Fairblock: Update for community
We’ve been fortunate to start our journey in the Cosmos ecosystem which has proven to be an ideal ecosystem for the most innovative ideas in the industry. We really appreciate the endless support from all teams in the Cosmos ecosystem since the announcement of Prop 72. We would love to share some updates with the community about Fairblock during the last six months:
What’s Fairblock?
Fairblock’s current focus is bringing “pre-execution privacy” to the Cosmos ecosystem (and other ecosystems in the future) for enabling more innovative applications which were previously limited and protecting users from on-chain exploits. We are using advanced cryptography schemes (distributed identity-based encryption, DKG, MPC, ZK) to encrypt transactions in the front-end of applications and decrypt them in a decentralized way after the finalization of inclusion and ordering of transactions in participating Cosmos chains. This can enable applications such as sealed-bid auctions, private governance, private trading, encrypted sequencing, and randomness generation and also protect users from bad-MEV and front-running strategies.
What have we done so far?
During the last six months, we’ve transformed our academic research into a fully functional infrastructure for enabling “pre-execution privacy” and explored various applications and partnerships in the ecosystem. To be more specific, we have developed cryptographic libraries (distributed identity-based encryption, DKG, MPC, ZK) that can be integrated with Cosmos applications in the front-end and in the consensus layer. Cosmos L1s will be able to install our PEP (pre-execution privacy) Cosmos SDK module in order to receive encrypted transactions directly onto their chain, consequently, validators of our Cosmos L1 FairyRing (or alternatively validators of the Cosmos application themselves) will generate a single private key that can decrypt all transactions in the each block. Committed transactions will be decrypted on the Cosmos application side, and executed with respect to the previously fixed order and inclusion (this hybrid solution still allows normal and plaintext transactions). Currently, research, design, and development of the first MVP of this infrastructure are done, and we are improving it after our recent security audit with Oak as well as our first testnet with a limited set of validators that helped us to further understand the engineering challenges and expectations. We’ve also developed and explored partnerships with several big names in the ecosystem for our different applications.
How do we provide value to the hub and Cosmos ecosystem?
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We are leveraging all the recent developments and flexibilities in the ecosystem including IBC, ABCI++ vote extensions, Blockbuster/POB, BeginBlock/EndBlock, etc. These technologies are unique to the Cosmos ecosystem, and we’re showcasing these features in a working example to developers. Everything, everywhere, all at once. We believe original technical innovations and strong governance have differentiated Cosmos from the others and is the main reason behind the value of it and we want to help to further develop it.
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We are enabling private governance for the Hub (and other app chains later) which can help with less manipulation, less voter apathy, and greater efficiency of the process.
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We have developed and tested advanced efficient cryptographic libraries that are integrated with Cosmos chains for the first time.
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PEP module can enable many innovative applications such as sealed-bid auctions for all chains which can bring more users, more liquidity, and more attention which is all we need.
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Potential transaction fees that we will collect for providing pre-execution privacy to users (and in some cases saving them money) can be collected in Atom which can be a good utility for it.
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Our potential launch with replicated security/ICS can be a good example of a case that it can be useful to the consumer chain and also hub validators by providing utility for ATOM and additional sources of revenues.
Transparency re Replicated Security:
After Prop 72, we’ve received 16250 ATOM to support our research and development for our potential launch with ICS/replicated security. As we mentioned, Fairblock has taken significant technical and business steps in this short time and we are still strongly considering ICS and researching and experimenting with it. During this time we have solely used this grant to pay one of our Cosmos developers in USDC, and are currently working on developing our chain and researching ICS. Before making it happen, there are potential technical and operational challenges that we should figure out:
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Since we are running an MPC and DKG protocol on-chain, our message and bandwidth complexity can be high. While our current library works fine for up to 50 validators, we haven’t tested it for ~150+ validators of the hub. Due to the design of replicated security, we don’t have the option to run it with the top e.g. 50 Cosmos hub validators which does not allow us to ship it very fast. We are going to design (e.g. researching the 5% opt-out idea more), test, and implement optimizations for our scheduling and compressing our DKG messages to make it work. We were not aware of these engineering challenges at the time of the announcement. There was no detailed documentation about this and the technical specifications of replicated security and the implementation are changing; however, we think that we can still make it work, and it’s in our roadmap. So we appreciate your patience while we are figuring it out.
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During the governance proposal for Neutron’s launch, we’ve noticed that there is a strong need for clear tokenomics and narrative for potential revenue expected by the validators which requires a lot of design and attention. We also think that going through complex tokenomics or pre-mature launching a token in parallel before significant adoption and traction can be more harmful to our project and the ecosystem. Our current strategy is focusing on careful technical development and testing, launching with a PoA approach to remain flexible for ICS and tokens, making significant traction while carefully designing our tokenomics with the help of the community, and finally making it happen.
Thank you again for your continuing support, will be back soon with more exciting news!
