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Nova Rewards — Product Requirements Document

Version: 1.0
Last Updated: March 28, 2026
Status: Draft — Pending Sign-off

Product Vision

Nova Rewards transforms traditional loyalty programs into a transparent, interoperable, blockchain-powered rewards ecosystem. By tokenizing loyalty points on the Stellar network, we give users true ownership of their rewards while enabling businesses to create engaging, cross-merchant loyalty experiences with minimal friction and maximum trust.

Target Users

Primary Users

  1. Merchants & Businesses

    • Small to medium-sized businesses seeking modern loyalty solutions
    • E-commerce platforms wanting to differentiate through blockchain rewards
    • Multi-location retailers needing unified loyalty infrastructure
    • Web3-native brands targeting crypto-savvy customers

  2. End Customers

    • Crypto-curious consumers exploring blockchain utility
    • Loyalty program participants frustrated with traditional point systems
    • Users seeking transferable, redeemable digital assets
    • Early adopters interested in DeFi and tokenized rewards

Secondary Users

  1. Platform Administrators
    • System operators managing contract deployments and upgrades
    • Support teams handling merchant onboarding and troubleshooting

Problem Statement

Traditional loyalty programs suffer from:

  • Fragmentation: Points locked within single merchant ecosystems with no portability
  • Opacity: Hidden expiration rules, arbitrary devaluations, unclear redemption terms
  • Limited Value: Restricted redemption options, poor liquidity, no peer-to-peer transfer
  • High Friction: Complex enrollment, delayed point crediting, cumbersome redemption flows
  • Trust Deficit: Centralized control enables unilateral program changes without user consent

Nova Rewards solves these problems by leveraging blockchain transparency, smart contract automation, and Stellar's fast, low-cost infrastructure to create a loyalty ecosystem where rewards are truly owned, freely transferable, and verifiably fair.

Goals & Success Metrics

Business Goals

  1. Merchant Adoption: Onboard 50+ merchants by Public Launch
  2. User Engagement: Achieve 10,000+ registered wallets within 6 months of launch
  3. Transaction Volume: Process 100,000+ reward transactions in Year 1
  4. Platform Sustainability: Establish revenue model through merchant fees or premium features

Key Performance Indicators (KPIs)

Metric Target (3 months post-launch) Target (6 months post-launch)
Daily Active Users (DAU) 500 2,000
Points Issued per Day 50,000 NOVA 200,000 NOVA
Redemption Rate 15% 25%
Referral Conversion Rate 10% 20%
Staking Participation Rate N/A (V2 feature) 30% of active users
Average Transaction Time <5 seconds <5 seconds
Merchant Retention (90-day) 70% 80%

Feature List

Core Features (Must Have)

1. Blockchain Infrastructure

  • NOVA Token Contract — Stellar-based asset issuance with mint/burn/transfer capabilities
  • Reward Pool Contract — Secure deposit/withdrawal mechanism for merchant reward funding
  • Admin Roles Contract — Multi-signature admin management with two-step transfer
  • Contract Upgrade System — Safe WASM upgrade path with data migration support

Related Issues: #206 (upgrade), #205 (precision)

2. Reward Distribution

  • Merchant Dashboard — Campaign creation, reward issuance, transaction history
  • Automated Reward Crediting — Backend API for programmatic point distribution
  • Batch Reward Processing — Efficient multi-recipient reward distribution
  • Reward Rate Configuration — Flexible percentage-based reward calculations with 6-decimal precision

Related Issues: #205 (fixed-point arithmetic)

3. User Wallet Integration

  • Freighter Wallet Connect — Browser extension integration for transaction signing
  • Trustline Management — Automated trustline creation for NOVA asset
  • Balance Display — Real-time NOVA balance and transaction history
  • Peer-to-Peer Transfer — User-to-user NOVA token transfers

4. Referral System

  • Referral Registration — One-time referrer assignment per wallet
  • Referral Tracking — Counter-based leaderboard for top referrers
  • Referral Rewards — Automated bonus crediting for successful referrals
  • Duplicate Prevention — Enforcement of single-referrer-per-user rule

Related Issues: #101 (referral logic)

5. Redemption System

  • Merchant Redemption Interface — Point-for-product/service exchange
  • Redemption History — Audit trail of all redemption transactions
  • Multi-Merchant Redemption — Cross-merchant point acceptance

Enhanced Features (Should Have)

6. Cross-Asset Swaps

  • DEX Integration — Multi-hop swap routing for NOVA → XLM conversion
  • Slippage Protection — Minimum output guarantees for swap transactions
  • Swap Path Optimization — Up to 5-hop routing for best exchange rates

Related Issues: #200 (swap implementation)

7. Vesting & Time-Locked Rewards

  • Vesting Schedule Creation — Cliff and linear vesting configurations
  • Automated Release — Time-based token unlock mechanism
  • Beneficiary Management — Multi-schedule support per user

8. Analytics & Reporting

  • Merchant Analytics Dashboard — Campaign performance, ROI metrics
  • User Activity Insights — Engagement patterns, redemption behavior
  • Leaderboard System — Top earners, top referrers, most active merchants

9. Email Notifications

  • Reward Alerts — Email confirmation of points earned
  • Redemption Confirmations — Transaction receipts
  • Campaign Announcements — Merchant promotional communications

Future Features (Could Have)

10. Staking & Yield

  • NOVA Staking Pools — Lock tokens for yield generation
  • Tiered Rewards — Bonus multipliers for staked balances
  • Governance Participation — Voting rights for stakers (V2)

11. NFT Integration

  • Achievement Badges — Non-fungible rewards for milestones
  • Exclusive Access Tokens — NFT-gated merchant perks
  • Collectible Campaigns — Limited-edition digital collectibles

12. Mobile Application

  • Native iOS/Android Apps — Mobile-first user experience
  • Push Notifications — Real-time reward alerts
  • QR Code Redemption — In-store point-of-sale integration

Feature Priority Matrix

Priority Feature GitHub Issues Milestone
Must Have NOVA Token Contract — Alpha
Must Have Reward Pool Contract — Alpha
Must Have Admin Roles Contract — Alpha
Must Have Referral System #101 Alpha
Must Have Fixed-Point Arithmetic #205 Alpha
Must Have Contract Upgrade System #206 Alpha
Must Have Merchant Dashboard — Beta
Must Have User Wallet Integration — Beta
Must Have Reward Distribution API — Beta
Must Have Redemption System — Beta
Must Have Stellar Integration #246 Beta
Should Have Cross-Asset Swaps #200 Public Launch
Should Have Vesting Contracts — Public Launch
Should Have Analytics Dashboard — Public Launch
Should Have Email Notifications — Public Launch
Should Have Leaderboard System — Public Launch
Could Have Staking Pools — V2
Could Have NFT Integration — V2
Could Have Mobile Apps — V2
Won't Have Fiat On-Ramp (use 3rd party) — —
Won't Have Built-in KYC (use 3rd party) — —

Milestone Schedule

Milestone Target Date Required Issues Success Criteria
Alpha (Internal) Q2 2026 #101, #205, #206 All smart contracts deployed to Testnet; basic reward issuance functional; internal team testing complete
Beta (Closed) Q3 2026 #200, #246 10 pilot merchants onboarded; 500 beta users; swap functionality live; feedback collection system operational
Public Launch Q4 2026 All Must Have + Should Have 50+ merchants; 5,000+ users; full feature set live on Mainnet; documentation complete; support infrastructure ready
V2 (Enhanced) Q2 2027 Staking, NFTs, Mobile Staking pools live; NFT rewards integrated; mobile apps in app stores; 20,000+ users

Out of Scope

The following features are explicitly excluded from the current roadmap:

  1. Fiat Payment Processing — Merchants handle fiat transactions independently; Nova Rewards focuses on reward layer only
  2. Built-in KYC/AML — Compliance delegated to wallet providers and merchant systems
  3. Custodial Wallets — Users must bring their own Stellar wallets (non-custodial model)
  4. Multi-Chain Support — Stellar-only for V1; other chains considered for V2+
  5. Merchant Payment Gateway — Not a POS system; integrates with existing payment infrastructure
  6. Customer Support Chat — Email/ticket-based support only; no live chat in V1
  7. Automated Market Making — DEX liquidity provision handled by external protocols
  8. Credit/Lending Features — No borrowing against NOVA balances in V1

Risks & Mitigations

Technical Risks

Risk Impact Probability Mitigation
Smart Contract Vulnerabilities Critical Medium Comprehensive test coverage; external audit before Mainnet; bug bounty program
Stellar Network Congestion High Low Monitor network health; implement retry logic; maintain XLM reserves for fees
WASM Size Limits Medium Medium Storage schema optimization (#205); modular contract architecture; regular size audits
Upgrade Migration Failures High Low Extensive upgrade testing (#206); rollback procedures; staged rollout
DEX Liquidity Issues Medium Medium Partner with liquidity providers; set realistic slippage tolerances; educate users

Business Risks

Risk Impact Probability Mitigation
Low Merchant Adoption Critical Medium Pilot program with incentives; clear ROI documentation; white-glove onboarding
Regulatory Uncertainty High Medium Legal counsel review; terms of service clarity; geographic restrictions if needed
User Wallet Friction High High Detailed onboarding guides; video tutorials; Freighter partnership for UX improvements
Token Value Volatility Medium High Merchant-funded pools; no speculative trading emphasis; utility-focused messaging
Competitor Launch Medium Medium Rapid iteration; community building; unique Stellar advantages (speed, cost)

Operational Risks

Risk Impact Probability Mitigation
Key Management Failures Critical Low Hardware security modules; multi-sig admin controls; documented key rotation procedures
Backend Downtime High Low Redundant infrastructure; monitoring/alerting; 99.9% uptime SLA
Support Overload Medium High Comprehensive FAQ; community forums; tiered support system; chatbot for common issues
Data Loss High Low Automated backups; blockchain immutability for critical data; disaster recovery plan

Technical Architecture Summary

Smart Contracts (Soroban/Rust)

  • nova_token — ERC-20-style token with mint/burn
  • reward_pool — Merchant deposit/withdrawal management
  • admin_roles — Multi-sig admin with two-step transfer
  • vesting — Time-locked token release
  • referral — Referral tracking and reward crediting
  • nova-rewards — Core rewards logic with swap integration

Backend (Node.js/Express)

  • RESTful API for merchant/user operations
  • PostgreSQL database for off-chain data
  • Stellar SDK integration for transaction submission
  • JWT authentication for merchant dashboards

Frontend (Next.js/React)

  • Merchant dashboard (campaign management, analytics)
  • User dashboard (balance, history, redemption)
  • Freighter wallet integration
  • Responsive design for mobile/desktop

Infrastructure

  • Stellar Testnet (Alpha/Beta)
  • Stellar Mainnet (Public Launch)
  • Horizon API for blockchain queries
  • AWS/Vercel hosting (TBD)

Success Criteria for Launch

Alpha Readiness

  • All 6 smart contracts deployed and tested on Testnet
  • Fixed-point arithmetic validated (#205)
  • Upgrade mechanism tested (#206)
  • Referral system functional (#101)
  • Internal team can issue/redeem rewards end-to-end

Beta Readiness

  • Merchant onboarding flow complete
  • User wallet connection working (Freighter)
  • Stellar integration guide published (#246)
  • 10 pilot merchants signed up
  • 500 beta users registered
  • Feedback collection system operational

Public Launch Readiness

  • All Must Have + Should Have features live
  • Smart contract audit complete (external firm)
  • Mainnet deployment successful
  • Documentation complete (user guides, API docs, merchant handbook)
  • Support infrastructure ready (ticketing system, FAQ, tutorials)
  • 50+ merchants onboarded
  • Marketing campaign launched
  • Legal terms of service finalized

Sign-off

This PRD requires approval from the project lead and at least two contributors before implementation begins.

Role Name Signature Date
Project Lead [Pending] [Pending] [Pending]
Contributor 1 [Pending] [Pending] [Pending]
Contributor 2 [Pending] [Pending] [Pending]

Appendix

Related Documentation

Revision History

Version Date Author Changes
1.0 2026-03-28 AI Assistant Initial PRD creation

Document Status: Draft — Awaiting review and sign-off from project stakeholders.