Ztomic-Swap

Ztomic Swap: Detailed Protocol DescriptionThe Ztomic Swap is a complete trustless, privacy-preserving atomic swap protocol built on the Ethereum blockchain. It functions as a shielded exchange mechanism that fully conceals trader identity, asset flows, and transaction amounts.Core Problem and SolutionThe primary purpose of the Ztomic Swap is to solve the public traceability problem of traditional on-chain atomic swaps (HTLCs). While traditional swaps are atomic, they reveal the full transaction graph, linking the public addresses to the assets they exchange. Ztomic Swap's Solution: It breaks this link by integrating two core cryptographic concepts: Shielded Pools (Zero-Knowledge) for privacy and the Hashlock Mechanism (Atomic Swaps) to maintain the critical "all-or-nothing" execution guarantee.Protocol Components and ExecutionThe protocol is organized around commitments, ZK circuits, and the underlying infrastructure.1. Commitments (The Swaps)A swap begins with two parties, Alice and Bob, creating matching, but secret, orders. Both the Alice Commitment and the Bob Commitment are cryptographic hashes representing their respective deposits and desired outcomes. The hash is generated using Poseidon2 Hashing over several secret inputs, including the token type, amount, a Nonce (for uniqueness), and the Hashlock (the shared secret hash). Bob then creates a Symmetric Commitment from Bob using the same Hashlock as Alice, cryptographically linking their two private orders.2. Circuits and Proofs (ZK Contingent Execution)Execution is handled by two distinct Zero-Knowledge circuits that cryptographically enforce the rules and atomicity of the swap. This is the mechanism for Zk contingent payments and Zk contingent swaps.Circuit A (Alice's Withdrawal): Alice, the first party, uses her Circuit A to withdraw her target asset. The process involves Proving the Circuit A (Revealing Nonce), where Alice generates a ZK-Proof that validates her ownership and her knowledge of the Hashlock preimage (the secret). This proof is submitted to the Circuit A verifier contract, and its successful execution reveals the secret on-chain.Circuit B (Bob's Withdrawal): Bob uses the secret (revealed by Alice's proof) to generate his ZK-Proof via Circuit B. This process, Proving the Circuits B (Using Revealed Nonce), validates his own ownership and knowledge of the now-public secret. This proof is submitted to the Circuit B verifier contract to complete the atomic swap.3. Infrastructure and Data StructuresThe protocol relies on robust cryptographic data structures for state and verification.Merkle Tree Data Structure: This structure stores all user deposits as leaves. The single hash at the top, the Merkle Root, summarizes the entire state. The protocol uses an Incremental Merkle Tree (IMT) pattern to handle frequent deposits. The $O(\log N)$ hash updates are performed off-chain to minimize gas costs and accelerate on-chain execution. The smart contract only updates the single stored Merkle Root variable, achieving significant efficiency.Merkel Root State Sharing: The Merkle root is the single, crucial piece of shared state. This state management is essential for future Cross-chain privacy swap functionality, enabling the secure relay of state between different chains.Nullifier Hashes (for nullifying commitments): A unique, cryptographically derived hash generated when a commitment is spent. The contract checks to ensure the nullifier has not been recorded previously, which prevents double-spending of a commitment.Token Pairs (zUSDC, zUSDT): These are the shielded representations of the assets exchanged within the private pool.Public keys and private keys (baby jubjub): The system uses Baby JubJub curve cryptography for key generation, providing the underlying asymmetric security for managing and spending private commitments.The culmination of these components is the Ztomic Contract, a fully trustless, atomic, and private exchange platform.

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Ztomic Swap: Complete Protocol Description The Ztomic Swap is a cutting-edge, privacy-preserving atomic swap protocol designed to bring confidential asset exchange to the blockchain ecosystem. It achieves trustless, all-or-nothing execution by integrating the Shielded Pool concept (inspired by Zcash) with the classic Hashlock mechanism, all enforced by Zero-Knowledge Proofs (ZK-Proofs).

Core Problem and Solution The primary purpose of the Ztomic Swap is to solve the public traceability problem of traditional on-chain atomic swaps (HTLCs) by preventing the on-chain linking of user addresses and trading data.

Ztomic Swap's Solution: It breaks this link by integrating two core cryptographic concepts: Shielded Pools (Zero-Knowledge) for privacy and the Hashlock Mechanism (Atomic Swaps) to maintain the critical "all-or-nothing" execution guarantee.

Protocol Components and Execution The protocol is organized around commitments, ZK circuits, and the underlying infrastructure.

1. Commitments (The Swaps) A swap begins with two parties, Alice and Bob, creating matching, but secret, orders. Both the Alice Commitment and the Bob Commitment are cryptographic hashes representing their respective deposits and desired outcomes. The hash is generated using Poseidon2 Hashing over several secret inputs, including the token type, amount, a Nonce (for uniqueness), and the Hashlock (the shared secret hash). Bob then creates a Symmetric Commitment from Bob using the same Hashlock as Alice, cryptographically linking their two private orders.

2. Circuits and Proofs (ZK Contingent Execution) Execution is handled by two distinct Zero-Knowledge circuits that cryptographically enforce the rules and atomicity of the swap. This is the mechanism for Zk contingent payments and Zk contingent swaps.

Circuit A (Alice's Withdrawal): Alice, the first party, uses her Circuit A to withdraw her target asset. The process involves Proving the Circuit A (Revealing Nonce), where Alice generates a ZK-Proof that validates her ownership and her knowledge of the Hashlock preimage (the secret). This proof is submitted to the Circuit A verifier contract, and its successful execution reveals the secret on-chain.

Circuit B (Bob's Withdrawal): Bob uses the secret (revealed by Alice's proof) to generate his ZK-Proof via Circuit B. This process, Proving the Circuits B (Using Revealed Nonce), validates his own ownership and knowledge of the now-public secret. This proof is submitted to the Circuit B verifier contract to complete the atomic swap.

1. Infrastructure and Data Structures The protocol relies on robust cryptographic data structures to maintain state and enable rapid verification.

Merkle Tree Data Structure: This structure stores all user deposits as leaves. The single hash at the top, the Merkle Root, summarizes the entire state. The protocol uses an Incremental Merkle Tree (IMT) pattern to handle frequent deposits by performing costly updates off-chain, ensuring low gas fees.

Merkel Root State Sharing: The Merkle root is the single piece of shared state that the on-chain verifier needs to know. This state management is essential for future Cross-chain privacy swap functionality, enabling the secure relay of state between different chains.

Nullifier Hashes: A unique, cryptographically derived hash generated when a commitment is spent. The contract checks to ensure the nullifier has not been recorded previously, which prevents double-spending of a commitment.

Token Pairs (zUSDC, zUSDT): These are the shielded versions of the assets exchanged within the private pool.

Public keys and private keys (baby jubjub): The system uses Baby JubJub curve cryptography for key generation, providing the underlying asymmetric security for managing and spending commitments.

Ztomic Naming System and Cryptography The Ztomic Naming System provides a private identity for each user, derived from their Baby JubJub private keys. This identity is used internally within ZK-Proofs to link the user to their commitments without revealing a public address. The system relies on Baby JubJub curve cryptography, where the Public Keys (pubKeyX, pubKeyY) are stored on-chain to allow the verifier contract to confirm that a ZK-Proof was authorized by the corresponding private key holder.

Ztomic Contract and Infrastructure The Ztomic Contract is the primary on-chain authority, managing the Shielded Pool, recording the current Merkle Root, and tracking all spent Nullifier Hashes. All transactions are executed using the highly efficient Poseidon2Hasher cryptographic primitive.

The Ztomic-Swap Server acts as the crucial off-chain intent management backend. It handles the coordination workflow where an initiator (Alice) posts an Intent, interested parties (Bob) respond, and Alice selects a final counterparty, signaling the client-side app to begin ZK-Proof generation for the on-chain swap execution.