Stellar Futarchy

Permissionless futarchy governance on Stellar/Soroban. Proposals are decided by prediction markets instead of token-weighted voting — vote on values, bet on beliefs.

Inspired by MetaDAO on Solana.

How It Works

1. Register a DAO — Anyone can create a futarchy DAO with a governance token and parameters (proposal duration, pass threshold, AMM fee)
2. Create a Proposal — Proposer deposits base tokens as initial liquidity. Tokens get split into conditional pass and fail tokens, seeded into an AMM pool
3. Market Voting — Traders buy/sell pass vs fail tokens on the AMM. If you think a proposal will benefit the DAO, buy pass tokens. The market price reflects collective belief
4. Resolution — After the voting period, the TWAP (time-weighted average price) determines the outcome. If pass price > threshold, the proposal passes. Winners redeem conditional tokens 1:1 for the underlying

Architecture

Smart Contracts (Soroban/Rust)

Contract	Description
factory	On-chain registry — deploys and lists all DAOs. Single entry point, no DB needed
dao	Individual DAO — proposal lifecycle, deploys vault+AMM per proposal, finalizes via TWAP
conditional_vault	Splits tokens into pass/fail conditionals. Merge, transfer, and redeem after resolution
futarchy_amm	Constant product AMM (x·y=k) with TWAP oracle for pass/fail token trading

Frontend (Next.js + TypeScript + Tailwind)

Route	Description
/	List all registered DAOs
/register	Permissionless DAO registration form
/dao/[id]	DAO detail — view proposals, create proposals, trade, finalize

Wallet integration via Freighter.

Trading Guide

Once a proposal is active, the Trade panel has three actions:

Split

Deposit base tokens (e.g. XLM) into the vault. You receive an equal amount of pass and fail conditional tokens. This is the entry point — you must split before you can trade.

Example: Split 100 base tokens → get 100 pass + 100 fail tokens

Swap

Trade conditional tokens on the AMM. If you believe the proposal will pass, sell your fail tokens to buy more pass tokens (and vice versa). The swap uses a constant product formula (x*y=k) with a small fee.

• Buy Pass (sell fail): You think the proposal will succeed
• Buy Fail (sell pass): You think the proposal will fail
• Use at least ~10 tokens per swap to avoid rounding to zero against large reserves
• 5% slippage tolerance is applied automatically

Merge

Burn equal amounts of pass + fail tokens to get back your base tokens. This is the reverse of split — useful if you want to exit your position without waiting for resolution.

Example: Merge 50 tokens → burn 50 pass + 50 fail → receive 50 base tokens back

After the proposal is finalized, a Redeem button appears instead. Winners redeem their conditional tokens 1:1 for base tokens (pass tokens if proposal passed, fail tokens if it failed).

Prerequisites

• Rust with wasm32-unknown-unknown target
• Stellar CLI (cargo install --locked stellar-cli)
• Bun for frontend
• Freighter wallet browser extension (set to testnet)

Quick Start

Build Contracts

# Add WASM target if needed
rustup target add wasm32-unknown-unknown

# Build in order (each depends on previous WASMs)
cargo build --release --target wasm32-unknown-unknown -p conditional-vault
cargo build --release --target wasm32-unknown-unknown -p futarchy-amm
cargo build --release --target wasm32-unknown-unknown -p dao
cargo build --release --target wasm32-unknown-unknown -p factory

Deploy to Testnet

# Generate a testnet keypair and fund it
stellar keys generate default --network testnet --fund

# Deploy all contracts
./scripts/deploy.sh

The script outputs contract IDs and WASM hashes. Copy them to frontend/.env.local:

NEXT_PUBLIC_FACTORY_CONTRACT_ID=C...
NEXT_PUBLIC_VAULT_WASM_HASH=...
NEXT_PUBLIC_AMM_WASM_HASH=...

Run Frontend

cd frontend
bun install
bun dev

Open http://localhost:3000.

Run Tests

cargo test -p conditional-vault

Project Structure

stellarFutarchy/
├── Cargo.toml                    # Rust workspace
├── contracts/
│   ├── factory/                  # On-chain DAO registry + deployer
│   ├── dao/                      # Individual DAO + proposal orchestrator
│   ├── conditional_vault/        # Conditional token vault
│   └── futarchy_amm/             # AMM with TWAP oracle
├── frontend/
│   ├── src/
│   │   ├── app/                  # Next.js pages
│   │   ├── components/           # React components
│   │   └── lib/                  # Stellar SDK helpers, contract calls
│   └── .env.local                # Contract IDs (after deploy)
└── scripts/
    └── deploy.sh                 # Build + deploy to testnet

Testnet

All contracts are deployed on Stellar testnet. See frontend/.env.local for current contract IDs.

License

MIT