Introduction

I previously discussed this idea with few people during Devcon and other developers - exploring another use case for the Shutter encryption network (a commit-reveal network). Specifically, we could leverage Shutter encryption network's commit-reveal capabilities for SAFT/Locked token OTC trading.

I propose to build a decentralized blind auction OTC trading reference implementation demonstrating a verifiable, trustless environment for SAFT and locked token/asset trading. This reference implementation should have production-ready code and can support stakeholder to integrating Shutter Network's production environment. Will address current market inefficiencies in OTC trading while maintaining privacy and preventing information asymmetry.

This mechanism is similar to the leaderless auction proposed here [1] but with some more practical consideration for this use case

The SAFT/Locked token trading typically has three users: a seller, a buyer and a broker.

• The seller is selling some amount of tokens for a price they have in mind
• A number of buyers will bid their price (typically there will be some negotiation) and the amount they're willing to buy
• Brokers usually keep their clients of buyers and sellers and broker the trade in between

Where Shutter comes into play: First off, all bids can be encrypted. This offers some key advantages:

• It will have bind auction instead of brokers having the advantage of knowing all bids where some clients could potentially change theirs bids to their advantage or collude on bid price
• Better trust setup for sellers as all bids are encrypted and timestamped
• Brokers don't have to share their clientele with each other but can still prove they provide honest service

More spec like description listed below: