One of the major challenges in the DeFi space is the inefficiency and complexity of perpetual futures trading. Traditional platforms often suffer from high fees, slow transaction times, and a lack of user-friendly interfaces. These issues can deter new users and create barriers to entry for those looking to explore DeFi opportunities.

Zaros Finance tackles these challenges head-on by offering a perpetual futures decentralized exchange (DEX) that is efficient and easy to use. The platform utilizes advanced technology like the Tree Proxy Pattern to enhance transaction speeds and reduce costs.

What is Zaros Finance?

Source: Zaros Finance

Zaros Finance is a Perpetuals DEX powered by Boosted (Re)Staking Vaults. Whether you’re a seasoned trader or new to the world of cryptocurrencies, Zaros is here to maximize your trading potential and enhance your yields on Arbitrum, with plans to expand to Monad soon.

Zaros, founded by Guilherme Bettanin, and Pedro Bergamini, connects Liquid Re(Staking) Tokens (LSTs & LRTs) with Perpetual Futures, offering opportunities to amplify your yield through innovative ZLP Vaults. With the ability to trade with leverage of up to 100x, Zaros empowers you to take control of your investments like never before.

Key features of Zaros Finance

• Cross-Margin Trading Accounts: Zaros utilizes Cross-Margin Trading Accounts, enabling easy and flexible position backing. Users can use over 15 tokens as margin collateral and have the option to create multiple trading accounts as needed.
• Leverage Trade, FX, and Commodities: The platform opens doors to diverse markets, including crypto, FX, and commodities. With Boosted (Re)Staking Vaults, you can supercharge your LRTs and LSTs yields by earning zPoints and additional ETH from Zaros’ trading fees, all through intuitive ZLP Vaults.
• DEX with CEX-Like Experience: Zaros offers a seamless trading experience with social login integration and one-click transactions. You can log in with your email or Apple ID and effortlessly authenticate your first transaction during every session.
• ZLP Vaults: The ZLP Vaults are single-sided LPing smart contracts that lock the underlying collateral provided by Liquidity Providers (LPs) to increase the caps of Zaros perpetual futures markets.
• Skew and Open Interest Caps: Zaros markets have skew caps and open interest caps, resulting in higher TVL utilization than competitors.
• High-Frequency Trading: Zaros focuses on creating the best on-chain trading experience for derivatives on Arbitrum and Monad, offering high-frequency trading with deep liquidity and a wide variety of markets.

Tree Proxy Pattern - The Technology Behind Zaros Finance

The Tree Proxy Pattern is a novel modular proxy pattern solution designed by Zaros Finance to address key issues faced by large smart contract systems. This pattern simplifies the architecture, making it easier to navigate and reducing the risk of bugs.

How Does the Tree Proxy Work?

The Tree Proxy Pattern draws inspiration from several Ethereum Improvement Proposals (EIPs) like EIP-1822, EIP-2535, and EIP-7504. It incorporates their strengths while overcoming their limitations. It is also compatible with EIP-7201, allowing the use of well-audited libraries like OpenZeppelin. This compatibility enables the use of unlimited implementation contracts without complex terminology.

Key Benefits of Tree Proxy Pattern

• Simplified Terminology: The tree analogy provides an intuitive understanding of the system’s architecture.
• Modularity: The pattern is modular, allowing for easier scalability and maintenance.
• Compatibility: It supports integration with established standards and libraries, enhancing security and reliability.

TPP Structure Overview

• Leaf: Represents functions, the smallest unit within the architecture, thoroughly unit tested for reliability.
• Branch: Represents modules, a collection of functionalities grouped by logic or purpose.
• Root (Proxy): Acts as the entry point to the architecture, directing requests to appropriate modules.

Lookup Mechanism

• LookupNamespace: Central to the architecture, it facilitates efficient management and invocation of functionalities.
• LookupBranch: Provides refined control over the integration and execution of operations within the system.

Functional Flow

• Branches: Collections of leaves (functions) tested in isolation and ready for integration testing.
• Leaves: Functions undergo rigorous unit testing to verify performance and reliability.
• Namespace Functionalities and Storage: Functions are categorized and managed through namespaces, facilitating identification and execution.

Zaros Protocol Architecture

Zaros Core

Zaros Core introduces a revolutionary framework leveraging the Tree Proxy Pattern, integrating the Perpetuals and Market Making Engines. This ecosystem is designed to benefit traders and liquidity providers, offering both parties a seamless fusion of opportunities.

External Actors

1. Chainlink: Chainlink is a crucial infrastructure provider that supplies robust and secure Data Feeds, Streams, and Keepers services. These are essential for maintaining the ecosystem’s reliability and connectivity with the broader blockchain universe.

2. AccountNFT: Based on the ERC-721 standard, AccountNFT represents a trader’s account within the ecosystem. This enables traders to manage multiple accounts, each tailored to different trading strategies, enhancing flexibility and personalization.

3. USDz: USDz is the native stablecoin of the Zaros ecosystem. It is an overcollateralized stablecoin backed by LPs’ LSTs & LRTs.

USDz

USDz is a central component of Zaros’ architecture as its settlement asset. When traders realize profit, USDz is minted and sent to their account’s margin. Then, it can be swapped to any of the ZLP Vault’s underlying collateral priced at $1 using a low-latency oracle provider. Furthermore, these vaults over-collateralize the stablecoin.

Key Features of USDz

1. Settlement Asset: When traders realize profit, USDz is minted and sent to their account’s margin. It can then be swapped to any of the ZLP Vaults’ underlying collateral priced at $1 using a low-latency oracle provider.

2. Overcollateralization: USDz’s stability is achieved through a combination of strategies and collateral within the protocol. This includes Boosted (Re)Staking Vaults where users deposit collateral like Lido’s $wstETH and EtherFi’s $weETH.

3. Triple Caps: Open Interest, skew, and minting caps ensure that USDz is always significantly overcollateralized. These mechanisms allow profitable traders to exit the system by selling liquid collateral assets provided by LPs in the ZLP Vaults.

Perps Engine

The Zaros Perps Engine is a sophisticated, decentralized engine crafted for the Perpetuals DEX. It showcases an advanced, efficient, and future-proof structure through the implementation of the innovative Tree Proxy Pattern. This pattern underpins the engine’s design, facilitating a blend of modularity, performance, and easy upgrades.

Core Components

Branches:

• LookupBranch.sol: Manages the namespace’s lookup operations.
• SettlementBranch.sol: Handles all settlement processes.
• PerpsAccountBranch.sol: Oversees accounts and their interactions.
• PerpMarketBranch.sol: Controls the creation and management of perpetual markets.
• OrderBranch.sol: Facilitates order management and execution.
• LiquidationBranch.sol: Executes liquidation procedures for undercollateralized positions.
• GlobalConfigurationBranch.sol: Manages global settings and configurations.
• UpgradeBranch.sol: Lists delegated functions.

Leaves:

• Branch.sol: The base contract for all branches, defining common behaviors and functionalities.
• LookupTable.sol: A utility contract for efficient data lookup and retrieval.
• SettlementConfiguration.sol: Defines parameters and settings for the settlement process.
• MarketOrder.sol: Represents market orders within the system.
• Position.sol: Manages traders’ positions.
• PerpMarket.sol: Details the properties and behaviors of a perpetual market.
• MarketConfiguration.sol: Specifies market-specific settings and configurations.
• OrderFees.sol: Governs the fee structure for order processing.
• MarginCollateralConfiguration.sol: Outlines the collateral requirements and margin settings.
• PerpsAccount.sol: Contains account-specific data and logic.
• GlobalConfiguration.sol: Holds the global settings applicable across the Zaros platform.
• RootUpgrade.sol: Manages upgrades to the root (proxy) to introduce new functionalities or improvements.

Root

• Perps Engine: The core engine that powers the Zaros Perpetual Swaps ecosystem.

Market Making Engine

Zaros unveils an innovative Market Making Engine utilizing the Tree Proxy Pattern, which consists of Leaves, Branches, and a Root for its structure. This engine is supported by a modular architecture, including critical components such as FeeBranch.sol, CreditBranch.sol, CollateralBranch.sol, and ZLPBranch.sol. This setup lays the groundwork for a sturdy and flexible ecosystem.

Benefits to Liquidity Providers (LPs)

• USDz Backing: USDz is paid out to profitable positions and accounted as debt by the CreditBranch. Traders can swap USDz to any of the ZLP Vaults’ underlying collateral at any time, using Chainlink’s Data Streams prices for settlement. This ensures a smooth experience on Zaros while the system remains collateral agnostic, enabling the DAO to smoothly spin up new ZLP Vaults.
• Rewards: LPs allocate their collateral to specific ZLP Vaults designed for efficient asset management. By depositing Liquid Staking Tokens (LSTs) and Liquid Restaked Tokens (LRTs) into ZLP Vaults, LPs can earn up to 70% of trading fees generated, linking their success directly to the platform’s performance.

Zaros Products

Zaros Perpetuals DEX

Zaros Perpetuals DEX is an innovative DeFi protocol that merges Liquid (Re)Staking with Perpetual Futures markets. This integration fosters real yield generation and capital efficiency. It benefits LST and LRT holders by enabling them to lend their liquidity to support the creation of perpetual markets.

Oracles

Oracles play a crucial role in the decentralized ecosystem by incorporating accurate and decentralized data into the blockchain. For Zaros Perpetuals DEX, oracles underpin the reliability and efficiency of all transactions and operations. The platform uses Chainlink Data Feeds and Data Streams to connect Zaros smart contracts with aggregated pricing data.

Key Features

• Chainlink Data Feeds: Provide secure, transparent access to aggregated pricing data, essential for the dependability of Zaros Perpetuals DEX.
• Chainlink Data Streams: Offer real-time, low-latency market data delivery off-chain, which can be verified on-chain, enabling Zaros Perpetuals DEX to match the performance of centralized exchanges without sacrificing transparency or decentralization.

Keepers

The efficiency and stability of the Zaros ecosystem are upheld by two principal Keepers. These specialized entities ensure seamless market dynamics and integrity.

Key Functions of Keepers

• Liquidation Process: Keepers continuously monitor positions to ensure they meet maintenance margin requirements, initiating liquidations proactively to uphold market stability.
• Market Orders: Activated by custom logic, these keepers execute market orders by opening and closing them.

Chainlink Automation

Chainlink Automation powers the keepers through custom logic triggers, ensuring reliable and accurate functionality. This robust framework is essential for the platform’s overall performance.

Markets

Zaros Perpetuals DEX offers traders access to a broad range of perpetual markets, including cryptocurrencies, FX, and commodities. Powered by Chainlink’s Data Streams and Data Feeds, the platform ensures traders receive high-quality, low-latency, and reliable market data, essential for success across diverse markets.

Earn (Re)Staking dApp

The Earn (Re)Staking Decentralized Application functions as the central hub for Liquidity Providers. LST and LRT holders can deposit their tokens into ZLP vaults and earn yields, making it a lucrative engagement for those looking to maximize their earnings within the ecosystem.

Boosted (Re)Staking Vaults

Boosted (Re)Staking Vaults are advanced vaults designed to maximize yield generation for liquidity providers (LPs). These vaults offer varying levels of rewards, ranging from dual to triple, quadruple, or more, explicitly labeled for easy identification.

Key Features

• Stacking Rewards: Each vault is categorized based on the number of rewards it offers, allowing investors to understand the potential yield at a glance.
• Comprehensive Yield Generation: Participants in these vaults earn through a combination of trading fees from the Perps DEX, zPoints, and other incentives from partner integrations, delivering a multi-faceted income stream.

Integrations

The Earn dApp seamlessly integrates with a diverse range of Liquid Staking Tokens (LSTs) and Liquid Reward Tokens (LRTs) projects. This includes prominent projects such as Lido LST (wstETH), EtherFi LRT (weETH), Bedrock LRT (uniETH), and Dinero LST (pxETH).

Getting Started with Zaros Finance Platform

How to Create a Trading Account

1. Access the Zaros Website: Go to Zaros Finance and click on the “Launch dApp” button.

1. Connect Your Wallet: Click “Connect Wallet” and choose your preferred wallet. Confirm the access in your wallet. If you’re not connected to the Arbitrum Sepolia Network, it will prompt you to switch networks.

2. Get Faucet Funds: If it’s your first time on the Arbitrum Sepolia Network, you’ll need faucet funds. You can get them from Alchemy Faucet or QuickNode Faucet.

1. Create Trading Account: Go to the Zaros dApp homepage and click on “Create Trading Account” in the top right corner.

2. Mint AccountNFT: Click the mint button on the left side of the screen and confirm the transaction in your wallet. Once confirmed, deposit funds into the Zaros dApp to finalize your Trading Account creation.

1. Deposit Funds: Click on “Deposit & Create Trading Account” on the Zaros dApp homepage.

2. Referral Code: To complete the account creation, you’ll need a referral code. If you don’t have one, you can get it from the Zaros Discord.

3. Ready to Trade: Once these steps are completed, you’re ready to trade on the Zaros dApp and compete in the trading league.

How to Trade on Zaros dApp

1. Order Entry: Input your order details in the order entry field.

2. Choose Margin Type: Select your margin type, initially available only in cross-margin mode.

3. Select Leverage and Position Size: Choose your leverage amount and position size. Optionally, tick the TP/SL box to set your desired triggers.

4. Limit Order: If placing a limit order, enter the limit price at which you wish to go long or short.

5. Take Profit/Stop Loss: Set the price at which you want to automatically take profit or close a position to prevent further losses. Alternatively, input the percentage change (ROI) you’d like.

6. Close Trade: You can close a trade at market once it is open.

How to Stake and Unstake Assets

1. Choose a Pool: Select one of the available pools to stake your Vaults.

2. Stake Assets: Click the “Stake” button, select the amount you want to stake, and confirm the transaction in your wallet. Your assets will be staked and start generating rewards.

3. Unstake Assets: To unstake, choose the liquidity pool, select the amount to unstake (minimum of 0.01), and click the “Unstake” button. Confirm the transaction in your wallet. Your assets will be unstaked and added to your balance.

Zaros Tokenomics

ZRS is an ERC-20 token that functions as the utility token for Zaros Finance. It has a total supply of 1,000,000,000 tokens and it’s distributed thus;

1. Investors: Early investors receive an allocation with a 6-month cliff and a 12-month vesting period.

2. Future Core Contributors: Tokens are allocated for upcoming core team members, with cliff and vesting periods to be determined.

3. IDO LBP: Tokens allocated for the Initial DEX Offering, launched through Fjord Foundry’s LBP, with no cliff or vesting.

4. Ecosystem Incentives (zPoints): Includes incentives for initial and ongoing protocol participation over the next 4 years, as well as airdrops.

5. Treasury: Reserved for operational needs, opportunistic fundraising, and ongoing expenses, with 0.75% at TGE, no cliff, and a vesting schedule to be determined.

6. Advisory: Tokens allocated to advisors with a 6-month cliff and an 18-month vesting period.

7. Core Contributors: Allocations for core team members with a 6-month cliff and a 24-month vesting period.

veZRS

The veZRS token adopts the ve80/20 system, resembling the vote escrow model but with an 80/20 Balancer Pool Token (BPT) instead of the raw ZRS token. veZRS is an NFT obtained through the deposit of LP tokens from the ZRS/ETH 80/20 pool on Arbitrum. This NFT carries voting power determined by token quantity and lock duration, with locking periods extending up to 1 year on Zaros. Longer lock times result in higher voting power.

Token Utilities

1. Trading Fees Distribution for veZRS Lockers: veZRS holders receive 15% of the trading fees from the Perpetuals DEX. The distribution is proportional to each holder’s voting power, which increases with the duration of the lock.

2. Voting Power: Locking ZRS tokens to acquire veZRS grants users a portion of the DEX’s trading fees and enhanced voting rights within the Zaros DAO. The duration of the token lock correlates with voting power, providing greater governance control to those more deeply invested in the protocol’s future.

3. Swap Fees Distribution: ZRS token holders benefit from the swap fees generated by the ZRS-ETH pool on Balancer, adding another layer of utility and reward for token ownership.

Fundraising Achievements

In a significant milestone, Zaros Finance has successfully raised $1.8 million in funding. This financial boost propels Zaros forward in its mission to revolutionize perpetual futures trading through the innovative use of Liquid Staking Tokens (LSTs) and Liquid Restaking Tokens (LRTs). The funding round saw participation from notable investors, including SNZ Holdings, Seven Capital, Cogitent Ventures, DCI Capital, Antony Sassano, Fernando Martinelli, Kieran Warwick, Andy Chen, and Kevin Lu.

Conclusion

Zaros Finance is poised for significant growth and development. The integration of advanced technologies and fundraising will further solidify Zaros’ position as a leading player in the market. If you’re looking to maximize your trading potential and earn substantial yields, Zaros Finance offers a comprehensive and user-friendly platform to achieve your goals. Join the Zaros community today, create your trading account, and start exploring the diverse opportunities available.