Summary
This proposal seeks approval from the Stargate DAO to add Predicate as a required DVN to the existing 2-of-2 DVN set, for all routes to and from Ethereum and Plume, making it a 3-of-3 set.
Background
Since Stargate V2 went live, the Stargate protocol has had 2 required DVNs configured across all pathways: StargateDVN & NethermindDVN. Being built on LayerZero V2, this security set is configurable by pathway, for both required and optional DVNs.
Predicate is a network for building pre-transaction policies. Through the Predicate ecosystem, developers and organizations define rules for onchain interactions, integrating expressive pre-transaction logic into onchain applications. These rules, like legos, can be stacked to form policies, which are enforced by the Predicate Network.
Policies are used to secure onchain financial applications for use cases such as:
- Compliant token bridges and privacy
- Dynamic blacklists for regulated asset flows
- Clean vaults and liquidity pools to onboard institutional capital
- Preventing commingling of funds for real world assets
Learn more about Predicate in their documents here and their recent whitepaper here
As an RWA L2, Plume needs to foster an ecosystem that meets the needs of both crypto-native builders and traditional financial institutions. Crucially, this means that they need an ecosystem with healthy liquidity that is not originating from illicit finance while also setting foundational standards that allow flexibility for users and dapps.
Predicate is working with the Plume team to build and enforce policies for its token bridges. Specifically, Predicate is used to set rules that restrict the inflow of assets originating from sanctioned entities, without altering the user experience. The Predicate Network builds a real-time dynamic blacklist based on sanctioned addresses, as identified by the U.S. Office of Foreign Assets Control, and their counterparties. Based on this blacklist, the Predicate Network validates inbound assets to the Plume Network.
Proposal
This proposal aims to have Predicate become a required DVN as part of the existing 2-of-2 DVN set, making it a 3-of-3 set for routes to and from Ethereum and Plume. All other routes would continue using the existing 2-of-2 DVN set at the moment.
Diagram of PredicateDVN architecture
- Predicate labs entity DVN sends context to the Request Transformer.
- Request Transformer sends a request attestation to the Predicate API, specifying the PolicyContract as the destination.
- Predicate API fetches the Policy ID from the Application-Specific PolicyContract on the Source Chain.
- Predicate API returns signatures along with compliance status back to the Request Transformer.
- Request Transformer sends true/false (based on the outcome) back to the Predicate labs entity DVN.
Execution
Upon passing this proposal, the Stargate foundation will rewire routes to and from Ethereum and Plume to ensure the Predicate DVN is a part of all Stargate transactions transferring assets between Ethereum and Plume.