Euphoria DAO Documentation
Protocol Overview
Euphoria DAO is a decentralized protocol built on Base L2 (Ethereum Layer 2) that implements Protocol Owned Liquidity (POL) with an autonomous staking system. The protocol features progressive APY rewards, epoch-based progression, and algorithmic governance through AI-powered parameter adjustment.
Core Philosophy
- Reward Patience, Don't Punish Exits: No hard locks or withdrawal penalties
- Progressive Rewards: APY increases with time staked
- Autonomous Governance: AI-powered real-time parameter optimization
- Transparency: All mechanics are on-chain and verifiable
Key Metrics
- Network: Base L2 (Chain ID: 8453)
- Token: SMILE (ERC-20)
- Total Supply: 777,777,777,777,777
- Epoch Duration: 3 hours (10,800 seconds)
- Starting APY: 33%
- Maximum APY: 3,400%
SMILE Token
Token Specifications
- Name: Euphoria
- Symbol: $SMILE
- Decimals: 18
- Standard: ERC-20
- Total Supply: 777,777,777,777,777
- Network: Base L2
Token Features
Fixed Supply: The SMILE token has a fixed supply of 777,777,777,777,777 tokens minted at deployment. This large supply ensures sufficient runway for staking rewards even with high user participation. No additional minting function is available after deployment.
Trading Tax: 3.33% on all DEX trades (buy and sell). The tax recipient is the Treasury contract. This tax applies only to DEX swaps (Uniswap, Velodrome). Withdrawals from staking are NOT taxed. The purpose is to fund the treasury for staking rewards.
Staking System
The staking system allows users to lock SMILE tokens to earn progressively increasing APY rewards. The longer tokens are staked, the higher the APY becomes, with rewards automatically compounded.
Core Parameters
- Epoch Duration: 3 hours (10,800 seconds)
- Starting APY: 33%
- APY Growth Rate: ~51% per epoch
- Maximum APY: 3,400%
- Minimum Stake: 100 SMILE
Epoch System
Epochs are 3-hour time intervals that determine APY progression. Epoch 0 starts at 33% APY, progresses through epochs 1-65, and reaches maximum APY of 3,400% at epoch 66. After epoch 66, APY remains at 3,400%.
Formula: APY = min(33% + (epoch × 51%), 3,400%)
Protocol-Owned Liquidity & Minting
Minting allows users to bond USDC to receive SMILE tokens at a discount while creating permanent protocol-owned liquidity. Minted tokens unlock linearly over 66 epochs.
How It Works
- User bonds USDC to the protocol
- Receives SMILE tokens at a discount (25-40% during bootstrap, 33% baseline)
- Tokens unlock linearly over 66 epochs
- The LP tokens stay with the protocol forever, creating permanent liquidity
Mint & Stake
Users can claim progressive unlocks from minting and add them to their staked position without affecting APY progression.
APY Mechanics
The APY grows linearly with each epoch. With daily compounding, the effective APY reaches approximately 28,000,000% at epoch 66, though the displayed nominal APY is capped at 3,400%.
APY Progression
Rewards are calculated using compound interest. Each epoch applies the 1.0168 multiplier. Rewards compound automatically (no manual claiming needed for APY progression). Users can claim rewards without withdrawing stake.
Withdrawal System
The withdrawal system implements APY progression retention. Your APY increases over time as you stake, and the protocol allows you to preserve this progression when making partial withdrawals.
Adding to Your Stake
Adding more tokens to an existing stake does NOT reset your APY progression. When you add tokens, they are combined with your existing position and your start epoch remains unchanged. This means your accumulated APY growth continues uninterrupted for the entire combined stake amount.
Partial Withdrawals
Each partial withdrawal preserves APY progression. When you unstake only a portion of your tokens, the protocol applies a retention mechanism to your remaining stake. The retention is calculated based on how many epochs you've held your position, up to a maximum of 66 epochs. Your remaining stake's APY will be adjusted based on retained epochs, ensuring you don't lose all your progress.
Retention Formula: For each partial withdrawal, retention percent = min(epochsStaked, 66), and epochs retained = ceil((retentionPercent × 66) / 100). Your new start epoch is moved forward to current epoch minus retained epochs.
Full Withdrawal
Full withdrawal resets progression entirely. If you unstake your entire position, the stake is completely deleted from the protocol. If you stake again later, it will be treated as a new position starting from the base APY of 33%.
Summary
- Adding to Stake: APY progression is preserved
- Partial Unstake: APY progression is partially retained based on epochs staked
- Full Unstake: APY progression is completely reset
- No Fees: No taxes or fees on withdrawals
Contract Architecture
Core Contracts
SMILE Token Contract: Standard ERC-20 implementation with fixed supply, 3.33% trading tax on DEX swaps, and tax exemptions for owner, treasury, and DEX routers.
Staking Contract: Epoch-based APY progression, progress retention system, reward calculation and distribution, and treasury integration.
Treasury Contract: Manages protocol assets and distributes staking rewards.
AI-Guided Protocol Governance
The protocol uses AI-powered governance to optimize parameters in real-time. Large Language Models analyze protocol health and adjust parameters automatically to maximize protocol lifespan and user returns.
Decision Framework
The AI [claude-3-haiku-20240307] monitors various metrics including treasury health, deposit velocity, withdrawal patterns, and whale activity to make optimal parameter adjustments. Actively monitors and adjusts three core variables: APY rates (33-3400%), mint discount (25-40%), and withdrawal delays (0-4 epochs).
Through continuous feedback loops and guided analysis, the AI learns to balance incentives that maximize both protocol longevity and user retention. The autonomous system manages treasury monetary policy, including strategic decisions on liquidity provision, token buybacks, and protocol investments.
Security Features
Contract Security
- Reentrancy Protection: Uses OpenZeppelin's ReentrancyGuard
- Safe Token Transfers: Uses SafeERC20 for all token operations
- Access Control: Owner-only functions for sensitive operations
- Input Validation: Checks for zero amounts, sufficient balances
- Treasury Validation: Verifies treasury has sufficient balance before rewards
User Protection
- Minimum Stake: 100 SMILE prevents dust attacks
- No Rug Pulls: Treasury is separate contract, not owner-controlled
- Transparent Calculations: All formulas are on-chain and verifiable
- No Hidden Fees: All fees are explicit (only trading tax, not withdrawals)
Technical Specifications
Mathematical Formulas
APY Calculation: APY(epoch) = min(33% + (epoch × 51%), 3,400%)
Compound Growth: Value = Principal × (1.0168 ^ epochs)
Progress Retention: Retention = min(epochsStaked, 66), New Epoch = (currentEpoch × retention) / 100
Gas Estimates
- stake(): ~150,000 gas
- withdraw(): ~200,000 gas
- claimRewards(): ~180,000 gas