Dobby.fund

Everybody in Crypto talks about onboarding the next billions of users.

Dobby.fund takes a step into this direction by targeting an untapped demographic:

Non-Crytpo-native parents of newborn children.

Dobby.fund attracts parents through an easy User Experience that enables them to open a Crypto Savings account with their credit card in a few clicks. Without crypto knowledge, they are automatically holding Crypto’s best asset for stable long-term wealth preservation: sDai.

Why Dobby chooses sDai? I

It’s a unique stablecoin with a yield that adjusts based on changing market conditions: in times of high-interest rates (like right now) it adds a solid yield based on its US-Treasury bills (RWA) backing. In times of low-interest rates, it benefits its user from an even higher yield based on its Ethereum backing. These qualities make it the ideal choice for long term (with encountering different economic periods) wealth preservation in a children's savings account. Besides that, sDAI is not rebasing, which provides tax advantages in certain countries and makes it easier to use riskier DeFI products on top of sDAI in the future.

Is that enough to convince non-crypto parents to dodge their traditional child savings account and join Dobby?

We think No, so we went further: Just like Dobby, the house-elf in Harry Potter, the product strives to be a selfless and reliable choice for parents. Besides precautions for the child’s financial future, Dobby offers multiple gamified features, that all align with the parent’s goal of improving their child's future:

1. Locking Funds are locked for an extended period, safeguarding against impulsive financial decisions during the child's youth. This feature inculcates the virtue of patience and foresight.

2. Horcrux: Staying with the Harry Potter analogies, Dobby, at account creation, generates shared secrets that can be printed out and be distributed among family members and close friends. This method encourages the child to maintain healthy family relationships to eventually reconstruct the key and access the funds. This approach not only strengthens family ties but also reduces the risk of losing access credentials like passwords or seed phrases for the custodians of the secrets. It’s like a paper-based multi-sig that does not require the family members to know anything about Crypto.

3. Donations: In case the child cannot retrieve the accumulated funds (e.g. due to losing family relationships), a UNICEF Climate Change wallet is able to retrieve the funds and use them for the world’s future.

Besides magic sDAI yield and a few gamified features, Dobby takes care of the necessary housekeeping to ensure we onboard new users to Crypto in The Right Way.

1. Taking care of gas: Gas is automatically calculated and purchased in the background, so the user doesn’t need to learn about it and has a smooth UX.

2. Noncustodial and low Vendor-Lockin: Despite good UX, after the funds are locked, the savings account is independent of Dobby or the on-ramping provider. Currently, only sDai is having some sort of lock-in. In the future we would use an oracle to redshift funds automatically, in case there are issues with sDAI during the locking period.

3. Paper as a preservation design choice: The horcruxes given to family members, are like a paper-based multi-sig that does not require the family members to know anything about Crypto.

Lastly, Dobby facilitates the onboarding of new users into Crypto through a fusion of two cultures: Our target demographic grew up with the culture of Harry Potter, that’s why we use a few analogies to explain the product. The future shall be Crypto culture, that’s why we introduce them to this new culture through nouns.

Things we want to do next:

1. Deploy to mainnet
2. Build a way to automatically exit sDAI in case of black swan like events
3. Offer riskier accounts through yield farming with sDAI
4. Notify UNICEF when they can claim donations

• We purposely avoided using any wallet providers to streamline the onboarding experience. We generate the account seed phrase and private key by using the Web Crypto API (via ethers.js)
• We used "Shamir's Secret Sharing" algorithm (also implemented on top of Web Crypto API) to “split” the private key into multiple parts directly in the browser and therefore enabling the previously described Horcrux functionality
• We then generated separate PDFs, also in-browser, ensuring that the keys never touch a backend
• To enable credit card payments, we integrated Unlimit payment provider using their SDK. With this approach we still leave a possibility to transfer Crypto from another existing wallet in case someone does not require on-ramping, but likes the rest of the product
• To provide time-locking of the funds, we wrote a solidity contract that can receive ETH and exchange it for other yield-bearing ERC-4626 assets (such as sDAI) using more gas-predictable UniswapV2 pools and direct depositing
• The contract was integration tested using hardhat forks, deployed and validated
• Hacky thing: For the auto donations feature, we would rather not deal with future gas calculations, so we just preauthorized the respective UNICEF wallet to pick up the donations once they are unlocked for them.
• The frontend uses Nouns to visualize the product features and make the product look friendlier