Citade-sashimi - Algorithmic trading strategies for Sushi

Citade-sashimi - Algorithmic trading strategies for Sushi

The Citade-sashimi hackathon team consisting of Mikko Ohtamaa (CEO & Co-founder, Trading Strategy), Hieu Nguyen and Ken Kunz participated in the ETHDubai x SushiSwap x Mantle Hackathon, at ETHDubai 2023. The hackathon project Citade-sashimi received a winners prize in the Sushi category. Let’s take a look at the project and how it fits within the DeFi ecosystem.

About The Citade-sashimi Project

Citade-sashimi is a hackathon project for ETHDubai 2023 Hackathon and is an algorithmic trading protocol demo for Sushi. Citade-sashimi enables the development of non-custodial active trading strategies on Sushi using self-custodial wallets (MetaMask in this case), vault contracts by Enzyme Finance, Polygon nodes and Trading Strategy oracles.

Citade-Sashimi provides advanced quantitative finance trading algorithms and tools specifically designed for trading on the Sushi protocol. With these tools, professional algorithmic traders can avoid risky centralised exchanges and instead trade on Sushi using their own volume.

DeFi users can access high-quality risk automated, easy-to-invest, trading strategies with risk management and profit sharing. This allows non-custodial DeFi trading to be just as effective as hedge funds on Wall Street. Compared to traditional exchanges like FTX and centralised API services like 3commas, the Sushi DEX offers superior fees and security for users.

With Citade-Sashimi, automated trading strategies are available in a user-friendly yield farming-style interface, featuring Connect wallet, Deposit, and Withdraw buttons. The yields are based on real trading profits, providing an option to make trading a sustainable way to generate long-term yields in DeFi, regardless of market fluctuations.

A familiar smart contract vault interface when participating in trading algorithms. This is a familiar user experience for DeFi traders who are familiar with yield farming.

How we built it

We developed an integration of smart contracts which connects Sushi, Enzyme and Trading Strategy. We also created a strategy development and backtesting environment for Sushi based on Jupyter Python notebooks.

We integrate and deploy:

  • Polygon blockchain for the underlying chain
  • Sushi DEX for the trading venue
  • Enzyme Finance vaults smart contracts for managing strategy portfolio, investor shares and profit sharing
  • Trading Strategy oracle for market data feeds, strategy development and backtesting
  • Sushi adapter smart contract is written in Solidity that integers Sushi, Enzyme and Trading Strategy
  • Foundry for smart contract development
  • MetaMask as a self-custodial wallet solution
  • SvelteKit frontend for the website

You can find our smart contracts deployed on Polygon mainnet

Citade-sashimi in action

The example strategy provided offers DeFi users a solid option for risk-adjusted returns. Compared to ordinary traders, automated 24/7 solutions far outperform them by a large margin. We strongly believe that offering automated risk-managed tools through our automated trading strategies is the key to unlocking better DeFi trading.

  • We show that with tight risk controls and good DEX fees, automated trading strategies can fly
  • Our example portfolio construction strategy for Sushi gives annualised 60% return
  • Maximum pullback 10%, maximum capital at risk per position 2.5%

The equity curve of the example strategy (vs. buy and hold BTC, ETH, MATIC). We show that the dips are much lower with tight stop loss.

Trading statistics of the example strategy. We show what kind of expected wins and losses individual trades this Citade-sashimi example strategy may have.

Next Steps

We hope to launch live trading strategy vaults in partnership with Enzyme and Sushi. For information about the progress, you can hop on the Trading Strategy Discord server.