Advanced DeFi and AMM Contracts Implementation

[JosueBrenes]

Description

Extend TrustBridge beyond basic lending/borrowing by implementing an Automated Market Maker (AMM), yield farming contracts, and advanced DeFi features. This will create a comprehensive DeFi ecosystem including DEX functionality, liquidity mining, synthetic assets, and options trading.

Current Limitations

Missing DeFi Features

• No DEX or trading functionality
• Limited yield generation opportunities
• Basic lending/borrowing only
• No liquidity incentives
• Missing synthetic asset creation

Market Gaps

• Users cannot trade assets directly
• No AMM for price discovery
• Limited ways to earn yield
• No advanced financial instruments

What to Implement

• Automated Market Maker (AMM) with constant product formula
• Liquidity Mining contracts for yield farming
• Synthetic Asset creation and management
• Basic Options contracts for derivatives
• Flash Loan optimization
• Advanced yield strategies

Acceptance Criteria

• AMM functional for asset swaps with proper pricing
• Liquidity providers can earn fees and rewards
• Yield farming operational with multiple reward tokens
• Synthetic assets can be created and traded
• Options contracts working for basic puts/calls
• Flash loans optimized and integrated with AMM
• Advanced yield strategies implemented

Technical Requirements

New Contracts to Create

1. AMM Contract

   • Path: contracts/amm/
   • Purpose: Automated market maker for asset swaps

2. Liquidity Mining Contract

   • Path: contracts/liquidity-mining/
   • Purpose: Yield farming and LP token rewards

3. Synthetic Asset Factory

   • Path: contracts/synthetic-asset-factory/
   • Purpose: Create and manage synthetic assets

4. Options Contract

   • Path: contracts/options/
   • Purpose: Basic options trading functionality

5. Yield Strategy Manager

   • Path: contracts/yield-strategy-manager/
   • Purpose: Advanced yield optimization strategies

6. Flash Loan Router

   • Path: contracts/flash-loan-router/
   • Purpose: Optimized flash loan routing and arbitrage

Implementation Details

AMM Contract (Uniswap V2 Style)

// contracts/amm/src/contract.rs
use soroban_sdk::{contract, contractimpl, Address, Env, String, symbol_short};

#[contract]
pub struct AMM;

#[contractimpl]
impl AMM {
    /// Initialize AMM pair
    pub fn initialize(
        env: Env,
        token_a: Address,
        token_b: Address,
        fee_rate: u32 // Basis points (e.g., 30 = 0.3%)
    ) -> Result<(), AMMError> {
        if env.storage().instance().has(&DataKey::Initialized) {
            return Err(AMMError::AlreadyInitialized);
        }

        // Ensure token order (token_a < token_b for consistency)
        let (token_0, token_1) = if token_a < token_b {
            (token_a, token_b)
        } else {
            (token_b, token_a)
        };

        env.storage().instance().set(&DataKey::Token0, &token_0);
        env.storage().instance().set(&DataKey::Token1, &token_1);
        env.storage().instance().set(&DataKey::FeeRate, &fee_rate);
        env.storage().instance().set(&DataKey::TotalSupply, &0i128);
        env.storage().instance().set(&DataKey::Initialized, &true);

        emit_pair_created(&env, token_0, token_1, fee_rate);
        Ok(())
    }

    /// Add liquidity to the pool
    pub fn add_liquidity(
        env: Env,
        user: Address,
        amount_a_desired: i128,
        amount_b_desired: i128,
        amount_a_min: i128,
        amount_b_min: i128
    ) -> Result<(i128, i128, i128), AMMError> {
        user.require_auth();

        let token_0 = Self::get_token_0(&env);
        let token_1 = Self::get_token_1(&env);

        let (reserve_0, reserve_1) = Self::get_reserves(&env);
        let total_supply = Self::get_total_supply(&env);

        let (amount_0, amount_1, liquidity) = if total_supply == 0 {
            // First liquidity addition
            let initial_liquidity = Self::sqrt((amount_a_desired * amount_b_desired) as u128) as i128;
            (amount_a_desired, amount_b_desired, initial_liquidity)
        } else {
            // Calculate optimal amounts based on current reserves
            let amount_b_optimal = Self::quote(amount_a_desired, reserve_0, reserve_1);
            let (amount_0, amount_1) = if amount_b_optimal <= amount_b_desired {
                if amount_b_optimal < amount_b_min {
                    return Err(AMMError::InsufficientBAmount);
                }
                (amount_a_desired, amount_b_optimal)
            } else {
                let amount_a_optimal = Self::quote(amount_b_desired, reserve_1, reserve_0);
                if amount_a_optimal > amount_a_desired || amount_a_optimal < amount_a_min {
                    return Err(AMMError::InsufficientAAmount);
                }
                (amount_a_optimal, amount_b_desired)
            };

            // Calculate liquidity tokens to mint
            let liquidity = Self::min(
                (amount_0 * total_supply) / reserve_0,
                (amount_1 * total_supply) / reserve_1
            );

            (amount_0, amount_1, liquidity)
        };

        // Transfer tokens to contract
        token::Client::new(&env, &token_0).transfer(&user, &env.current_contract_address(), &amount_0);
        token::Client::new(&env, &token_1).transfer(&user, &env.current_contract_address(), &amount_1);

        // Mint LP tokens
        Self::mint_lp_tokens(&env, &user, liquidity);

        // Update reserves
        Self::update_reserves(&env, reserve_0 + amount_0, reserve_1 + amount_1);

        emit_liquidity_added(&env, user, amount_0, amount_1, liquidity);
        Ok((amount_0, amount_1, liquidity))
    }

    /// Remove liquidity from the pool
    pub fn remove_liquidity(
        env: Env,
        user: Address,
        liquidity: i128,
        amount_a_min: i128,
        amount_b_min: i128
    ) -> Result<(i128, i128), AMMError> {
        user.require_auth();

        let total_supply = Self::get_total_supply(&env);
        if liquidity > total_supply || liquidity <= 0 {
            return Err(AMMError::InvalidLiquidityAmount);
        }

        let (reserve_0, reserve_1) = Self::get_reserves(&env);

        // Calculate token amounts to return
        let amount_0 = (liquidity * reserve_0) / total_supply;
        let amount_1 = (liquidity * reserve_1) / total_supply;

        if amount_0 < amount_a_min || amount_1 < amount_b_min {
            return Err(AMMError::InsufficientAmount);
        }

        // Burn LP tokens
        Self::burn_lp_tokens(&env, &user, liquidity);

        // Transfer tokens back to user
        let token_0 = Self::get_token_0(&env);
        let token_1 = Self::get_token_1(&env);

        token::Client::new(&env, &token_0).transfer(&env.current_contract_address(), &user, &amount_0);
        token::Client::new(&env, &token_1).transfer(&env.current_contract_address(), &user, &amount_1);

        // Update reserves
        Self::update_reserves(&env, reserve_0 - amount_0, reserve_1 - amount_1);

        emit_liquidity_removed(&env, user, amount_0, amount_1, liquidity);
        Ok((amount_0, amount_1))
    }

    /// Swap exact tokens for tokens
    pub fn swap_exact_tokens_for_tokens(
        env: Env,
        user: Address,
        amount_in: i128,
        amount_out_min: i128,
        token_in: Address,
        token_out: Address
    ) -> Result<i128, AMMError> {
        user.require_auth();

        let token_0 = Self::get_token_0(&env);
        let token_1 = Self::get_token_1(&env);

        // Validate tokens
        if (token_in != token_0 && token_in != token_1) ||
           (token_out != token_0 && token_out != token_1) ||
           (token_in == token_out) {
            return Err(AMMError::InvalidTokenPair);
        }

        let (reserve_in, reserve_out) = if token_in == token_0 {
            Self::get_reserves(&env)
        } else {
            let (r0, r1) = Self::get_reserves(&env);
            (r1, r0)
        };

        // Calculate amount out with fee
        let amount_out = Self::get_amount_out(amount_in, reserve_in, reserve_out, Self::get_fee_rate(&env))?;

        if amount_out < amount_out_min {
            return Err(AMMError::InsufficientOutputAmount);
        }

        // Execute swap
        token::Client::new(&env, &token_in).transfer(&user, &env.current_contract_address(), &amount_in);
        token::Client::new(&env, &token_out).transfer(&env.current_contract_address(), &user, &amount_out);

        // Update reserves
        let (new_reserve_0, new_reserve_1) = if token_in == token_0 {
            (reserve_in + amount_in, reserve_out - amount_out)
        } else {
            (reserve_out - amount_out, reserve_in + amount_in)
        };

        Self::update_reserves(&env, new_reserve_0, new_reserve_1);

        emit_swap(&env, user, token_in, token_out, amount_in, amount_out);
        Ok(amount_out)
    }

    /// Flash loan implementation
    pub fn flash_loan(
        env: Env,
        borrower: Address,
        token: Address,
        amount: i128,
        data: soroban_sdk::Bytes
    ) -> Result<(), AMMError> {
        borrower.require_auth();

        let initial_balance = token::Client::new(&env, &token).balance(&env.current_contract_address());

        // Transfer tokens to borrower
        token::Client::new(&env, &token).transfer(&env.current_contract_address(), &borrower, &amount);

        // Call borrower's flash loan callback
        env.invoke_contract(&borrower, &symbol_short!("flash_cb"), &(token.clone(), amount, data));

        // Check tokens were returned with fee
        let fee = Self::calculate_flash_loan_fee(&env, amount);
        let final_balance = token::Client::new(&env, &token).balance(&env.current_contract_address());

        if final_balance < initial_balance + fee {
            return Err(AMMError::FlashLoanNotRepaid);
        }

        emit_flash_loan(&env, borrower, token, amount, fee);
        Ok(())
    }

    // Helper functions
    fn get_amount_out(
        amount_in: i128,
        reserve_in: i128,
        reserve_out: i128,
        fee_rate: u32
    ) -> Result<i128, AMMError> {
        if amount_in <= 0 || reserve_in <= 0 || reserve_out <= 0 {
            return Err(AMMError::InsufficientLiquidity);
        }

        // Apply fee (fee_rate in basis points)
        let amount_in_with_fee = amount_in * (10000 - fee_rate as i128) / 10000;
        let numerator = amount_in_with_fee * reserve_out;
        let denominator = reserve_in + amount_in_with_fee;

        Ok(numerator / denominator)
    }

    fn quote(amount_a: i128, reserve_a: i128, reserve_b: i128) -> i128 {
        (amount_a * reserve_b) / reserve_a
    }

    fn sqrt(y: u128) -> u128 {
        if y > 3 {
            let mut z = y;
            let mut x = y / 2 + 1;
            while x < z {
                z = x;
                x = (y / x + x) / 2;
            }
            z
        } else if y != 0 {
            1
        } else {
            0
        }
    }

    fn min(a: i128, b: i128) -> i128 {
        if a < b { a } else { b }
    }
}

Liquidity Mining Contract

// contracts/liquidity-mining/src/contract.rs
use soroban_sdk::{contract, contractimpl, Address, Env, Vec, Map};

#[contract]
pub struct LiquidityMining;

#[contractimpl]
impl LiquidityMining {
    /// Initialize liquidity mining program
    pub fn initialize(
        env: Env,
        admin: Address,
        reward_token: Address,
        start_time: u64,
        end_time: u64,
        total_rewards: i128
    ) -> Result<(), MiningError> {
        if env.storage().instance().has(&DataKey::Initialized) {
            return Err(MiningError::AlreadyInitialized);
        }

        env.storage().instance().set(&DataKey::Admin, &admin);
        env.storage().instance().set(&DataKey::RewardToken, &reward_token);
        env.storage().instance().set(&DataKey::StartTime, &start_time);
        env.storage().instance().set(&DataKey::EndTime, &end_time);
        env.storage().instance().set(&DataKey::TotalRewards, &total_rewards);
        env.storage().instance().set(&DataKey::RewardRate, &(total_rewards / (end_time - start_time) as i128));
        env.storage().instance().set(&DataKey::Initialized, &true);

        Ok(())
    }

    /// Add a pool to the mining program
    pub fn add_pool(
        env: Env,
        admin: Address,
        lp_token: Address,
        allocation_points: u32
    ) -> Result<(), MiningError> {
        admin.require_auth();
        Self::require_admin(&env, &admin)?;

        if env.storage().persistent().has(&DataKey::Pool(lp_token.clone())) {
            return Err(MiningError::PoolAlreadyExists);
        }

        let pool = Pool {
            lp_token: lp_token.clone(),
            allocation_points,
            last_reward_time: env.ledger().timestamp(),
            accumulated_reward_per_share: 0,
            total_staked: 0,
        };

        env.storage().persistent().set(&DataKey::Pool(lp_token.clone()), &pool);

        // Update total allocation points
        let total_alloc = Self::get_total_allocation_points(&env);
        env.storage().instance().set(&DataKey::TotalAllocationPoints, &(total_alloc + allocation_points));

        emit_pool_added(&env, lp_token, allocation_points);
        Ok(())
    }

    /// Stake LP tokens
    pub fn stake(
        env: Env,
        user: Address,
        lp_token: Address,
        amount: i128
    ) -> Result<(), MiningError> {
        user.require_auth();

        let mut pool = Self::get_pool(&env, &lp_token)?;
        let mut user_info = Self::get_user_info(&env, &lp_token, &user).unwrap_or_default();

        // Update pool rewards
        Self::update_pool(&env, &mut pool)?;

        // Calculate pending rewards for user
        if user_info.amount > 0 {
            let pending = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128 - user_info.reward_debt;
            if pending > 0 {
                Self::safe_reward_transfer(&env, &user, pending)?;
            }
        }

        // Transfer LP tokens to contract
        token::Client::new(&env, &lp_token).transfer(&user, &env.current_contract_address(), &amount);

        // Update user info
        user_info.amount += amount;
        user_info.reward_debt = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128;

        // Update pool total
        pool.total_staked += amount;

        // Save updates
        env.storage().persistent().set(&DataKey::Pool(lp_token.clone()), &pool);
        env.storage().persistent().set(&DataKey::UserInfo(lp_token.clone(), user.clone()), &user_info);

        emit_stake(&env, user, lp_token, amount);
        Ok(())
    }

    /// Unstake LP tokens and claim rewards
    pub fn unstake(
        env: Env,
        user: Address,
        lp_token: Address,
        amount: i128
    ) -> Result<(), MiningError> {
        user.require_auth();

        let mut pool = Self::get_pool(&env, &lp_token)?;
        let mut user_info = Self::get_user_info(&env, &lp_token, &user)
            .ok_or(MiningError::NoStakeFound)?;

        if user_info.amount < amount {
            return Err(MiningError::InsufficientStake);
        }

        // Update pool rewards
        Self::update_pool(&env, &mut pool)?;

        // Calculate and transfer pending rewards
        let pending = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128 - user_info.reward_debt;
        if pending > 0 {
            Self::safe_reward_transfer(&env, &user, pending)?;
        }

        // Update user info
        user_info.amount -= amount;
        user_info.reward_debt = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128;

        // Update pool total
        pool.total_staked -= amount;

        // Transfer LP tokens back to user
        token::Client::new(&env, &lp_token).transfer(&env.current_contract_address(), &user, &amount);

        // Save updates
        env.storage().persistent().set(&DataKey::Pool(lp_token.clone()), &pool);
        if user_info.amount > 0 {
            env.storage().persistent().set(&DataKey::UserInfo(lp_token.clone(), user.clone()), &user_info);
        } else {
            env.storage().persistent().remove(&DataKey::UserInfo(lp_token, user.clone()));
        }

        emit_unstake(&env, user, lp_token, amount);
        Ok(())
    }

    /// Claim pending rewards without unstaking
    pub fn claim_rewards(
        env: Env,
        user: Address,
        lp_token: Address
    ) -> Result<i128, MiningError> {
        user.require_auth();

        let mut pool = Self::get_pool(&env, &lp_token)?;
        let mut user_info = Self::get_user_info(&env, &lp_token, &user)
            .ok_or(MiningError::NoStakeFound)?;

        // Update pool rewards
        Self::update_pool(&env, &mut pool)?;

        // Calculate pending rewards
        let pending = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128 - user_info.reward_debt;

        if pending > 0 {
            Self::safe_reward_transfer(&env, &user, pending)?;
        }

        // Update user reward debt
        user_info.reward_debt = (user_info.amount * pool.accumulated_reward_per_share) / 1e12 as i128;

        env.storage().persistent().set(&DataKey::Pool(lp_token.clone()), &pool);
        env.storage().persistent().set(&DataKey::UserInfo(lp_token, user.clone()), &user_info);

        emit_rewards_claimed(&env, user, pending);
        Ok(pending)
    }

    fn update_pool(env: &Env, pool: &mut Pool) -> Result<(), MiningError> {
        let current_time = env.ledger().timestamp();
        let end_time = Self::get_end_time(env);

        if current_time <= pool.last_reward_time {
            return Ok(());
        }

        if pool.total_staked == 0 {
            pool.last_reward_time = current_time.min(end_time);
            return Ok(());
        }

        let multiplier = Self::get_multiplier(pool.last_reward_time, current_time.min(end_time));
        let reward_rate = Self::get_reward_rate(env);
        let total_alloc = Self::get_total_allocation_points(env);

        let pool_reward = (multiplier * reward_rate * pool.allocation_points as i128) / total_alloc as i128;
        pool.accumulated_reward_per_share += (pool_reward * 1e12 as i128) / pool.total_staked;
        pool.last_reward_time = current_time.min(end_time);

        Ok(())
    }

    fn get_multiplier(from: u64, to: u64) -> i128 {
        (to - from) as i128
    }
}

#[derive(Clone, Debug)]
pub struct Pool {
    pub lp_token: Address,
    pub allocation_points: u32,
    pub last_reward_time: u64,
    pub accumulated_reward_per_share: i128,
    pub total_staked: i128,
}

#[derive(Clone, Debug, Default)]
pub struct UserInfo {
    pub amount: i128,
    pub reward_debt: i128,
}

Synthetic Asset Factory

// contracts/synthetic-asset-factory/src/contract.rs
use soroban_sdk::{contract, contractimpl, Address, Env, String, Bytes};

#[contract]
pub struct SyntheticAssetFactory;

#[contractimpl]
impl SyntheticAssetFactory {
    /// Create a new synthetic asset
    pub fn create_synthetic_asset(
        env: Env,
        creator: Address,
        underlying_asset: Address,
        name: String,
        symbol: String,
        collateral_ratio: u32, // Basis points (15000 = 150%)
        liquidation_ratio: u32 // Basis points (12000 = 120%)
    ) -> Result<Address, SyntheticError> {
        creator.require_auth();

        if collateral_ratio <= liquidation_ratio {
            return Err(SyntheticError::InvalidRatios);
        }

        // Deploy new synthetic asset contract
        let synthetic_wasm = env.storage().instance()
            .get(&DataKey::SyntheticAssetWasm)
            .ok_or(SyntheticError::WasmNotSet)?;

        let salt = Bytes::from_array(&env, &[underlying_asset.clone().into()]);
        let synthetic_address = env.deployer().with_current_contract(salt)
            .deploy(synthetic_wasm);

        // Initialize synthetic asset
        let synthetic_config = SyntheticConfig {
            underlying_asset: underlying_asset.clone(),
            name: name.clone(),
            symbol: symbol.clone(),
            collateral_ratio,
            liquidation_ratio,
            total_supply: 0,
            total_collateral: 0,
        };

        env.storage().persistent().set(&DataKey::SyntheticAsset(synthetic_address.clone()), &synthetic_config);

        emit_synthetic_created(&env, synthetic_address.clone(), underlying_asset, name, symbol);
        Ok(synthetic_address)
    }

    /// Mint synthetic assets by depositing collateral
    pub fn mint_synthetic(
        env: Env,
        user: Address,
        synthetic_asset: Address,
        collateral_amount: i128,
        synthetic_amount: i128
    ) -> Result<(), SyntheticError> {
        user.require_auth();

        let mut config = Self::get_synthetic_config(&env, &synthetic_asset)?;

        // Calculate required collateral
        let oracle_price = Self::get_oracle_price(&env, &config.underlying_asset)?;
        let required_collateral = (synthetic_amount * config.collateral_ratio as i128 * oracle_price) / (10000 * 1e7 as i128);

        if collateral_amount < required_collateral {
            return Err(SyntheticError::InsufficientCollateral);
        }

        // Transfer collateral to contract
        token::Client::new(&env, &config.underlying_asset)
            .transfer(&user, &env.current_contract_address(), &collateral_amount);

        // Mint synthetic asset
        Self::mint_synthetic_token(&env, &synthetic_asset, &user, synthetic_amount)?;

        // Update position
        let mut position = Self::get_user_position(&env, &synthetic_asset, &user).unwrap_or_default();
        position.collateral += collateral_amount;
        position.debt += synthetic_amount;

        env.storage().persistent().set(&DataKey::UserPosition(synthetic_asset.clone(), user.clone()), &position);

        // Update global state
        config.total_supply += synthetic_amount;
        config.total_collateral += collateral_amount;
        env.storage().persistent().set(&DataKey::SyntheticAsset(synthetic_asset.clone()), &config);

        emit_synthetic_minted(&env, user, synthetic_asset, collateral_amount, synthetic_amount);
        Ok(())
    }

    /// Burn synthetic assets and withdraw collateral
    pub fn burn_synthetic(
        env: Env,
        user: Address,
        synthetic_asset: Address,
        synthetic_amount: i128
    ) -> Result<i128, SyntheticError> {
        user.require_auth();

        let mut config = Self::get_synthetic_config(&env, &synthetic_asset)?;
        let mut position = Self::get_user_position(&env, &synthetic_asset, &user)
            .ok_or(SyntheticError::NoPosition)?;

        if position.debt < synthetic_amount {
            return Err(SyntheticError::InsufficientDebt);
        }

        // Calculate collateral to return (proportional)
        let collateral_to_return = (position.collateral * synthetic_amount) / position.debt;

        // Burn synthetic tokens
        Self::burn_synthetic_token(&env, &synthetic_asset, &user, synthetic_amount)?;

        // Transfer collateral back to user
        token::Client::new(&env, &config.underlying_asset)
            .transfer(&env.current_contract_address(), &user, &collateral_to_return);

        // Update position
        position.collateral -= collateral_to_return;
        position.debt -= synthetic_amount;

        if position.debt == 0 {
            env.storage().persistent().remove(&DataKey::UserPosition(synthetic_asset.clone(), user.clone()));
        } else {
            env.storage().persistent().set(&DataKey::UserPosition(synthetic_asset.clone(), user.clone()), &position);
        }

        // Update global state
        config.total_supply -= synthetic_amount;
        config.total_collateral -= collateral_to_return;
        env.storage().persistent().set(&DataKey::SyntheticAsset(synthetic_asset.clone()), &config);

        emit_synthetic_burned(&env, user, synthetic_asset, synthetic_amount, collateral_to_return);
        Ok(collateral_to_return)
    }

    /// Liquidate undercollateralized position
    pub fn liquidate_position(
        env: Env,
        liquidator: Address,
        synthetic_asset: Address,
        user: Address,
        synthetic_amount: i128
    ) -> Result<i128, SyntheticError> {
        liquidator.require_auth();

        let config = Self::get_synthetic_config(&env, &synthetic_asset)?;
        let position = Self::get_user_position(&env, &synthetic_asset, &user)
            .ok_or(SyntheticError::NoPosition)?;

        // Check if position is liquidatable
        let oracle_price = Self::get_oracle_price(&env, &config.underlying_asset)?;
        let collateral_value = (position.collateral * oracle_price) / 1e7 as i128;
        let debt_value = position.debt;
        let collateral_ratio = (collateral_value * 10000) / debt_value;

        if collateral_ratio >= config.liquidation_ratio as i128 {
            return Err(SyntheticError::PositionNotLiquidatable);
        }

        // Calculate liquidation reward (e.g., 5% bonus)
        let collateral_to_seize = (synthetic_amount * oracle_price * 105) / (100 * 1e7 as i128);

        // Transfer synthetic tokens from liquidator
        Self::burn_synthetic_token(&env, &synthetic_asset, &liquidator, synthetic_amount)?;

        // Transfer collateral to liquidator
        token::Client::new(&env, &config.underlying_asset)
            .transfer(&env.current_contract_address(), &liquidator, &collateral_to_seize);

        // Update user position
        let mut updated_position = position;
        updated_position.debt -= synthetic_amount;
        updated_position.collateral -= collateral_to_seize;

        if updated_position.debt == 0 {
            env.storage().persistent().remove(&DataKey::UserPosition(synthetic_asset.clone(), user.clone()));
        } else {
            env.storage().persistent().set(&DataKey::UserPosition(synthetic_asset.clone(), user.clone()), &updated_position);
        }

        emit_position_liquidated(&env, liquidator, user, synthetic_asset, synthetic_amount, collateral_to_seize);
        Ok(collateral_to_seize)
    }
}

#[derive(Clone, Debug)]
pub struct SyntheticConfig {
    pub underlying_asset: Address,
    pub name: String,
    pub symbol: String,
    pub collateral_ratio: u32,
    pub liquidation_ratio: u32,
    pub total_supply: i128,
    pub total_collateral: i128,
}

#[derive(Clone, Debug, Default)]
pub struct UserPosition {
    pub collateral: i128,
    pub debt: i128,
}

Integration with Existing Protocol

Enhanced Pool Contract Integration

// Add to contracts/pool/src/contract.rs
impl Pool {
    /// Supply liquidity and automatically stake in yield farming
    pub fn supply_and_stake(
        env: Env,
        from: Address,
        asset: Address,
        amount: i128,
        stake_in_farming: bool
    ) -> Result<(), PoolError> {
        from.require_auth();

        // Execute normal supply
        Self::supply(env.clone(), from.clone(), asset.clone(), amount)?;

        if stake_in_farming {
            // Get LP token for this asset pool
            let lp_token = Self::get_lp_token(&env, &asset);

            // Stake in liquidity mining
            let mining_contract = Self::get_liquidity_mining_contract(&env);
            let mining_client = LiquidityMiningClient::new(&env, &mining_contract);

            mining_client.stake(&from, &lp_token, &amount);
        }

        Ok(())
    }

    /// Flash loan with AMM arbitrage
    pub fn flash_loan_arbitrage(
        env: Env,
        borrower: Address,
        asset: Address,
        amount: i128,
        amm_pairs: Vec<Address>
    ) -> Result<i128, PoolError> {
        borrower.require_auth();

        let initial_balance = token::Client::new(&env, &asset).balance(&borrower);

        // Execute flash loan
        Self::flash_loan(env.clone(), borrower.clone(), asset.clone(), amount, soroban_sdk::Bytes::new(&env))?;

        // Borrower should execute arbitrage in callback
        // Check profit was made
        let final_balance = token::Client::new(&env, &asset).balance(&borrower);
        let profit = final_balance - initial_balance;

        emit_flash_loan_arbitrage(&env, borrower, asset, amount, profit);
        Ok(profit)
    }
}

Advanced Features

Options Contract (Basic Implementation)

// contracts/options/src/contract.rs
#[contract]
pub struct Options;

#[contractimpl]
impl Options {
    /// Create a new options contract
    pub fn create_option(
        env: Env,
        creator: Address,
        underlying_asset: Address,
        strike_price: i128,
        expiry: u64,
        option_type: OptionType,
        premium: i128
    ) -> Result<u64, OptionsError> {
        creator.require_auth();

        let option_id = Self::get_next_option_id(&env);

        let option = OptionContract {
            id: option_id,
            creator: creator.clone(),
            underlying_asset: underlying_asset.clone(),
            strike_price,
            expiry,
            option_type: option_type.clone(),
            premium,
            exercised: false,
            active: true,
        };

        env.storage().persistent().set(&DataKey::Option(option_id), &option);

        emit_option_created(&env, option_id, creator, underlying_asset, strike_price, expiry, option_type);
        Ok(option_id)
    }

    /// Exercise an option
    pub fn exercise_option(
        env: Env,
        holder: Address,
        option_id: u64
    ) -> Result<(), OptionsError> {
        holder.require_auth();

        let mut option = Self::get_option(&env, option_id)?;

        if option.exercised || !option.active {
            return Err(OptionsError::OptionNotActive);
        }

        if env.ledger().timestamp() > option.expiry {
            return Err(OptionsError::OptionExpired);
        }

        // Get current price from oracle
        let current_price = Self::get_oracle_price(&env, &option.underlying_asset)?;

        // Check if option is in the money
        let in_the_money = match option.option_type {
            OptionType::Call => current_price > option.strike_price,
            OptionType::Put => current_price < option.strike_price,
        };

        if !in_the_money {
            return Err(OptionsError::OptionOutOfMoney);
        }

        // Execute option
        let payout = match option.option_type {
            OptionType::Call => current_price - option.strike_price,
            OptionType::Put => option.strike_price - current_price,
        };

        // Transfer payout to holder
        token::Client::new(&env, &option.underlying_asset)
            .transfer(&env.current_contract_address(), &holder, &payout);

        option.exercised = true;
        env.storage().persistent().set(&DataKey::Option(option_id), &option);

        emit_option_exercised(&env, option_id, holder, payout);
        Ok(())
    }
}

#[derive(Clone, Debug)]
pub enum OptionType {
    Call,
    Put,
}

#[derive(Clone, Debug)]
pub struct OptionContract {
    pub id: u64,
    pub creator: Address,
    pub underlying_asset: Address,
    pub strike_price: i128,
    pub expiry: u64,
    pub option_type: OptionType,
    pub premium: i128,
    pub exercised: bool,
    pub active: bool,
}

Testing Strategy

AMM Tests

#[test]
fn test_amm_swap() {
    let env = TestEnvironment::new();
    let amm = deploy_amm(&env);

    // Add initial liquidity
    add_liquidity(&env, &amm, 1000, 2000);

    // Test swap
    let amount_out = swap_exact_tokens_for_tokens(&env, &amm, 100);
    assert!(amount_out > 0);
}

Yield Farming Tests

#[test]
fn test_liquidity_mining() {
    let env = TestEnvironment::new();
    let mining = deploy_liquidity_mining(&env);

    // Stake LP tokens
    stake_lp_tokens(&env, &mining, 1000);

    // Advance time and claim rewards
    env.advance_time(86400); // 1 day
    let rewards = claim_rewards(&env, &mining);
    assert!(rewards > 0);
}

Performance Optimizations

Gas Optimizations

• Batch operations for multiple swaps
• Efficient sqrt implementation for AMM
• Optimized storage layouts
• Reduced cross-contract calls

User Experience

• One-click liquidity provision + staking
• Automated yield optimization strategies
• Slippage protection mechanisms
• MEV protection features

Dependencies

• Existing TrustBridge contracts (Pool, Oracle, etc.)
• Math libraries for AMM calculations
• Token standards compatibility
• Oracle price feeds

Definition of Done

• AMM working with proper constant product formula
• Liquidity mining program operational
• Synthetic assets creation and management working
• Basic options contracts functional
• Flash loan optimizations implemented
• Integration with existing pool contracts complete
• Comprehensive testing suite passing
• Gas optimizations implemented
• Security audits completed

[emarc99]

Would love to give this a go!

[emarc99]

PR in a few..