Ethereal

Ethereal is a Match-3 game that demonstrates how blockchain infrastructure can be abstracted away from the user. It leverages Yellow Network for speed, Arc & Circle for liquidity, and ENS for identity.

This project utilizes Yellow Network's state channels to execute gameplay off-chain. This allows for instant, gasless moves where each interaction is cryptographically signed. Updates are settled on-chain only when the session concludes.

The architecture positions Arc as a liquidity hub. By integrating Circle's Cross-Chain Transfer Protocol (CCTP), the application enables users to deposit USDC from supported chains (Arbitrum, Optimism, Sepolia) into the game environment.

For execution, the game operates on Base Sepolia, where the Yellow Network contracts are deployed. This layer functions as the settlement environment for the state channels. Identity is managed through ENS, replacing hexadecimal addresses with human-readable names.

Ethereal is a Next.js 16 application built with React 19 and TailwindCSS v4.

State Channels (Yellow Network): The application implements the Yellow Nitrolite SDK (@erc7824/nitrolite) to manage state channels. Upon session initialization, a channel opens between the user's wallet and the "House" node. Each gameplay move triggers a signed state update off-chain, incrementing a nonce and updating the balance allocation. A local key-signing strategy eliminates the need for repeated wallet popups after the initial session signature.

Execution & Settlement (Base Sepolia): The application relies on Base Sepolia for final settlement. It interacts with the Yellow Network Adjudicator and Custody contracts deployed on this chain to lock funds and verify the final state.

Liquidity & Interoperability (Arc & Circle): The project integrates Circle's CCTP via a custom useGateway hook. This allows the application to detect USDC balances across multiple testnets and facilitate transfers to the Arc chain or Base Sepolia, creating a unified liquidity layer.

Identity (ENS): Frontend components utilize wagmi hooks to resolve and display ENS names and avatars.