Arcadia Protocol (Part 1/3) — The Registry

A few days ago we made a big statement: Arcadia is to overcollateralized protocols what Uniswap V4 is to DEXs.

Today, we’re going to explain why. Below we break down the first key component of the Arcadia Protocol. In subsequent posts we will introduce the other core components.

The Registry

The Arcadia Registry is a foundational element of Arcadia V2, positioned as the most basic layer within the Arcadia Finance Technology Stack. Its primary purpose is to serve as a non-opinionated, on-chain infrastructure that implements core pricing and risk management logic essential for the protocol’s operation.

Here are the key aspects and benefits of the Arcadia Registry:

1. Modular Architecture: Unlike monolithic smart contracts that bundle all logic into a single, large contract, the Arcadia Registry employs a modular design. This consists of a main coordinating smart contract, referred to as “The Registry,” and multiple append-only modules. Each module is a separate smart contract responsible for the pricing logic of specific oracle implementations or asset types. This modular approach offers several advantages:

• Reusability: Modules can be reused by different creditors, avoiding the redundancy of creating new, monolithic pricing contracts for each creditor. This not only conserves development resources but also ensures that the pricing and risk management logic is battle-tested and reliable.
• Composability: Different modules can call each other recursively, allowing for pricing and risk logic that is as composable as the tokenized assets themselves. This flexibility enables the system to adapt to a wide range of assets and scenarios.

1. Append-Only Pricing Modules: The Registry facilitates the addition of new asset types that can be priced and, consequently, used as collateral in an Arcadia Account. Importantly, it prohibits the modification of pricing for existing assets, ensuring that users are not disadvantaged by sudden changes in how assets are priced.
2. Comprehensive Portfolio Pricing: Unlike traditional DeFi protocols where isolated positions cannot interact or be collectively assessed, the Arcadia Registry enables users to deposit multiple different assets into their Arcadia Account. The Registry then prices the entire account in a single unit (e.g., USD), simplifying the management and evaluation of a user’s portfolio while providing users with the benefits of cross-margin.
3. Creditor-Specific Risk Parameters: Creditors in Arcadia — smart contracts that accept the value within Arcadia Accounts as collateral — can set specific risk parameters within the Registry. This feature allows creditors to tailor the system to their risk management needs while benefiting from the Registry’s core logic for collateral management and margin calculations.
4. Efficiency and Security: By aggregating core pricing and risk management logic in the Arcadia Registry, the system avoids duplicating effort and potentially introducing bugs through redundant implementations. This not only saves development time but also enhances the overall security and reliability of protocols.

Compared to other protocols, the Arcadia Registry’s modular design, append-only pricing modules, comprehensive account pricing, creditor-specific risk parameters, and focus on efficiency and security represent significant advancements. These features collectively enable more robust, flexible, and user-friendly decentralized financial systems, addressing some of the key challenges faced by earlier DeFi projects that we believe have been holding the sector back.

In short, the Arcadia Registry provides a foundation that enhances efficiency, security, and flexibility for both other protocols and end-users. For protocols, it offers a scalable and reliable infrastructure for developing financial contracts. For end-users, it delivers a more integrated, stable, and user-friendly DeFi experience, empowering them to manage and optimize their digital assets effectively.

You can read more details in our whitepaper: https://github.com/arcadia-finance/whitepapers/blob/main/main.pdf

In subsequent posts we will introduce other key components of the Arcadia Protocol.

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