Aurora is a suite of DAPPs and protocols that make up a fully decentralized banking and financial network. The components of Aurora support the boreal, a decentralized stablecoin, and together enable global banking in the new currency. Revenue from the various components of Aurora will be used both to increase the asset reserves backing the boreal, allowing Aurora to expand boreal banking, and to provide economic incentives that ensure the system runs as designed.
The Boreal (BRL) is a price-stable decentralized cryptocurrency built on the Ethereum blockchain.
Boreal supply is carefully managed in order to match demand and maintain price stability, originally defined as parity with USD. Over time the price benchmark will transition to a basket of goods and commodities.
Boreals are backed by a combination of cryptocurrency reserves and debt. Loan repayment will generate demand as consumers repurchase boreals to meet their obligations on both principal and interest. Additional demand comes from the ability to use the boreal as payment on dapps. The first dapp to offer this is Aurora’s own IDEX, where transaction fees can be paid in boreals at a slight discount. Additional dapp partnerships will further expand the boreal use cases.
Decentralized Capital is a decentralized bank that provides loans to customers in the form of its new stablecoin, the boreal. Demand for boreals is generated due to its stable value and use in loan repayment. Decentralized Capital will engage in a number of other different activities analogous to open market operations with the ultimate goal of boreal price stability.
Decentralized Capital will utilize identity tools such as Uport and Civic along with credit tracking tools such as Bloom to identify and gauge loan risk for those who wish to borrow in boreals. DC’s mobile app will allow customers to opt in to a program whereby there phone usage data is sent to DC to assist in analyzing their credit risk.
IDEX is the first Ethereum based decentralized smart contract exchange to support real-time trading and high transaction throughput. IDEX is the most advanced Ethereum DEX, supporting limit and market orders, gas-free cancels and the ability to fill many trades at once.
IDEX consists of a smart contract, a trading engine, and a transaction processing arbiter. The smart contract is responsible for trustlessly storing all assets and executing trade settlement, and all trades must be authorized by the user’s private keys.
Unlike other decentralized exchanges, the IDEX smart contract is designed such that only the exchange is authorized to submit signed trades to Ethereum. This enables IDEX to control the order in which transactions are processed, separating the act of trading from final settlement. As users trade their exchange balances are updated in real-time, while simultaneously their private keys are used to authorize the trade in the contract. This authorization prevents users from rescinding any completed trades, and prevents IDEX from initiating any unauthorized trades.
Authorized transactions are passed to the arbiter which manages the queue of pending transactions, dispatching them in sequence to ensure that each trade is mined in the correct order and that the smart contract balances stay in synch with the exchange balances. By controlling the transaction sequence, IDEX provides the speed and user experience of centralized exchanges combined with the security and auditability of decentralized exchanges.
More detailed information on how IDEX works can be found here.
To help generate demand for boreals, IDEX provides a 5% trade fee discount to those who pay their fees using the stable currency. This discount creates buying pressure as traders are incentivized to pre-pay fees in the form of boreals in order to reduce their overall trading costs.
Post-launch on the mainnet the IDEX components will be upgraded into Snowglobe, a fully decentralized exchange protocol. Snowglobe operates on a sharded POS childchain connected to the main Ethereum chain. Snowglobe is open for any exchange to build on creating a network of real-time, high throughput evm-compatible asset exchanges all accessing the same shared orderbook and liquidity pool. Like IDEX, all exchanges on Snowglobe will utilize the state hop approach to achieve real time trading. The system consists of five main components working together: the Ethereum childchain contract for holding funds, the Snowglobe base chain, a shared distributed off-chain orderbook, and a local and global transaction dispatch arbiter.
Boreals will be available approximately 3 months after the mvp launch of IDEX.
Decentralized Capital will start offering small and limited loans approximately 1 year after the launch of IDEX.
Aurora in its current state is a semi-decentralized architecture. Full decentralization of the various components of Aurora will occur in phases, beginning with IDEX. A decentralized computing network is required to fully transition Aurora and host the AI banker. This will be the last component to be developed.
- October 2017 - IDEX launch on the mainnet. Semi-decentralized architecture consists of Ethereum smart contract plus central trading engine and transaction arbiter.
- October 2017 - API integration. Opening the platform via API access will enable the development of trading bots, increasing liquidity and improving market efficiency.
- Q4 2017 - Boreals go live with market making to stabilize the price
- Q3 2018 - Deploy Snowglobe childchain architecture, allowing IDEX to increase transaction throughput.
- Q4 2018 - Decentralization of the orderbook and transaction arbiter. This completes the transition of the current IDEX product to a decentralized childchain exchange.
- Q1 2019 - Margin trading support. Including this functionality in the protocol will put the UX on par with existing centralized exchanges.
- TBD - Launch the Snowglobe MVP, allowing other exchanges are now able to build on the protocol. This is dependent on the development of scaling solutions such as sharding.
- TBD - Fully decentralized Aurora mvp with Decentralized Capital boreal loans
Similar to other blockchain networks, Snowglobe requires a well-designed incentive structure to ensure that the integrity of the childchain protocol is not compromised. Aurora has its own native network token, AURA, that aligns the interests of Aurora and the Snowglobe operators. Income from Aurora is used to compensate those who stake their AURA and provide security for the Snowglobe network. AURA staking aligns the economic interests of the operators with the health of the network, and makes it extremely costly for any would be attacker to disrupt operations.
Aurora is implementing a crypto rewards program, enabled by the AURA token, to jump-start exchange usage and liquidity and encourage the creation of limit orders on IDEX.
Market makers who place and execute limit orders on any IDEX market are eligible to receive AURA token grants. 20% of the total AURA token supply will be dedicated to this Market Maker rewards program. AURA in the program will be granted at a rate of 1% of the total remaining Market Maker rewards AURA per month, i.e. 0.2% of the total AURA supply, or 2 million AURA, will be distributed in the first month. With each additional month, the absolute number of AURA rewards will be slightly reduced, providing an incentive for market makers to join early and ensuring that the rewards program can continue indefinitely.
Traders receive AURA proportional to the fees they spend on their limit orders. For example, if three traders trade during a one month period with trader A paying 5 eth in fees, trader B paying 2 eth in fees and trader C paying 3 eth in fees, they will receive 50%, 20% and 30% of the total distributed that month respectively. The earned amounts can be augmented by up to 2x by owning membership tokens.
IDXM (previously DVIP) is a crypto membership that entitles the holder to free or discounted trades on IDEX until the year 2021 and double market making rewards for life*. IDXM holders will also receive an airdrop of AURA tokens, the staking currency of the Aurora network. Addresses holding any amount of IDXM will receive AURA at a rate of 50,000 AURA per 1 IDXM. The airdrop will occur after the end of the sale and before the IDXM unfreeze. A total of 2,000 IDXM exist, and Aurora Labs is selling 1,600 in our token sale.
*Users cannot use more than one benefit per trade