PwC Crypto Assurance: Enterprise Yield Farming Compliance Framework

// Traditional accounting entry - simple
const simpleTransaction = {
  debit: "Cash",
  credit: "Investment",
  amount: 100000,
  date: "2025-07-22"
};

// Yield farming transaction - complex
const yieldFarmTransaction = {
  initialDeposit: {
    token: "USDC",
    amount: 100000,
    protocol: "Compound",
    timestamp: "2025-07-22T10:30:00Z"
  },
  rewardTokens: ["COMP", "USDC"],
  impermanentLoss: -2500,
  gasFeesUSD: 150,
  protocolRisk: "Medium",
  taxImplications: "Multiple jurisdictions"
};

# PwC Protocol Risk Assessment Framework
class ProtocolRiskAssessment:
    def __init__(self, protocol_data):
        self.protocol = protocol_data
        self.risk_factors = {
            'smart_contract_audit': 0,
            'tvl_stability': 0,
            'governance_maturity': 0,
            'regulatory_clarity': 0,
            'technical_complexity': 0
        }
    
    def calculate_risk_score(self):
        """
        Calculates comprehensive risk score for yield farming protocol
        Returns: Risk score (0-100, lower is better)
        """
        # Smart contract audit score (40% weight)
        audit_firms = self.protocol.get('audit_firms', [])
        if 'Trail of Bits' in audit_firms or 'OpenZeppelin' in audit_firms:
            self.risk_factors['smart_contract_audit'] = 15
        elif len(audit_firms) >= 2:
            self.risk_factors['smart_contract_audit'] = 25
        else:
            self.risk_factors['smart_contract_audit'] = 40
        
        # TVL stability analysis (25% weight)
        tvl_variance = self.protocol.get('tvl_30day_variance', 0)
        if tvl_variance < 0.1:  # Less than 10% variance
            self.risk_factors['tvl_stability'] = 5
        elif tvl_variance < 0.3:  # Less than 30% variance
            self.risk_factors['tvl_stability'] = 15
        else:
            self.risk_factors['tvl_stability'] = 25
        
        # Calculate weighted risk score
        total_risk = sum(self.risk_factors.values())
        return min(total_risk, 100)
    
    def generate_compliance_report(self):
        """
        Generates PwC-standard compliance documentation
        """
        risk_score = self.calculate_risk_score()
        
        report = {
            'protocol_name': self.protocol.get('name'),
            'assessment_date': datetime.now().isoformat(),
            'overall_risk_score': risk_score,
            'risk_category': self.categorize_risk(risk_score),
            'recommended_allocation': self.calculate_allocation_limit(risk_score),
            'monitoring_requirements': self.get_monitoring_requirements(risk_score),
            'compliance_status': 'APPROVED' if risk_score < 30 else 'REVIEW_REQUIRED'
        }
        
        return report

// Smart Contract Monitoring Integration
pragma solidity ^0.8.19;

interface IPwCComplianceOracle {
    function reportTransaction(
        address protocol,
        uint256 amount,
        bytes32 transactionType,
        uint256 timestamp
    ) external;
    
    function checkComplianceStatus(
        address user,
        address protocol
    ) external view returns (bool isCompliant, string memory reason);
}

contract EnterpriseYieldFarmingVault {
    IPwCComplianceOracle public complianceOracle;
    
    mapping(address => uint256) public userAllocations;
    mapping(address => bool) public approvedProtocols;
    
    event ComplianceViolation(
        address indexed user,
        address indexed protocol,
        string reason,
        uint256 timestamp
    );
    
    modifier onlyCompliant(address _protocol) {
        (bool isCompliant, string memory reason) = 
            complianceOracle.checkComplianceStatus(msg.sender, _protocol);
        
        require(isCompliant, reason);
        _;
    }
    
    function depositToYieldFarm(
        address _protocol,
        uint256 _amount
    ) external onlyCompliant(_protocol) {
        // Pre-transaction compliance check
        require(approvedProtocols[_protocol], "Protocol not approved");
        require(_amount <= getMaxAllocation(msg.sender), "Exceeds allocation limit");
        
        // Execute yield farming deposit
        IYieldProtocol(_protocol).deposit(_amount);
        
        // Report to PwC compliance system
        complianceOracle.reportTransaction(
            _protocol,
            _amount,
            keccak256("YIELD_FARM_DEPOSIT"),
            block.timestamp
        );
        
        userAllocations[msg.sender] += _amount;
    }
    
    function getMaxAllocation(address _user) public view returns (uint256) {
        // Enterprise allocation limits based on risk assessment
        // Implementation depends on PwC risk framework
        return 1000000 * 10**18; // Example: 1M USDC max
    }
}

// Automated Regulatory Reporting System
interface ComplianceReport {
  jurisdiction: string;
  reportingPeriod: {
    start: Date;
    end: Date;
  };
  transactions: YieldFarmTransaction[];
  riskMetrics: RiskMetrics;
  taxImplications: TaxCalculation[];
}

class PwCRegulatoryReporting {
  private jurisdictions: Map<string, RegulatoryFramework>;
  
  constructor() {
    this.jurisdictions = new Map([
      ['US', new USCryptoRegulations()],
      ['EU', new EUMiCAFramework()],
      ['SG', new SingaporePaymentServicesAct()],
      ['UK', new UKCryptoRegulations()]
    ]);
  }
  
  async generateComplianceReport(
    transactions: YieldFarmTransaction[],
    jurisdiction: string,
    reportingPeriod: DateRange
  ): Promise<ComplianceReport> {
    
    const regulatory = this.jurisdictions.get(jurisdiction);
    if (!regulatory) {
      throw new Error(`Unsupported jurisdiction: ${jurisdiction}`);
    }
    
    // Filter transactions by reporting period
    const periodTransactions = transactions.filter(tx => 
      tx.timestamp >= reportingPeriod.start && 
      tx.timestamp <= reportingPeriod.end
    );
    
    // Calculate risk metrics
    const riskMetrics = await this.calculateRiskMetrics(periodTransactions);
    
    // Generate tax implications
    const taxCalculations = await regulatory.calculateTaxImplications(
      periodTransactions
    );
    
    // Compile compliance report
    const report: ComplianceReport = {
      jurisdiction,
      reportingPeriod,
      transactions: periodTransactions,
      riskMetrics,
      taxImplications: taxCalculations
    };
    
    // Validate against regulatory requirements
    const validationResult = await regulatory.validateReport(report);
    if (!validationResult.isValid) {
      throw new Error(`Report validation failed: ${validationResult.errors.join(', ')}`);
    }
    
    return report;
  }
  
  private async calculateRiskMetrics(
    transactions: YieldFarmTransaction[]
  ): Promise<RiskMetrics> {
    
    const totalValue = transactions.reduce((sum, tx) => sum + tx.usdValue, 0);
    const protocolDiversification = new Set(transactions.map(tx => tx.protocol)).size;
    const averageProtocolRisk = transactions.reduce((sum, tx) => 
      sum + tx.protocolRiskScore, 0) / transactions.length;
    
    return {
      totalExposure: totalValue,
      protocolCount: protocolDiversification,
      averageRiskScore: averageRiskScore,
      concentrationRisk: this.calculateConcentrationRisk(transactions),
      liquidityRisk: await this.assessLiquidityRisk(transactions)
    };
  }
}

// Usage example for enterprise implementation
const pwcReporting = new PwCRegulatoryReporting();

// Generate quarterly compliance report for US operations
const q3Report = await pwcReporting.generateComplianceReport(
  yieldFarmingTransactions,
  'US',
  {
    start: new Date('2025-07-01'),
    end: new Date('2025-09-30')
  }
);

console.log('Q3 Compliance Report Generated:', q3Report);

// Governance Integration for Enterprise Yield Farming
class EnterpriseGovernanceFramework {
  constructor(multisigAddress, complianceOracle) {
    this.multisig = multisigAddress;
    this.complianceOracle = complianceOracle;
    this.approvalThreshold = 3; // Require 3/5 signatures
  }
  
  async proposeYieldFarmingStrategy(strategyDetails) {
    // Step 1: Compliance pre-check
    const complianceCheck = await this.complianceOracle.validateStrategy(
      strategyDetails
    );
    
    if (!complianceCheck.approved) {
      throw new Error(`Strategy rejected: ${complianceCheck.reason}`);
    }
    
    // Step 2: Risk assessment
    const riskAssessment = await this.assessStrategyRisk(strategyDetails);
    
    // Step 3: Create governance proposal
    const proposal = {
      id: generateProposalId(),
      strategy: strategyDetails,
      riskScore: riskAssessment.score,
      complianceApproval: complianceCheck.approvalId,
      requiredSignatures: this.approvalThreshold,
      expirationDate: new Date(Date.now() + 7 * 24 * 60 * 60 * 1000), // 7 days
      status: 'PENDING'
    };
    
    return proposal;
  }
  
  async executeApprovedStrategy(proposalId) {
    const proposal = await this.getProposal(proposalId);
    
    // Verify all requirements met
    if (proposal.signatures.length < this.approvalThreshold) {
      throw new Error('Insufficient signatures for execution');
    }
    
    if (proposal.expirationDate < new Date()) {
      throw new Error('Proposal expired');
    }
    
    // Execute yield farming strategy with compliance monitoring
    const execution = await this.deployYieldFarmingStrategy(proposal.strategy);
    
    // Log execution for audit trail
    await this.complianceOracle.logStrategyExecution({
      proposalId,
      executionHash: execution.transactionHash,
      timestamp: new Date(),
      executedBy: msg.sender
    });
    
    return execution;
  }
}