Namada introduction: asset-agnostic shielded pool, Cubic PoS and the NAM roadmap

02 Nov 2023Thread1,027 words

BreakdownPrivacy ZK NamadaHeliaxZcash Cosmos $NAM

Introduces Namada, a Cosmos SDK L1 with a single multi-asset shielded pool derived from Zcash's Sapling circuit. Covers the vision, Cubic PoS slashing, MASP privacy mechanics, interoperability and governance.

Key claims

MASP extends Sapling for arbitrary assets and notes hide sender, recipient, asset and amount

Cubic slashing penalizes correlated faults

Namada plans to launch with about 257 validators and a 21 epoch unbonding period

Privacy is an individual’s fundamental right. Privacy should be a public good. Or am I wrong, anon? So, let me introduce you to @namada and its mission-driven vision of asset-agnostic privacy powered by ZK tech! Pay attention, they are here to protect your badly exposed ass! 1/ In this thread I will cover: 🟡 5 Key Insights 🟡 Background & Vision 🟡 Consensus Mechanism 🟡 Cryptographic Privacy 🟡 Interoperability 🟡 Tokenomics 🟡 Governance 🟡 Roadmap 2/ 🚧 5 Key Insights 🚧 1️⃣ Privacy beyond the Cosmos Namada is a Cosmos SDK based L1 developed by @heliaxdev that aims to provide a single privacy pool shared across all crypto-assets and networks. 3/ 2️⃣ Cutting-edge ZK Tech This is based on cutting-edge ZK tech, which includes the Multi-Asset Shielded Pool (MASP) and the Convert Circuit (CC). MASP offers a unified, asset-agnostic privacy set and CC enables programmable asset conversions (e.g., distributing yield). 4/ 3️⃣ Strong Interoperability Focus Namada will be interoperable with IBC networks and Ethereum out of the gates. Additionally, there are plans to extend interop to other chains like Zcash down the road. 5/ 4️⃣ Privacy is a Public Good In Namada’s vision, privacy is a public good. Contributors to the shielded set are rewarded with its native NAM token, which will also be distributed toward retroactive and proactive public goods funding. 6/ 5️⃣ Programmable Privacy Namada's internal programmability through the CC is limited, but shielded actions will enable multi-chain programmability. Users will be able to interact with existing external dapps on connected networks without exiting the shielded pool. 7/ Background & Vision The digital age introduces increasingly more challanges to individuals' privacy. This is driven by technological advancements and justified by the rallying cries of security and transparency. 8/ However, this comes at significant cost. This impairs the space in which individuals can act, think, and engage without fear of observation or judgment. 9/ We are what we do and in this digital age, we primarily produce data. Under this paradigm, the preservation of one's control over personal data is not just a matter of preference but is synonymous with the preservation of self. 10/ One key struggle for preservation of this fundamental right that is also highly relevant in the context of crypto, is financial privacy. With public blockchains being inherently transparent, true financial privacy across applications and networks is hard to achieve. 11/ Namada recognizes this problem and sees financial privacy not as a mere feature but as a foundational human right. In a future future where @namada makes privacy a public good, users will not ask for privacy. They will expect it. 12/ With Namada, individuals will be able to navigate the blockchain space with the confidence that their personal information is always respected and protected. 13/ 🚧 Consensus Mechanism 🚧 Namada uses a unique Bonded Proof-of-Stake (BPoS) variant called Cubic PoS together with Tendermint BFT for consensus. 14/ Like other Cosmos BPoS chains, validators are selected in a pseudo-random process with probabilities proportionally to their stake (self-staked and delegated). Selected validators produce and sign blocks. 15/ Validator stakes are bonded to increase security. Validators and delegators must wait 21 epochs (1 epoch = ~1 day) after an un-stake request before receiving their tokens. Namada plans to launch with around 257 validators. 16/ Namada's consensus mechanism is secured by crypto-economic reward & penalty mechanisms. In Namada’s rewards mechanism, validators receive block rewards proportional to their amount of stake. 17/ Validators set a commission rate, which is the percentage of rewards they keep for themselves, before passing on the rest to their delegators proportional to stake. However, Namada’s variant automatically compounds all rewards, removing the need for re-staking manually. 18/ Cubic PoS gets its name from Namada’s penalties mechanism. Instead of slashing validators linearly, Namada implements cubic slashing. The % of stake slashed is proportional to the cube of total stake (whether from one or many validators) that misbehaved at the same time. 19/ Cubic slashing encourages diversity within validator configurations and infrastructure architecture by pricing into the incentive mechanism the risk to protocol security of correlated faults. 20/ 🚧 Cryptographic Privacy 🚧 The MASP is an extension of Sapling, a circuit created by the Electric Coin Company for Zcash. This extension includes added support for arbitrary assets. 21/ The MASP handles the minting and burning of shielded assets, known as notes, as they move between shielded and transparent Namada accounts. 22/ Namada’s vision of asset-agnostic privacy in a multi-chain world is based on the concept of a single shielded pool for all assets (fungible and non-fungible). 23/ This enhances privacy compared to having separate pools for each asset. This is particularly important for unique or low-volume assets, as they could be easily de-anonymized by tracking entries and exits in individual pools. It is also more cost effective (see below). 24/ Within MASP, all transactions are indistinguishable from one another. The creation of notes is visible, but… 🟡 Senders 🟡 Recipients 🟡 Asset type 🟡 Amount …are all obfuscated. 25/ Everything outside of the MASP is visible in transparent accounts, just like on other chains, such as Ethereum. 26/ A note in the MASP is minted by a zero-knowledge proof (ZKP) that proves three values: 🟡 Asset type: the type of asset (e.g., ETH, NAM, or an NFT) 🟡 Amount: the number of units of the asset 🟡 Address: the owner of the asset(s) and note 27/ Notes function in a model similar to Unspent Transaction Output (UTXO) as they record the values of assets. However, unlike UTXOs, these notes are not part of the public chain state. 28/ This unique status exists because notes are represented on-chain by two Merkle trees: a commitment tree and a nullifier tree. 29/ A note is spent by: 1️⃣ Proving that an inclusion exists in the commitment tree. This confirms that the note exists, is owned by the user spending it & that the balance of the transaction is preserved, while ensuring no assets were created or destroyed during the transfer. 30/ 2️⃣ Revealing a nullifier which does not already exist in the nullifier tree. This step ensures each note can only be spent once, avoiding double-spend.