Super DCA Gauge

A system for developers looking to do a fair distribution of an inflationary token that is split 50/50 between the community (i.e., Uniswap V4 Liquidity Providers) and the developers.

Part of the Super DCA Framework
🌐 Token  |  📊 Gauge  |  🏊 Pool

Super DCA Gauge Distribution System Specifications

The SuperDCAGauge contract is a specialized Uniswap V4 pool hook designed to implement a staking and reward distribution system for SuperDCAToken tokens. It integrates with Uniswap V4 pools to distribute rewards during liquidity events. The primary functions of the SuperDCAGauge are:

• Before Initialize: When a pool using the SuperDCAGauge hook is created, the hook:

  1. Reverts if the pool is not using the SuperDCAToken token or has a fee tier other than 0.05%

• Before Liquidity Addition: When liquidity is added to the pool, the hook:

  1. Updates the global reward index based on elapsed time and mint rate
  2. Calculates rewards for the pool based on staked amounts
  3. If rewards are available:
     • Splits rewards 50/50 between the pool (community) and developer
     • Donates the community share to the pool
     • Transfers the developer share to the developer address

• Before Liquidity Removal: The same distribution process occurs before liquidity is removed, following identical steps as the liquidity addition hook.

Key features:

• Only processes rewards for pools that include SuperDCAToken and have the correct fee (0.05%)
• Users can stake SuperDCATokens for specific token pools to participate in rewards
• Rewards for each pool are calculated based on staked amounts per pool, the total staked amount, the mint rate, and time elapsed

Distribution

stateDiagram-v2
    direction LR

    state "Liquidity Provider" as LP_ETH
    state "ETH‑DCA Pool" as Pool_ETH
    state "SuperDCAGauge (ETH‑DCA)" as Hook_ETH
    state "SuperDCAToken" as Token
    state "Developer" as Developer
    

    %% ETH‑DCA Pool Flow
    LP_ETH --> Pool_ETH: 1.mint/burn()
    Pool_ETH --> Hook_ETH: 2.beforeAdd/RemoveLiquidity()
    Hook_ETH --> Token: 3.mint()
    Token --> Hook_ETH: 4.transfer()
    Hook_ETH --> Pool_ETH: 5.donate()
    Hook_ETH --> Developer: 6.transfer()

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1. The Liquidity Provider adds/removes liquidity to the ETH‑DCA Pool
2. The ETH‑DCA Pool calls the SuperDCAGauge hook's beforeModifyLiquidity function
3. The SuperDCAGauge calculates rewards based on elapsed time and staked amounts
4. The SuperDCAToken mints new tokens to the SuperDCAGauge based on the mint rate

The SuperDCAGauge splits rewards 50/50 between:

5. Pool (community share): Donated via Uniswap v4's donate function
6. Developer: Transferred directly to developer address

Staking

The SuperDCAGauge contract implements a gauge-style staking and reward distribution system for Uniswap V4 pools. When users add or remove liquidity from eligible pools (e.g., 0.05% fee tier pools containing DCA token), rewards are distributed to the members of the pool using Uniswap v4 donate functionality.

DCA token holders stake their tokens in the SuperDCAGauge contract for a specific token pool (e.g., USDC, WETH). The magnitude of the stake amount relative to the total staked amount for all tokens determines the reward amount for each token's pool (e.g., USDC-DCA, WETH-DCA). The reward amount for each pool is calculated based on tracking an index that increases over time according to the mint rate. The following are the key formulas for the reward calculation:

# Minted Tokens
mintedTokens = mintRate * timeElapsed

# Reward Index
rewardIndex += mintedTokens / totalStaked

# Reward per token
reward = token.stakedAmount * (currentRewardIndex - token.lastRewardIndex)

where the reward index increases over time according to the mint rate. All rewards are split 50/50 between the pool (community) and developer. The rewardIndex in the contract closely mirrors the incomeIndex-method used by Aave for interest accrual.

Example

In this example, we show how the rewardIndex is updated to accrue rewards for all pools. Consider two pools with 1000 total DCA staked:

USDC-DCA pool: 600 DCA staked (60%)
WETH-DCA pool: 400 DCA staked (40%)
Total Staked = 1000 DCA

Consider the emission rate of 100 DCA/s (in wei). After 20 seconds, 2000 DCA rewards are generated. Which means that the community share is 1000 DCA.

Current Reward Index = 0 
Reward Amount    = 1000 DCA
Total Staked     = 1000 DCA
Reward per Token = Reward / Total Staked
                 = 1000 DCA / 1000 DCA
                 = 1 DCA
Next Reward Index += Rewards per Token
                  = 0 + 1 DCA
                  = 1 DCA

This indicates all pools have been credited with 1 units of reward per token staked to the token's pool. And the math for recovering the current amount of rewards for each pool is as follows:

Pool Reward = stakedAmount * (currentIndex - lastClaimIndex)
USDC-DCA Reward = 600 DCA * (1 - 0) = 600 DCA
WETH-DCA Reward = 400 DCA * (1 - 0) = 400 DCA

When a pool triggers a reward distribution, the rewardIndex is updated to the current index and that pool's share of the rewards is minted and distributed to the pool and the developer. The other pools that did not trigger a reward distribution are not affected.

Dynamic Fees

The SuperDCAGauge implements a dynamic fee system using Uniswap V4's dynamic fee capability, allowing for differentiated swap fees based on the trader's classification. This feature enables preferential fee treatment for internal ecosystem participants while maintaining standard fees for external users.

Fee Structure

• Internal Fee: 0% (0 basis points) - Applied to addresses marked as "internal"
• External Fee: 0.10% (1000 basis points) - Applied to all other addresses
• Dynamic Application: Fees are determined at swap time based on the swapper's internal address status

Technical Implementation

The dynamic fee system operates through the _beforeSwap hook:

1. Address Classification: The system identifies the actual swapper using IMsgSender(sender).msgSender() to handle cases where swaps are routed through intermediary contracts
2. Fee Selection: Based on the swapper's internal address status (isInternalAddress[swapper]), either the internal or external fee is applied
3. Dynamic Override: The selected fee is returned with the LPFeeLibrary.OVERRIDE_FEE_FLAG to dynamically set the pool's fee for that specific swap

Management Functions

The fee system includes several management capabilities restricted to the MANAGER_ROLE:

• setFee(bool _isInternal, uint24 _newFee): Updates either internal or external fee rates
• setInternalAddress(address _user, bool _isInternal): Marks or unmarks addresses as internal for preferential fee treatment

Deployment Addresses

Network	Contract	Address
All	Super DCA Token	0xb1599cde32181f48f89683d3c5db5c5d2c7c93cc
Base	SuperDCAGauge	0xBc5F29A583a8d3ec76e03372659e01a22feE3A80
Optimism	SuperDCAGauge	0xb4f4Ad63BCc0102B10e6227236e569Dce0d97A80
Base Sepolia	SuperDCAGauge	0x741810C3Fb97194dEcB045E45b9920680E1d7a80
Unichain Sepolia	SuperDCAGauge	0xEC67C9D1145aBb0FBBc791B657125718381DBa80