Pep-30 pokt dex

POKT Proposal:


  • Author(s): Germany, Jinx

  • Category: Proposal

  • Asks: 45,000 POKT


As Pocket Network aims to bring in liquidity by creating wPOKT, this proposal would also bring in liquidity through the networks to which the Pocket Foundation provides the free infrastructure. By using a multi-token DEX, token holders and node runners will be allowed to swap their tokens out for any non-native token from the supported blockchains currently hosted on the network.

The DEX itself will only be an alternative means of liquidity for the individual token-holder to have another option for clearing the POKT. Node providers can use the DEX, but the dex will cap how much POKT can be exchanged per wallet per pre-defined time.


POKT is listed on many exchanges, which have helped grow and provide more liquidity to the node runners supporting the network and general POKT holders.

We should consider opening multiple options by allowing the community access to the supported network liquidity pools, allowing token holders and node runners to trade out their POKT for any supported non-native token.

The foundation will have multiple treasuries (POKT and partner treasury) that access the foundation’s DEX. Anyone can enter the DEX, supply the different token pools with their native/ non-native token, and swap it for POKT or vice versa.

The foundation can charge a small fee of non-native (or native) tokens for facilitating and maintaining the DEX for them to profit and remain operational.

Motivation/ Rationale

As the relay count builds up and the only way to liquidate POKT tokens is through low-volume exchanges or OTC providers, the current demand is not keeping up with the supply generated.

This proposal can feed multiple birds with one scone by adding more liquidity through the current networks that are being hosted by allowing not only individuals with access tokens(e.g., ONE, SOL, MATIC, etc.) but also applications that have been allowed to supply their tokens for POKT to have access to the Pocket decentralized network.

To keep the supply circulating, it’s in the ecosystem’s best interest to lower the free relay applications from the POKT portal from 2M to 1M. By doing so, it provides a few opportunities:

  1. It feeds the DEX with non-native POKT and allows token holders to diversify their portfolios.
  2. Allow token POKT holders to leverage their POKT as an investment for the new/ developing project and grant the application “access” to the network.
  3. Allows the Pocket Foundation not to mint additional Pocket because the network provides the liquidity to trade on its behalf.

Dissenting Opinions

Acknowledge all opinions which disagree with the rationale of this proposal.

  • The portal allows any application who signed up 2M relays, so why do they need this?

    • Assumption - Most apps don’t go over the 2M relay mark, which can render the use-case for certain apps obsolete, but if we lower the relay count, it will further inform the markets of the value Pocket brings by showing the trading activity of said app.
  • Would this lower the price on the global exchanges?

    • I assume that as long as we have this DEX as an alternative, the market price will stay the same and will not be affected by massive volumes of POKT for USDC/T.
  • Token holders won’t use a DEX since it’s taking a fee.

    • It’s a fair assumption, but it’s essential to keep in mind that this is just another way of clearing POKT and preventing a lot of liquid POKT from being dumped on the exchanges in a convenient, expedited way that people will be willing to pay a fee for.


If the community agrees to this proposal, I request 45,000 POKT for the initial scope to map out how the DEX can operate efficiently and securely and draft the technical specs.


Copyright and related rights waived via CC0.


I don’t really understand why we would allocate time and ressources to build our own DEX, especially when there are already a lot of DEX out there.
wPOKT is going to be deployed on Polygon, so we should focus on bootstrapping liquidity for one particular DEX, Uniswap V3 for example.

Another problem you have raised is the fact that the Pocket Foundation provides free infrastructure which is not sustainable on the long term. Lowering the free relay applications from the POKT portal from 2M to 1M, should be introduced in another proposal I think.

don’t really understand why we would allocate time and resources to build our own DEX, especially when there are already a lot of DEX out there.

To clarify, I’m not saying we should re-invent the wheel and build from the ground up, but have an ecosystem-specific DEX that only funnels in the non-native tokens in one centralized place.

The incentivization for the foundation(if they choose to make it, or allow the community to make it on their behalf) is that they can take out a fee(native and non-native) to build, grow, and use it re-invest that back into the ecosystem and outreach initiatives.

wPOKT is going to be deployed on Polygon, so we should focus on bootstrapping liquidity for one particular DEX, Uniswap V3 for example.

This can still be done by the core team, but if we are solely focused on providing liquidity for one token, it negates the other opportunities for others to gain POKT through other non-native tokens and it just funnels people to one network(I.e polygon/eth) instead of the networks.

Lowering the free relay applications from the POKT portal from 2M to 1M, should be introduced in another proposal I think.

I totally agree and I probably will make another proposal after I get the communities buy-in and agree on the concept before we start initiating the next steps and creating a roadmap and R&D

1 Like

I’ve seen the time it takes to develop a good DEX, and it would take a really long time to develop even in other specific blockchains.

This is true, and if we were building from the ground up it could take a crazy amount of time that we don’t really have.

As of now, we could do several things:

  1. Create a wallet UI that is connected to the exchange wallet that contains the funds so it’s really just users adding/ taking funds from the exchange to transact securely
  2. Fork an existing DEX, reskin it, and modify it to fit our needs for the ecosystem’s benefits. - still specing out and researching btw .

Hi, Im involved in another project called sphere finance which has its own discord and related Dex,s and they offer something called Quantum Liquidity as a service, which is a way of helping other projects manage their finances, the project is quite complex but there are many videos explaining what they do on thir discord. Their dex dystopia launched less than 36 hours ago and is up to 15m tvl and counting
ill try and post the QLaas ()Quantum Liquidity as a Service) explanation here. But i think that they could help as they are fast becoming one of the major players on polygon
What is Quantum Liquidity?

Quantum Liquidity refers to a brand-new mechanism put in place by Sphere Finance, made possible by their governance acquisitions in Tetu Finance, a partner & founding member of the Polygon Alliance. After successfully incubating Tetu Finance into Sphere’s ecosystem, the protocols have worked on creating a way to grow liquidity via farming a portion of it while the liquidity pair is still active. This achieves an “artificial” volume which wouldn’t have been possible to achieve any other way. The way projects in DeFi conventionally gain liquidity comes in a myriad of different methods:

  1. Via mercenary liquidity - liquidity providers come and go depending on the returns they estimate they may earn from providing liquidity. This is not a stable way to earn liquidity as it can be withdrawn at any moment.

  2. For OHM-forks - via bonds, which give discounted tokens that are freshly minted in exchange for liquidity. This is an easily abused system where investors can sell their staked tokens, provide liquidity to earn discounted tokens, resell them and repeat the process. This causes the protocol to be diluted, making stakers earn less and less on their investments due to having a shrinking share of the market cap.

  3. Taxes - projects put a buy/sell tax, a portion of which goes to providing liquidity to the pair. While it is initially a good way to amass an awesome amount of tokens for the liquidity pair, it also suffers from continuous swaps to create the liquidity pair and is wholly dependent on trade volume, which is inherently volatile and extremely variable. If there isn’t enough volume, the liquidity grinds to a halt and is open to being depleted.

Sphere Finance aims to solve this by continuously farming a chunk of liquidity that is unused in vaults that are stimulated by Tetu Finance, thanks to the governance presence of Sphere in Tetu’s ecosystem. Sphere Finance currently owns 87% of all governance tokens in Tetu’s circulation, which makes way for deals to create vaults specifically meant for Quantum Liquidity. By V2, Sphere Finance will have moved its liquidity pair to TetuSwap, Tetu’s decentralized exchange, and earn yields on their liquidity and trade fees earned from their governance over Tetu. xTetu (locked Tetu) holders currently earn 33% of all trade fees earned from TetuSwap.
Why use Quantum Liquidity?

The answer is very simple - it is because it is a way to earn liquidity that does not depend on investors and mercenary market makers. We grow our treasury by ourselves, with our own vaults that are provided by our partner via our governance. On top of that, we organically earn our own trade fees, which we can use for various purposes. Traditionally, DEXes (Decentralized Exchanges) contract-sell all tokens once a quota is reached to earn income from the trade fees. This has a negative impact on the price, as it is a regularly high sell that is continuous & drains the liquidity that is meant for investors. We can either sell these fees ourselves to invest into alternative revenue streams, reinsert them back into the Liquidity Pool, or burn the tokens earned, which is the main function of our trade fees.

Quantum Liquidity as a Service (QLaaS)

Quantum Liquidity as a Service or QLaaS refers to a premium service pioneered and offered exclusively by Sphere Finance. As the name suggests, Sphere Finance offers projects (both upcoming and established) Quantum Liquidity for a premium fee. In exchange for this fee, Sphere Finance will create a vault for the project’s liquidity pair and farm it, so they can enjoy the ever growing liquidity. The flowchart below details the manner in which these deals are facilitated. (edited)
[10:50 PM]

links to this explanation are on the sphere finance discord

this is the link to the Dex Dystopia

It’s an admirable idea but the core team needs to focus on the core mission of Pocket Network, let’s the DEXers do their thing and we can do ours.

We just need to partner with DEX/CEX, but first we need to get wPOKT like

I agree, and the goal isn’t to take their focus from their day-to-day but to discuss an alternative for adding more liquidity using the assets (for what I assume) the treasury has locked in their wallet(s).

The community can focus on the DEX but depending on how much liquidity wPOKT brings, I still fundamentally think that we should look into other liquidity alternatives that can help offload the distribution of POKT isn’t just ETH native.