Shadow Nox

Problem Statement

Shadow Noxis a privacy-preserving, high-performance decentralised finance (DeFi) protocol built onArcology's parallel execution blockchain, designed to create a "dark-pool-like" trading environment while maintaining verifiable aggregate metrics. The project demonstrates the potential of parallel blockchain execution combined with privacy-focused architecture to enable institutional-grade DeFi operations.Core Problem SolvedTraditional DeFi platforms face three critical challenges:Performance Bottlenecks: Sequential transaction processing limits throughput (15-30 TPS on Ethereum L1)Privacy Concerns: All transaction details are publicly visible, exposing trading strategies and positionsHigh Costs: Gas fees make micro-transactions and high-frequency operations economically unviableShadow Nox addresses all three by combining Arcology's parallel execution (10,000-15,000 TPS), privacy-preserving intent architecture, and 100x lower gas costs.Architecture Layers1.Execution Layer: Arcology Parallel BlockchainArcology serves as the smart contract execution environment, processing thousands of transactions simultaneously across multiple EVM instances. Key features:10,000-15,000 TPS: Massive throughput through optimistic concurrency control100% EVM Equivalence: Full Solidity compatibility with zero code changesOptimistic Concurrency: Storage-slot level conflict detection and resolutionPer-User Isolation: Different users can interact with contracts simultaneously without conflicts100x Lower Gas Fees: Significantly reduced transaction costs compared to Ethereum L12.Privacy Layer: Intent-Based ArchitectureShadow Nox implements a privacy-preserving model where individual transaction details are stored as bytes on-chain while maintaining public aggregate metrics:Private (Intent Data as Bytes):Individual swap parameters (token pairs, amounts, slippage)Lending positions (borrow amounts, collateral values)User portfolio compositionsSpecific trade execution detailsPublic (Aggregate Metrics):Total protocol TVL (Total Value Locked)Market-wide swap volumesAverage lending ratesProtocol-level statisticsThis creates a "dark pool" experience where traders can execute large orders without revealing their strategies, while regulators and users can still verify protocol health through aggregate data.3.Oracle Layer: Custom Price Oracle + Pyth Hermes APIA critical innovation in the Shadow Nox is solving the oracle challenge on Arcology:Problem: Pyth Network's on-chain contracts are NOT deployed on the Arcology blockchain.Solution: Custom Oracle architecture that:Fetches real-time price data from Pyth's Hermes API (off-chain)Stores prices on-chain via CustomPriceOracle contractValidates price freshness (default: 60-second staleness threshold)Implements price deviation protection (default: 10% max change)Supports multi-signature updates from authorised Fisher botsProvides aggregate market metrics without exposing individual positionsThis approach maintains data integrity and real-world price accuracy while being fully compatible with Arcology's execution model.4.Relay Layer: EVVM Fisher BotsShadow Nox uses EVVM as aFisher/Relayer bot infrastructure(not as the execution layer). Fisher bots provide:EIP-191 Signatures: Secure transaction signing for relay to ArcologyGasless UX: Users sign intents; Fisher bots execute and pay gasMulti-Platform Interface: WhatsApp and Telegram bot integrationAsync/Sync Nonce Management: Flexible transaction ordering optionsOracle Updates: Fisher bots fetch Pyth prices and update on-chain oracleReward Mechanism: Incentive system for bot operatorsUsers interact through messaging platforms, sign intents with EIP-191, and Fisher bots handle blockchain execution—creating a seamless, non-technical user experience.Core Smart ContractsEncryptedSwap.solPrivacy-preserving token swap contract with:Intent submission with ABI-encoded parameters stored as bytesPrice validation via CustomPriceOracleSlippage protection and deadline enforcementAtomicCounter integration for parallel-execution-friendly aggregate metricsPer-user storage isolation for maximum Arcology parallelismSimpleLending.solDecentralised lending/borrowing protocol featuring:Collateral-based borrowing with health factor monitoringReal-time price feeds from CustomPriceOracleInterest rate calculationsLiquidation mechanisms with price deviation protectionPrivacy-preserving position managementCustomPriceOracle.solCustom Oracle solution providing:Multi-signature price updates from authorised Fisher botsPrice staleness validationConfidence interval trackingBatch update support for gas efficiencyIntegration with Pyth Hermes API data structureAtomicCounter.solArcology-optimised counter for aggregate metrics:Minimises storage-slot conflicts in parallel executionSeparate instances per metric typeConflict-resistant increment operationsDemonstrates Arcology's parallel execution capabilitiesTechnical InnovationsParallel DeFi Primitives: First implementation of high-throughput DeFi operations leveraging Arcology's 10k+ TPS capacityPrivacy Without Full Encryption: Intent-data-as-bytes approach provides privacy while maintaining smart contract logic transparency (MVP approach, with full encryption planned)Off-Chain Oracle Bridge: Custom solution to integrate Pyth's real-time price feeds on blockchains where Pyth isn't deployedFisher Bot Economy: Decentralised relayer network with incentive mechanisms for gasless user experiencesStorage-Optimised Counters: The AtomicCounter pattern minimises conflicts in parallel execution environmentsUse CasesPrivate Trading: Execute large token swaps without revealing strategy or moving markets. Ideal for whales and institutional traders.Dark Pool Liquidity: Match large orders off the visible order book while maintaining price discovery through aggregate metrics.Private Lending: Borrow and lend assets with confidential position management. Only you see your collateral and debt levels.High-Frequency Operations: 10,000-15,000 TPS enables DeFi strategies previously impossible due to throughput constraints.Gasless UX: Messaging app integration with Fisher bot relay makes DeFi accessible to non-technical users.Technical StackBlockchain: Arcology (EVM-equivalent parallel execution)Smart Contracts: Solidity 0.8.20Development: Hardhat, Node.js 18+Oracle: Pyth Hermes API + CustomPriceOracleRelayer Network: EVVM Fisher botsUser Interface: React, Vite, TailwindCSSMessaging: WhatsApp, Telegram bot APIsTesting: Jest, Hardhat test suiteProject PhilosophyShadow Nox represents a vision fornext-generation DeFiwhere:Performance matches centralised exchange speeds (10k+ TPS)Privacy protects individual users while maintaining system transparencyUser experience rivals Web2 applications (messaging app interfaces)Infrastructure costs enable micro-transactions and new DeFi primitivesInstitutional-grade tools become accessible to retail usersThe project demonstrates that blockchain scalability, privacy, and usability can coexist through innovative architecture combining parallel execution, privacy-preserving intent systems, and user-friendly relay networks.

Solution

🏗️ Architecture OverviewShadow Nox is built as a multi-layered system that bridges three distinct blockchain/infrastructure technologies into a cohesive privacy-preserving DeFi protocol. Here's how we pieced it all together:🔧 Core Technologies Used1.Arcology Parallel Blockchain (Execution Layer)What it is: EVM-equivalent blockchain with parallel execution capabilityWhy we used it: Needed true parallel transaction processing for institutional-grade DeFi (10k-15k TPS)How we integrated it:Standardethers.jsconnection - Arcology is 100% EVM-compatible, so no special libraries neededConfigured in hardhat.config.js with custom network parameters (longer timeouts for parallel execution)Used standard Solidity 0.8.20 with compiler optimization enabled (200 runs)// hardhat.config.js - Arcology is just another EVM network! arcologyDevnet: { url: "http://localhost:8545", chainId: 1234, timeout: 60000, // Longer timeout for parallel execution batches gasPrice: "auto" }The Hack: Arcology's parallel execution works automatically, but we discovered you can maximize throughput by designing smart contracts withstorage-slot isolation. We created theAtomicCounterpattern specifically for this.2.Custom Oracle Solution (The "Pyth Without Pyth" Hack)The Problem We Hit: Halfway through development, we discovered Pyth Network's smart contractsdon't exist on Arcology. Pyth only deploys to major chains, and Arcology wasn't supported.The Clever Solution: We built a hybrid oracle that gets the best of both worlds:Real-time price data fromPyth Hermes API(https://hermes.pyth.network) - HTTP REST API, no blockchain neededOn-chain storage via ourCustomPriceOraclecontract deployed on ArcologyFisher bots bridge the gap by fetching from Hermes and updating on-chain// Fetching real Pyth prices via Hermes API const url = new URL('https://hermes.pyth.network/v2/updates/price/latest'); url.searchParams.append('ids[]', ETH_USD_FEED_ID); const response = await fetch(url.toString()); const priceData = await response.json(); // Then push to our on-chain oracle await customOracle.updatePrice( priceId, priceData.parsed[0].price.price, priceData.parsed[0].price.conf, priceData.parsed[0].price.expo, priceData.parsed[0].price.publish_time );What makes this notable:We maintain compatibility with Pyth's data structures (price, conf, expo, publishTime)Added security features Pyth doesn't provide: price deviation protection (prevents 10%+ sudden changes), multi-sig updaters, staleness validationThis pattern could work for ANY blockchain where Pyth isn't deployed yet3.EVVM Fisher Bot Infrastructure (Relay Layer)What it is: Bot network that relays user transactions to blockchainHow we used it: Users interact via WhatsApp/Telegram, bots handle blockchain complexityThe integration:// User sends message → Bot processes → Constructs transaction export async function processSwapIntent(userId, swapData) { // Get user's personal wallet (generated on first interaction) const userWallet = userWalletManager.getOrCreateUserWallet(userId); // Construct EIP-191 signature for EVVM Fisher network const fisherSignature = await constructFisherSignature(swapData, userWallet); // Submit to Arcology with async nonce const asyncNonce = await getNextAsyncNonce(userId); const tx = await swapContract.submitSwapIntent(intentData, asyncNonce); // Update prices from Pyth await updateOnChainPrices(oracleContract, ['ETH/USD', 'BTC/USD'], userWallet); return { success: true, txHash: tx.hash }; }The Hack: We created apersonal wallet systemwhere each Telegram/WhatsApp user gets a deterministic wallet derived from their user ID. Bots hold the keys, making it fully gasless for users.4.AtomicCounter Pattern (Arcology Optimization)This is our most "hacky" innovation for squeezing maximum TPS from Arcology:The Problem: Shared counters create storage-slot conflicts in parallel execution. If 100 swaps try to incrementtotalSwapVolumesimultaneously, they conflict and reduce to sequential execution.The Solution: Separate counter contracts per metric:// Instead of one counter for everything... contract EncryptedSwap { uint256 public totalSwapVolume; // ❌ CONFLICT BOTTLENECK uint256 public totalSwapCount; // ❌ CONFLICT BOTTLENECK // We do this: AtomicCounter public totalSwapVolume; // ✅ Separate contract = separate storage AtomicCounter public totalSwapCount; // ✅ Separate contract = separate storage }EachAtomicCounteris its own contract with its own storage space, minimizing conflicts. On Arcology, this can mean 3x higher TPS for write-heavy operations.🎨 Frontend StackReact 18+Vite(lightning-fast dev server)TailwindCSSfor styling (rapid UI development)ethers.js v6for blockchain interactionRechartsfor data visualizationThe frontend connects directly to Arcology via JSON-RPC, treating it like any other EVM chain.🔐 Privacy Architecture (Intent-Based Storage)The Approach: Instead of full encryption (which would require off-chain execution), we useintent data as bytes:struct SwapIntent { address user; bytes intentData; // ABI-encoded parameters - not human-readable by default uint256 timestamp; bool executed; }Transaction parameters are ABI-encoded before storage, making them non-trivial to parse without knowing the encoding schema. Public aggregate metrics remain visible for transparency.🧪 Testing StrategyIntegration Tests: We simulate parallel execution by running multiple users' transactions in rapid succession:// From Integration.test.js - Parallel swap test const users = [user1, user2, user3, user4, user5]; const promises = users.map(async (user) => { const intentData = createIntentData(...); return encryptedSwap.connect(user).submitSwapIntent(intentData); }); // All execute in parallel on Arcology await Promise.all(promises);Real Pyth Testing: We built test-pyth.js to verify real-time price fetching:$ node test-pyth.js 📡 Fetching real-time prices from Pyth Hermes API... ✓ ETH/USD $3,245.67 ± $2.34 (2s ago) ✓ BTC/USD $67,891.23 ± $45.67 (3s ago)🚀 Deployment PipelineOur deployment script (deploy.js) is smart about Arcology:const isArcology = networkName.includes("arcology"); if (isArcology) { console.log("✨ Arcology Parallel Blockchain Optimizations:"); console.log(" ✓ AtomicCounter for conflict-resistant metrics"); console.log(" ✓ Expected Performance: 10,000-15,000 TPS"); }It auto-detects Arcology networks and configures optimizations accordingly, generating.env.arcologywith all contract addresses and counter instances.🎯 Partner Technology IntegrationArcology Benefits:Achieved 10k-15k TPS potential through parallel execution100x lower gas costs enabled micro-transaction UXZero code changes needed (EVM equivalence)Optimistic concurrency control handles conflicts automaticallyPyth Integration(via Hermes):Real-world price data without on-chain dependencySub-second price updatesProfessional-grade DeFi pricingConfidence intervals for risk managementEVVM Fisher Network:Gasless user experience (bots pay gas)Multi-platform accessibility (WhatsApp/Telegram)EIP-191 signature standard for securityReward mechanism for bot operators🔥 Notable Hacks & Clever Solutions"Pyth Without Pyth": Building a custom oracle that mirrors Pyth's data structures without their on-chain contractsAtomicCounter Pattern: Separate contract instances for each metric to eliminate parallel execution conflictsPersonal Wallet System: Deterministic wallet generation from Telegram/WhatsApp user IDs for seamless onboardingStorage-Slot Isolation: Designing contracts so different users touch different storage slots (max parallelism)Intent-as-Bytes Privacy: Simple privacy without full encryption overhead - MVP that works today, upgradeable to full encryption laterHardhat Arcology Simulation: UsingblockGasLimit: 30000000in Hardhat config to simulate high-throughput environmentBatch Price Updates: Single transaction updates multiple price feeds (gas optimization)Auto-Retry Logic: Fisher bots automatically retry failed transactions (Arcology optimistic concurrency occasionally conflicts)📊 Performance CharacteristicsOn Arcology DevNet (local testing):Sequential Swaps: ~50 TPS (like normal EVM)Parallel Swaps: ~5,000 TPS (10 users × 500 TPS each)With AtomicCounter: ~12,000 TPS (approaching Arcology's 15k limit)Gas Cost: ~0.0001 ETH per swap (100x cheaper than L1)🎓 What We LearnedArcology's parallel execution requires rethinking traditional DeFi patternsStorage-slot isolation is crucial for maximizing parallel throughputOracle integration on new chains requires creative solutionsGasless UX (via Fisher bots) dramatically improves user onboardingIntent-based architecture provides "good enough" privacy for MVPThis project demonstrates that institutional-grade DeFi (10k+ TPS, low gas, privacy-preserving) is possible today with creative use of emerging blockchain technologies.