Laxo

Laxo is a prediction market platform for forex currencies, built for EthGlobal's 2026 HackMoney hackathon. It lets users bet on currency movements (long/short) with instant, gas-free transactions.

The idea is the following: Laxo offers a hub with three things for users to do: prediction market on foreign exchange (FOREX) rates, ability to split USDC holdings across foreign stablecoin backed currencies and a view of what their wallet has.

Users take positions on whether a currency pair will be above or below a target price by a resolution time. Winners claim payouts from losers, similar to traditional prediction markets, but optimized for forex.

Laxo leverages the following -

1. Smart Contracts (Solidity 0.8.24) Hardhat for development, testing, and deployment OpenZeppelin for security patterns (Ownable, ReentrancyGuard, SafeERC20) Ethers.js v6 for contract interactions Deployed on Sepolia testnet and Arc Network testnet Frontend (Next.js 16 + React 18) App Router with Server Components Wagmi v3 + Viem v2 for Ethereum interactions Tailwind CSS for styling React Query for state management Partner Technology Integrations
2. Yellow Network (ERC-7824 Nitrolite Protocol) Uses @erc7824/nitrolite for state channel sessions Custom WebSocket client (yellowClient.js) connecting to wss://clearnet-sandbox.yellow.com/ws Session-based architecture: each prediction market gets its own Yellow session Off-chain position tracking: positions stored in YellowSession.positions Map, synchronized via WebSocket messages On-chain settlement bridge: YellowIntegration.sol records off-chain positions and finalizes settlements on-chain Test wallet system: localStorage-backed test wallet with deterministic address generation for development (no real funds needed)
3. Circle Gateway & Wallets Circle Gateway API client (gateway.js) for cross-chain USDC transfers Supports 7 chains: Ethereum, Base, Polygon, Avalanche, Arbitrum, Optimism, Arc Unified balance queries across chains via Circle's /balances endpoint Arc Network integration: USDC-native gas (gasPrice: 0 in Hardhat config) Transfer attestation flow: estimate fees → create attestation → execute cross-chain transfer
4. ENS Integration Viem-based ENS resolver using mainnet public client (ENS doesn't exist on Sepolia) Deterministic pie wallet generation: hash-based address generation from userAddress + pieId Local-first ENS tracking: stores ENS names in localStorage, resolves on-chain when available Format: pie-{shortId}.{userShortAddress}.eth for human-readable portfolio addresses Notable Implementation Details
5. Hybrid Off-Chain/On-Chain Architecture Positions taken instantly off-chain via Yellow SDK (zero gas) Settlement recorded on-chain via YellowIntegration.recordOffChainPosition() Market resolution happens on-chain via PredictionMarket.resolveMarket() Winners claim payouts on-chain, bridging off-chain positions to on-chain settlements
6. Test Wallet System Generates deterministic test addresses using simple hash function (not cryptographically secure, but sufficient for demos) Caches wallet state in localStorage (laxo_test_wallet) Mock signature generation for Yellow Network messages Balance tracking with BigInt precision for USDC (6 decimals)
7. Blockchain Logging System Custom BlockchainClient wraps Viem's public client Logs all transactions, events, and connection status In-memory log buffer (last 100 entries) with event emitter pattern Graceful degradation: app continues even if blockchain connection fails
8. Deployment Automation Single script (deploy.js) deploys all contracts and creates 10 markets in one transaction Extracts market addresses from event logs (handles both parsed and raw logs) Auto-verification on Etherscan with 30-second delay for block confirmations Saves deployment artifacts to deployments/ directory with timestamps
9. State Channel Session Management Each market gets its own YellowSession instance Session IDs generated from appDefinition.nonce (timestamp-based) Position updates sent as custom WebSocket messages (position_update type) Balance synchronization via payment and sessionMessage event handlers
10. Multi-Chain Configuration Hardhat config supports Sepolia and Arc testnet Arc uses USDC as native gas (gasPrice: 0) Environment-based RPC URL selection with fallbacks to public endpoints PublicNode fallback when Infura/Alchemy keys aren't provided How Everything Pieces Together User connects wallet → Wagmi handles MetaMask connection User initializes Yellow Network → YellowClient creates WebSocket connection to ClearNode User selects market → YellowSession creates app session with market address as partner User takes position → Off-chain message sent via Yellow SDK, tracked locally in positions Map Position recorded → Frontend calls YellowIntegration.recordOffChainPosition() to store on-chain reference Market resolves → Oracle provides price, PredictionMarket.resolveMarket() calculates winners Settlement → Winners call finalizeSettlement() to bridge off-chain position to on-chain payout Cross-chain → Circle Gateway transfers USDC to Arc for USDC-native gas operations