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BTC staking tracker

This package provides the implementation of the BTC staking tracker.

Overview

BTC staking tracker is a daemon program that relays information between Babylon and Bitcoin for facilitating the Bitcoin staking protocol. This includes three routines:

  • Unbonding watcher routine: upon observing an unbonding transaction of a BTC delegation on Bitcoin, the routine reports the transaction's signature from the staker to Babylon, such that Babylon will unbond the BTC delegation on its side.
  • BTC slasher: upon observing a slashable offence launched by a finality provider, the routine slashes the finality provider and its BTC delegations.
  • Atomic slasher: upon observing a selective slashing offence where the finality provider maliciously signs and submits a BTC delegation's slashing transaction to Bitcoin, the routine reports the offence to BTC slasher and Babylon.

Dependencies

The BTC staking tracker includes the following dependencies:

  • A BTC client for querying Bitcoin blocks/transactions.
  • A BTC notifier for getting new events (mainly new BTC blocks) in Bitcoin.
  • A Babylon client for submitting transactions to and querying Babylon.

Routines

Unbonding watcher routine

The unbonding watcher routine aims to notify Babylon about early unbonding events of BTC delegations. It includes the following subroutines:

  • handleNewBlocks routine: Upon each new BTC block, save its height as the Bitcoin's tip height
  • fetchDelegations routine: Periodically, fetch all active BTC delegations from Babylon, and send them to the handleDelegations routine.
  • handleDelegations routine:
    • Upon each new BTC delegation, spawn a new goroutine watching the event that the BTC delegation's unbonding transaction occurs on Bitcoin.
    • Upon a BTC delegation is expired, stop tracking the BTC delegation.
  • Upon seeing an unbonding transaction of a BTC delegation on Bitcoin, notify Babylon that the corresponding BTC delegation is unbonded via a MsgBTCUndelegate message.

BTC slasher routine

The BTC slasher routine aims to slash adversarial finality providers and their BTC delegations. The slashable offences launched by finality providers include

  • Equivocation where the finality provider signs two conflicting blocks at the same height, and
  • Selective slashing where the finality provider signs the slashing transaction of a victim BTC delegation and submits it to Bitcoin.

The BTC slasher includes the following subroutines:

  • a routine that subscribes to Babylon and forwards all events about finality signatures to the equivocationTracker routine.
  • equivocationTracker routine: Upon an event of a finality signature,
    1. Check if the event contains an evidence of equivocation.
    2. If yes, then forward the event to the use the extractable one-time signature's extractability property to extract the equivocating finality provider's secret key.
    3. Forward the secret key to the slashingEnforcer routine.
  • slashingEnforcer routine: upon a slashed finality provider's secret key,
    1. Find all BTC delegations that are active or unbonding under this finality provider
    2. Try to submit the slashing and unbonding slashing transactions of these BTC delegations to Bitcoin.

Atomic slasher routine

The atomic slasher routine aims to slash finality providers that have conducted selective slashing offences. In a selective slashing offence, the finality provider maliciously signs and submits a BTC delegation's slashing transaction to Bitcoin, without affecting other BTC delegations. Babylon circumvents the selective slashing offences by enforcing the atomic slashing property: if one BTC delegation is slashed, all other BTC delegations under this finality provider will be slashed as well. This is achieved by using a cryptographic primitive called adaptor signature. The atomic slasher includes the following routines:

  • btcDelegationTracker routine: periodically retrieves all BTC delegations and saves them to a BTCDelegationIndex cache.
  • slashingTxTracker routine: upon a BTC block,
    1. For each transaction, check whether it is a slashing transaction in the BTCDelegationIndex cache.
    2. If a transaction is identified as a slashing transaction, send it to the selectiveSlashingReporter routine.
  • selectiveSlashingReporter routine: upon a slashing transaction, 2. Retrieve the BTC delegation and its finality provider from Babylon. 3. If the finality provider is slashed, skip this BTC delegation. 4. Try to extract the finality provider's secret key by comparing the covenant Schnorr signatures in the slashing transaction and the covenant adaptor signatures. 5. If successful, then report the selective slashing offence to Babylon, and forward the extracted secret key to the BTC slasher routine.