Pike Market Protocol

Pike Market is a decentralized lending and borrowing protocol built for EVMs, designed to provide a secure, scalable, and flexible environment for users to manage their digital assets. It allows users to supply assets to earn yield or borrow against collateralized assets through the pToken contracts.

Overview

In Pike Market, users can:

• Supply ERC-20 tokens to the protocol to receive pTokens (interest bearing tokens).
• Borrow assets by using pTokens as collateral.
• Repay loans or redeem their supplied assets at any time, with interest rates dynamically set based on market demand and utilization rate.
• Liquidate undercollateralized positions by repaying part of a borrower’s debt in exchange for a portion of their collateral with incentives.

The protocol is built using modular, upgradeable components following the router proxy pattern (static diamond proxy) and is based on a fork of Compound v2. This design ensuring the system can adapt and scale with evolving protocol requirements.

Contracts

Pike Market uses several core contracts to facilitate lending and borrowing:

pToken (pERC20)

The pToken module for managing supplied and borrowed assets. Each pToken (e.g., pUSDC, pWETH) represents a user’s stake in a lending market, and users interact with these contracts to supply and withdraw assets, or borrow and repay loans.

• Mint: Supply an asset to the protocol and receive pTokens in return.
• Redeem: Exchange pTokens back for the underlying asset.
• Borrow: Borrow assets against your supplied collateral.
• Repay: Repay borrowed assets to reclaim your collateral.

InterestRateModel (DoubleJumpRate)

The DoubleJumpRate model is a dynamic interest rate system that adjusts borrowing costs based on the utilization rate of the market. It operates with two “kinks” or inflection points, and three distinct ranges of utilization:

• Encourage Range: In the initial low-utilization phase (e.g., up to 5%), the borrowing interest rate, incentivizing liquidity supply without immediate borrowing costs.
• Normal Range: Between the first and second kink (e.g., 5% to 95% utilization), the interest rate increases steadily as utilization rises. This gradual rate adjustment ensures a balanced cost of borrowing, responding to market demand without causing sudden price spikes.
• Discourage Range: Once the second kink is passed (e.g., beyond 95% utilization), the interest rate jumps sharply, discouraging further borrowing. This sharp increase helps protect the protocol from excessive borrowing and keeps liquidity available for withdrawals.

This flexible model allows the protocol to efficiently balance the demand for loans with the need to ensure sufficient liquidity, optimizing for both borrower and supplier incentives across different utilization ranges.

RiskEngine

Responsible for risk management, analogous to the Comptroller, validates permissible user actions and prevents those that fail to meet specific risk parameters. It safeguards the system against undercollateralization by ensuring that each borrower maintains a sufficient collateral balance across all pTokens,.

OracleEngine

The OracleEngine aggregates real-time asset price data from various sources using OracleProviders. Accurate price feeds are essential for determining borrowing limits and triggering liquidations when necessary.

OracleProvider

The OracleProvider is responsible for retrieving price data from specific external sources. Each provider implements its own logic for fetching and managing this data, which is then supplied to the OracleEngine to ensure accurate pricing across the platform.

Security and Audit Information

For detailed security assumptions and contracts scope, please refer to the Audit Scope.

Installation

To run the Pike Market, clone the repository and install the necessary dependencies. Ensure you have yarn or npm installed.

$ git clone https://github.com/nutsfinance/pike-local-markets.git
$ cd pike-local-markets
$ yarn install --lock-file # or `npm install`

Build

yarn build

Testing

Pike Market uses Foundry v1 for testing.

• Version: forge 1.0.0-v1.0.0 (8692e92619 2025-02-10T09:05:59.911807000Z)
• Important: Previous versions of Foundry (e.g., v0.3.0) are not compatible with the current unit tests and may fail to execute them. Ensure you are using latest version for all test operations.

yarn test

Code Coverage

yarn test:coverage

Running Linters

yarn lint:check

Deployment

For deployments we utilize Cannon, a DevOps tool for protocols on EVMs. Cannon simplifies the deployment and upgrade processes, making it easier to manage our contracts.

• Build on base sepolia

yarn deploy:testnet # or dryrun before `yarn deploy:testnet:dryrun`

Scope

Contracts
│   ├── pike-market
│   │   ├── errors
│   │   │   ├── CommonError.sol
│   │   │   ├── IRMError.sol
│   │   │   ├── PTokenError.sol
│   │   │   └── RiskEngineError.sol
│   │   ├── interfaces
│   │   │   ├── IInterestRateModel.sol
│   │   │   ├── IDoubleJumpRateModel.sol
│   │   │   ├── IOwnable.sol
│   │   │   ├── IPToken.sol
│   │   │   ├── IRBAC.sol
│   │   │   ├── IRiskEngine.sol
│   │   │   └── IUpgrade.sol
│   │   ├── modules
│   │   │   ├── InitialModuleBundle.sol
│   │   │   ├── common
│   │   │   │   ├── OwnableModule.sol
│   │   │   │   ├── RBACModule.sol
│   │   │   │   └── UpgradeModule.sol
│   │   │   ├── interestRateModel
│   │   │   │   └── DoubleJumpRateModel.sol
│   │   │   ├── pToken
│   │   │   │   └── PTokenModule.sol
│   │   │   └── riskEngine
│   │   │       └── RiskEngineModule.sol
│   │   ├── storage
│   │   │   ├── DoubleJumpRateStorage.sol
│   │   │   ├── OwnableStorage.sol
│   │   │   ├── PTokenStorage.sol
│   │   │   ├── RBACStorage.sol
│   │   │   ├── RiskEngineStorage.sol
│   │   │   ├── UpgradeStorage.sol
│   │   └── utils
│   │       ├── ExponentialNoError.sol
│   │       ├── OwnableMixin.sol
│   │       └── RBACMixin.sol
└── └── oracles
        ├── ChainlinkOracleProvider.sol
        ├── OracleEngine.sol
        ├── PythOracleProvider.sol
        └── interfaces
            ├── IOracleEngine.sol
            └── IOracleProvider.sol