the calculation method, and proportion of mint taxation, the emission speed of liquidity incentives and the distribution of each pool, the use of project reserves etc.

As the first product officially launched in the Duet ecosystem, Zerogoki has very important experimental significance for the smooth launch of Duet’s first app-Shogoki. Duet will also regard Zerogoki users as early participants and supporters of the ecosystem. REI will serve as a medal for early participants and will reap the rewards of the project in the future expansion of the Duet ecosystem.

Host: Thank you all for the amazing questions. We have come to the end of today’s AMA event, thank you all for joining us.

Please don’t forget to visit Zerogoki’s website and BitWell web for more info.