Wrap

Tokens to WToken

The wrapping process allows users to deposit ERC20/ETH fungible tokens into the WrapX contract in exchange for an WToken representation of the deposited value. The following steps outline the technical flow of this process.

TLDR: What is Wrap?

• Deposited Tokens to Pool

• Receives WToken

• Transaction is logged on-chain

Flow Breakdown

1. User Prepares Wrapping Parameters The user initiates the wrapping process by specifying:

   • Recipient Address: The address that will receive the minted WToken.

   • ETH Wrapping:

     • Token name is encoded in the data parameter.

     • ETH amount is sent as msg.value.

   • ERC20 Wrapping:

     • data parameter includes slippage protection (first 32 bytes as uint256).

     • Remaining bytes in data encode the token name.

2. User Calls the wrap Function

   • Depending on the asset type, the user calls:

     • ETH Wrapping:

       solidityCopyEditwrap(to, data) {value: ethAmount}

       • The data parameter contains only the token name.

     • ERC20 Wrapping:

       solidityCopyEditwrap(to, data)

       • The data parameter contains:

         • First 32 bytes: Slippage amount (as uint256).

         • Remaining bytes: Token name.

3. System Validates Parameters Before proceeding with wrapping, the smart contract performs the following checks:

   • Token Name Validity: Extracts and validates the token name from data.

   • Maximum Supply Constraint: Ensures the new mint does not exceed the contract's defined supply cap.

   • Payment Verification:

     • For ETH: Confirms that msg.value matches the required amount.

     • For ERC20: Ensures the caller has approved and transferred the required token amount.

4. System Calculates Fees

   • The contract applies a 1% fee based on the base wrapped value.

   • The remaining amount defines the wrapped asset value.

5. System Mints an WToken

   • A new WToken is minted to the specified recipient.

   • The WToken includes:

     • A unique tokenId.

     • An associated name, derived from the provided parameters.

     • Metadata referencing the wrapped asset value.

6. System Emits a Wrap Event

   • A blockchain event is emitted with details, including:

     • The recipient's address.

     • The WToken’s tokenId.

     • The amount wrapped (ETH or ERC20).

     • The fee deducted.

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Outcome

• The user receives an WToken representing their wrapped assets.

• The contract holds the deposited WTokens, ensuring they can later be unwrapped.

• The transaction is logged on-chain, allowing for future tracking.

WrapX - Wrap