General

1. What is Shield?

Shield is building a one-of-a-kind decentralized protocol for future derivatives infrastructure, enabling global borderless access to finance. Shield strives to expand on the success of DeFi in the derivatives market. It’s a new era for on-chain derivatives traders.

2. Why choose Shield?

At V1.0, Shield introduces the first perpetual option, an innovative derivatives instrument that pioneers the first long-term on-chain options without the effort, risk, or expense of rolling positions. Shield perpetual options product creates unique and tremendous value in solving options traders' concerns and solved rolling positions and the benefit of not being liquidated. It can be utilized as a unique and optimal trading instrument across a wide range of market trends. These values naturally spread among users who demand them and fall in love with Shield after using it.

3. How Shield’s solution is unique?

Precise pricing for perpetual options on-chain - Applying mathematical knowledge of stochastic processes, volatility, and partial differential equations with initial margins, Shield finds the exact solution of Shield perpetual option funding fees. Meanwhile, Shield applied the nonlinear cutting process and succeeded in implementing the pricing on-chain by replacing the exact solution of the nonlinear pricing model with a linear computation to find an approximate solution.
Dual liquidity pools - The dual liquidity pool allows the private pool to hedge the market making risk, while the low-risk public pool can accommodate huge liquidity to guarantee abundant liquidity on the market
On-chain random matching engine - Shield pioneered the first on-chain random order-taking algorithm. Newly opened orders are randomly generated by two random factors: the hash of the block and the block time, and the remainder is taken using the current private pool length, i.e., the order is assigned to the corresponding private pool first. If the private pool is critical or the available balance is insufficient, it is polled sequentially until an available private pool is encountered.
Liquidator and decentralized Brokerage system designed based on game theory - Liquidator compete to receive 150% of the gas expense as arbitrage rewards while decentralized brokerage system incentivize brokers to bring a steady stream of traders to the Shield network through education and referrals

4. How does Shield work?

Shield is building a secure, stable, and open decentralized derivatives trading protocol. Based on a fully non-cooperative game network. Shield's decentralized network is maintained by four roles; broker, private pool LP, public pool LP, and liquidators. Including scheduling of value, which is performed through the SLD governance token.
Each role has a clear interest incentive and sufficient competition mechanism, each person for their own interests to implement the network needs, but to achieve the optimal network-wide Nash equilibrium to maintain the security and stability of the network.

5. What is the non-cooperative game?

In 1950, John Forbes Nash proposed the idea; non-cooperative games describe a multi-player game system that is not limited to two people (i.e., a zero-sum game) and that is stable after a Nash equilibrium is achieved. Before the birth of blockchain, the majority of the governance systems included; banks, exchanges, internet majors, and social institutions. These were based on zero-sum games. The zero-sum game systems pinned their hopes on leaving organizational functions; by providing order to combat entropy growth to a few centralized strongmen. As known to all, a governance system based on zero-sum games is an unstable structure that moves to the left or the right as the power of the parties changes. The structure that determines the convergence of power to the strongest side of the game from day one leading to the collapse and reconstruction of order repeatedly. The only way to achieve long-term stability is to have the optimal structure of the entire network as if the tent is held up by the footpegs, which is the fundamental mathematical basis for the blockchain to reshape the world order.

6. What is the SLD token used for?

SLD token is a utility token designed to facilitate and incentivize Shield DAO and value allocation. Shield captures value through trading fees and returns 100% of the revenue to the maintainers of the decentralized network (value creators).
GOVERNANCE — Shield is the community itself and will transit to community governance to decide the product roadmap, ecosystem support, and reshape the future derivatives protocol.
SWAP&BURN — The value of the SLDs mined is redeemed by Swap&Burn contracts. Shield generates a buyback price by making 10% of the total SLDs outstanding always equal to 100% of the repurchase pool value (derived from 90% of the transaction fees). Shield token holders can utilize Swap&Burn to earn profits.

7. What price feeds does Shield integrate?

Shield integrates Chainlink, Uniswap, and Sushiswap as price feeds. The opening price is the index price. Contracts directly interacted with dual-liquidity pools, thus replacing the complex matching calculation on-chain.

8. What is Shield’s business model?

Shield captures value through trading fees and returns 100% of the revenue to the maintainers of the decentralized network (value creators) through the innovative Swap&Burn mechanism.

9. What is the Funding Fee on Shield?

Funding fee is the cost borne by the users to keep positions open for the funding interval. The fee will be prepaid for opening a position, and accumulated through funding intervals. Please refer to the Pricing Method for additional details.

10. Is there any risk?

No platform can be considered to be completely risk-free. The risk associated with the Shield protocol is smart contract risk. We have taken every possible step to minimize the risk - the protocol code is public, open, and audited more than once. In addition, there is an ongoing bug bounty program to incentivize users to find bugs as a way to make the platform more secure.

11. What is Shield's roadmap?

12. What is the SLD vesting schedule?

Last modified 2mo ago