LGE Hookathon Entry HK-UHI6-0442 - UHI6

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This repository contains smart contracts for the LGE (Liquidity Generation Event) - a novel liquidity-first mechanism for launching new tokens on Uniswap v4. Creators bootstrap liquidity with a dutch auction. Only if 100% liquidity is achieved is the LGE a success, otherwise participants claim their ETH back loosing nothing.

LGE Flow

Architecture

Core Components

1. LGEManager.sol - Factory Contract. The main entry point for deploying new LGE campaigns. Key Features:
   • Deploys an ERC20 token;
   • Deploys a hook along with the token;
2. LGEToken.sol - ERC20 Token. A capped ERC20 token with administrative functions. Key Features:
   • Fixed total supply - 17,745,440,000 tokens, 18 decimals;
   • Burnable tokens;
   • Capped total supply;
   • Admin-controlled metadata and image updates;
   • Minting restricted to the LGE hook only;
3. LGEHook.sol - Uniswap v4 Hook. The core LGE mechanism that handles deposits, liquidity provision, and pool creation. Key Features:
   • LGE duration: 5,000 blocks;
   • deposit() function: users deposit ETH to purchase tokens at the calculated price;
   • withdraw() function: retrieve ETH if LGE fails;
   • claimLiquidity() function: claim LP position after successful LGE;
4. LGECalculationsLibrary.sol - Price Calculations. Helper library for price and liquidity calculations. Key Features:
   • Calculates token price based on min/max values, current block, and a start block;
   • Calculates sqrt for the pool initialisation;

LGE Mechanism

Phase 1: Token Sale (Blocks 0-5,000)

1. Dynamic Pricing: Token price decreases linearly from maxTokenPrice to minTokenPrice over the stream period
2. Deposit Structure: Users deposit ETH where:
   • 50% goes toward liquidity provision
   • 50% remains for rewards and tokenomics
3. Fair Distribution: Dutch auction prevents sniping, ensures early buyers don't have unfair advantage and allows price discover.

Phase 2: LGE Conclusion (Block 5,000)

Success Criteria: All tokens (cap amount) must be sold.

If successful:

• Uniswap v4 pool is automatically created
• Initial liquidity is added (50% of ETH + all tokens)
• Pool parameters (may change for MVP based on feedback and more testing):
  • Fee: 1% (10,000 basis points)
  • Tick spacing: 1
  • Full range liquidity (MIN_TICK to MAX_TICK)

If failed:

• Users can withdraw their deposited ETH

Open Issues

The current open issue is the precision loss that happens during minting a position. It uses exact half of the ETH needed to mint a liquidity, however it also uses smaller amount of tokens. Ideally, what we want to achieve is using exact amount of ETH + exact amount of tokens to create a liquidity position. We're currently investigating the best way to achieve this with minimal precision loss.

Test Coverage

Current test coverage is ~80%. The main tests are located in the test directory, LGEHook.t.sol. The tests cover various scenarios, including successful and failed LGEs.

Contract Deployments

Ethereum Sepolia Testnet (not verified)

Contract Name	Contract Address
LGEManager	0x80b151Bd4Ed017692F395E2F0395f0c84071A56B
LGECalculationsLibrary	0x74C6B2321BeD36FB92E9c88fc33D2A77ED7bBe57

License

MIT