/CDP-with-API3-airnode

CDP with the API3 airnode

Primary LanguageJavaScriptMIT LicenseMIT

CDP with the API3 airnode

Introduction of the CDP with the API3 airnode

  • This is the smart contract that the structure of CDP ( Collateralized Debt Positionn ) with API3 is implemented.
    • In this CDP structure, 4 steps below is executed:
      • ① A user lend (deposit) DAI as a collateral into the Pool (the CDP contract).
      • ② A user borrow WBTC based on the Bitcoin price (USD per BTC)
        • At this time, API3 airnode works as oracle for retriving the price feed of Bitcoin (BTC) price.
        • Based on the Bitcoin price (USD per BTC), borrowing limit is determined.
      • ③ A user repay WBTC borrowed + Interest.
      • ④ A user withdraw DAI lended (deposited).

Diagram (Workflow)

  • Diagram that this workflow is written.
    diagram_CDP-with-API3-airnode

A starter project for deploying an Airnode and making requests to it

This project is composed of two steps:

  1. Deploy an Airnode on a supported chain
  2. Make a request to the deployed Airnode in a contract

Currently supported chains:

  • Ropsten
  • Rinkeby
  • Goerli
  • Kovan
  • xDai
  • Fantom

You can skip the first step and use the Airnode that we have deployed on Ropsten as well. You are recommended to read the contents of the scripts as you run them, and read the entire readme before starting.

Setup

First, you need to create a wallet and fund it.

  1. Clone this repo
  2. Run the following to install the dependencies
npm install
  1. Run the following to build the contracts
npm run build
  1. Run the following to generate a wallet, whose mnemonic phrase will be displayed on the terminal and recorded in a .env file at the project root.
npm run generate-wallet
  1. Install Metamask to your web browser
  2. Import the mnemonic phrase to Metamask
  3. Use the faucet to get some Ropsten ETH, or use any other appropriate source for the chain you will be working on

Then, you need to get a provider URL. This will be used both by the deployed Airnode and by you while interacting with contracts. If you will be working on Ropsten:

  1. Go to Infura, create an account and get a Ropsten provider URL
  2. Replace https://ropsten.infura.io/v3/{YOUR_KEY} in your .env file with the URL you got from Infura

Adapt the steps above if you will be using another chain. Note that you can use any other provider or your own node. However, if you will be deploying your own Airnode, the provider endpoint must be publicly accessible (i.e., 127.0.0.1:8545 will not work).

(You only need cloud credentials if you will not be skipping Step 1.)

Follow the docs to create your cloud credentials. Place them at /config/.env, similar to /config/example.env. Do not confuse this .env file with the one in the project root that keeps your mnemonic phrase and provider URL.

Following these instructions to deploy an Airnode on AWS is free at the time this is being written.

Step 1: Deploy an Airnode

Normally, you would need to do two things before you deploy an Airnode:

  1. Specify the API integration
  2. Configure your Airnode

For this project, we specified a minimal integration to the popular and free CoinGecko API, and prepared the configuration files. We only integrated a single API operation, GET for /coins/{id}, which you can see below. The localization, tickers, community_data, developer_data and sparkline parameters are fixed as "false", while market_data is fixed as "true". The id parameter will be provided by the requester (e.g., "ethereum") under the name coinId. You can make test calls over the CoinGecko API docs to see the response format.

See config.example.json for how this integration is achieved. We fixed the reserved parameters to read the value from market_data.current_price.usd, cast it as an int256 and multiply it by 1,000,000 before returning. No security scheme (i.e., API key) is defined in config.json or security.json because the CoinGecko API is publicly accessible.

Customize your config.json

Run the following to insert the contents of .env to config/config.example.json and save it as config/config.json

npm run customize-config

Deploy

Now your /config directory should have the required config.json, security.json and .env files. Run the following to deploy your node:

cd config
# The deployer has to be run in the directory where the configuration files are
docker run -it --rm \
  --env-file .env \
  --env COMMAND=deploy-first-time \
  -v $(pwd):/airnode/out \
  api3/airnode-deployer:pre-alpha

This will output a receipt file with the extension .receipt.json.

Fund your master wallet

Run the following to send your master wallet 0.1 ETH for it to create a provider record for you on-chain.

npm run fund-master-wallet

Your deployed Airnode will use these funds to make the transaction that will create the provider record on the chain you are operating on, and send the leftover ETH back to your address automatically. You will have to wait ~1 minute for this to happen, otherwise the next step will fail.

Make your endpoint publicly accessible

config.json defines an endpoint named coinMarketData, whose endpoint ID is 0xf466b8feec41e9e50815e0c9dca4db1ff959637e564bb13fefa99e9f9f90453c. Endpoints are not publicly accessible by default, so you will have to make a transaction for this. Run the following to set your endpoint's authorizers to [0x0000000000000000000000000000000000000000], which makes it publicly accessible:

npm run update-authorizers

Step 2: Make a request

The scripts in this step will use the Airnode you have deployed if you have completed Step 1. Otherwise, it will use the providerId of the Airnode that we have deployed given in parameters.js. Note that the endpointId will be the same either way because it is derived from the OIS and endpoint name.

Create a requester

Run the following to create an on-chain requester record:

npm run create-requester

You can use this requester denoted with an index in other projects as well. Note that requesterIndex is chain-specific, so you will have to create another requester record on other chains.

Deploy the client contract

Run the following to deploy ExampleClient.sol:

npm run deploy-client

Endorse the client

Run the following to endorse your deployed client contract using the requester you have created:

npm run endorse-client

Derive and fund the designated wallet

First run the following to derive the designated wallet for the provider–requester pair:

npm run derive-designated-wallet-address

and then fund this designated wallet with 0.1 ETH:

npm run fund-designated-wallet

The requests that the client contract will make will be funded by this 0.1 ETH. Note that you may have to run fund-designated-wallet again if you make too many requests and use up this 0.1 ETH (very unlikely).

Make a request

Run the following to make a request:

npm run make-request

which should be fulfilled by the Airnode and printed out on the terminal. Note that now that the price is on-chain, you can use it in your contract to implement any arbitrary logic.

Try replacing the coinId value in make-request.js from "ethereum" to "bitcoin" and make another request. You can see the API docs to find out which coin IDs are supported.


Compile

  • Compile by using hardhat
npm run build

(npx hardhat compile)

Script which sbow the demo

  • Execute a script of CDP.sol on Ropsten testnet (via Infura)
npm run script:CDP

References