Mint, Transfer, and Trade User-Generated Tokens, All On-Chain

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We created the tokenvm to showcase how to use the hypersdk in an application most readers are already familiar with, token minting and token trading. The tokenvm lets anyone create any asset, mint more of their asset, modify the metadata of their asset (if they reveal some info), and burn their asset. Additionally, there is an embedded on-chain exchange that allows anyone to create orders and fill (partial) orders of anyone else. To make this example easy to play with, the tokenvm also bundles a powerful CLI tool and serves RPC requests for trades out of an in-memory order book it maintains by syncing blocks.

If you are interested in the intersection of exchanges and blockchains, it is definitely worth a read (the logic for filling orders is < 100 lines of code!).

Status

tokenvm is considered ALPHA software and is not safe to use in production. The framework is under active development and may change significantly over the coming months as its modules are optimized and audited.

Features

Arbitrary Token Minting

The basis of the tokenvm is the ability to create, mint, and transfer user-generated tokens with ease. When creating an asset, the owner is given "admin control" of the asset functions and can later mint more of an asset, update its metadata (during a reveal for example), or transfer/revoke ownership (if rotating their key or turning over to their community).

Assets are a native feature of the tokenvm and the storage engine is optimized specifically to support their efficient usage (each balance entry requires only 72 bytes of state = assetID|publicKey=>balance(uint64)). This storage format makes it possible to parallelize the execution of any transfers that don't touch the same accounts. This parallelism will take effect as soon as it is re-added upstream by the hypersdk (no action required in the tokenvm).

Trade Any 2 Tokens

What good are custom assets if you can't do anything with them? To showcase the raw power of the hypersdk, the tokenvm also provides support for fully on-chain trading. Anyone can create an "offer" with a rate/token they are willing to accept and anyone else can fill that "offer" if they find it interesting. The tokenvm also maintains an in-memory order book to serve over RPC for clients looking to interact with these orders.

Orders are a native feature of the tokenvm and the storage engine is optimized specifically to support their efficient usage (just like balances above). Each order requires only 152 bytes of state = orderID=>inAsset|inTick|outAsset|outTick|remaining|owner. This storage format also makes it possible to parallelize the execution of any fills that don't touch the same order (there may be hundreds or thousands of orders for the same pair, so this stil allows parallelization within a single pair unlike a pool-based trading mechanism like an AMM). This parallelism will take effect as soon as it is re-added upstream by the hypersdk (no action required in the tokenvm).

In-Memory Order Book

To make it easier for clients to interact with the tokenvm, it comes bundled with an in-memory order book that will listen for orders submitted on-chain for any specified list of pairs (or all if you prefer). Behind the scenes, this uses the hypersdk's support for feeding accepted transactions to any hypervm (where the tokenvm, in this case, uses the data to keep its in-memory record of order state up to date). The implementation of this is a simple max heap per pair where we arrange best on the best "rate" for a given asset (in/out).

Sandwich-Resistant

Because any fill must explicitly specify an order (it is up the client/CLI to implement a trading agent to perform a trade that may span multiple orders) to interact with, it is not possible for a bot to jump ahead of a transaction to negatively impact the price of your execution (all trades with an order occur at the same price). The worst they can do is to reduce the amount of tokens you may be able to trade with the order (as they may consume some of the remaining supply).

Not allowing the chain or block producer to have any control over what orders a transaction may fill is a core design decision of the tokenvm and is a big part of what makes its trading support so interesting/useful in a world where producers are willing to manipulate transactions for their gain.

Partial Fills and Fill Refunds

Anyone filling an order does not need to fill an entire order. Likewise, if you attempt to "overfill" an order the tokenvm will refund you any extra input that you did not use. This is CRITICAL to get right in a blockchain-context because someone may interact with an order just before you attempt to acquire any remaining tokens...it would not be acceptable for all the assets you pledged for the fill that weren't used to disappear.

Expiring Fills

Because of the format of hypersdk transactions, you can scope your fills to be valid only until a particular time. This enables you to go for orders as you see fit at the time and not have to worry about your fill sitting around until you explicitly cancel it/replace it.

Avalanche Warp Support

We take advantage of the Avalanche Warp Messaging (AWM) support provided by the hypersdk to enable any tokenvm to send assets to any other tokenvm without relying on a trusted relayer or bridge (just the validators of the tokenvm sending the message).

By default, a tokenvm will accept a message from another tokenvm if 80% of the stake weight of the source has signed it. Because each imported asset is given a unique AssetID (hash of sourceChainID + sourceAssetID), it is not possible for a malicious/rogue Subnet to corrupt token balances imported from other Subnets with this default import setting. tokenvms also track the amount of assets exported to all other tokenvms and ensure that more assets can't be brought back from a tokenvm than were exported to it (prevents infinite minting).

To limit "contagion" in the case of a tokenvm failure, we ONLY allow the export of natively minted assets to another tokenvm. This means you can transfer an asset between two tokenvms A and B but you can't export from tokenvm A to tokenvm B to tokenvm C. This ensures that the import policy for an external tokenvm is always transparent and is never inherited implicitly by the transfers between other tokenvms. The ability to impose this restriction (without massively driving up the cost of each transfer) is possible because AWM does not impose an additional overhead per Subnet connection (no "per connection" state to maintain). This means it is just as cheap/scalable to communicate with every other tokenvm as it is to only communicate with one.

Lastly, the tokenvm allows users to both tip relayers (whoever sends a transaction that imports their message) and to swap for another asset when their message is imported (so they can acquire fee-paying tokens right when they arrive).

You can see how this works by checking out the E2E test suite that runs through these flows.

Demos

Someone: "Seems cool but I need to see it to really get it." Me: "Look no further."

The first step to running these demos is to launch your own tokenvm Subnet. You can do so by running the following command from this location (may take a few minutes):

./scripts/run.sh;

By default, this allocates all funds on the network to token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp. The private key for this address is 0x323b1d8f4eed5f0da9da93071b034f2dce9d2d22692c172f3cb252a64ddfafd01b057de320297c29ad0c1f589ea216869cf1938d88c9fbd70d6748323dbf2fa7. For convenience, this key has is also stored at demo.pk.

If you don't need 2 Subnets for your testing, you can run MODE="run-single" ./scripts/run.sh.

To make it easy to interact with the tokenvm, we implemented the token-cli. Next, you'll need to build this. You can use the following command from this location to do so:

./scripts/build.sh

This command will put the compiled CLI in ./build/token-cli.

Lastly, you'll need to add the chains you created and the default key to the token-cli. You can use the following commands from this location to do so:

./build/token-cli key import demo.pk
./build/token-cli chain import-anr

chain import-anr connects to the Avalanche Network Runner server running in the background and pulls the URIs of all nodes tracking each chain you created.

Mint and Trade

Step 1: Create Your Asset

First up, let's create our own asset. You can do so by running the following command from this location:

./build/token-cli action create-asset

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
metadata (can be changed later): MarioCoin
continue (y/n): y
✅ txID: 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug

txID is the assetID of your new asset.

The "loaded address" here is the address of the default private key (demo.pk). We use this key to authenticate all interactions with the tokenvm.

Step 2: Mint Your Asset

After we've created our own asset, we can now mint some of it. You can do so by running the following command from this location:

./build/token-cli action mint-asset

When you are done, the output should look something like this (usually easiest just to mint to yourself).

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
assetID: 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
metadata: MarioCoin supply: 0
recipient: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
amount: 10000
continue (y/n): y
✅ txID: X1E5CVFgFFgniFyWcj5wweGg66TyzjK2bMWWTzFwJcwFYkF72

Step 3: View Your Balance

Now, let's check that the mint worked right by checking our balance. You can do so by running the following command from this location:

./build/token-cli key balance

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
assetID (use TKN for native token): 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
metadata: MarioCoin supply: 10000 warp: false
balance: 10000 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug

Step 4: Create an Order

So, we have some of our token (MarioCoin)...now what? Let's put an order on-chain that will allow someone to trade the native token (TKN) for some. You can do so by running the following command from this location:

./build/token-cli action create-order

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
in assetID (use TKN for native token): TKN
✔ in tick: 1█
out assetID (use TKN for native token): 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
metadata: MarioCoin supply: 10000 warp: false
balance: 10000 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
out tick: 10
supply (must be multiple of out tick): 100
continue (y/n): y
✅ txID: 2TdeT2ZsQtJhbWJuhLZ3eexuCY4UP6W7q5ZiAHMYtVfSSp1ids

txID is the orderID of your new order.

The "in tick" is how much of the "in assetID" that someone must trade to get "out tick" of the "out assetID". Any fill of this order must send a multiple of "in tick" to be considered valid (this avoid ANY sort of precision issues with computing decimal rates on-chain).

Step 5: Fill Part of the Order

Now that we have an order on-chain, let's fill it! You can do so by running the following command from this location:

./build/token-cli action fill-order

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
in assetID (use TKN for native token): TKN
balance: 997.999993843 TKN
out assetID (use TKN for native token): 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
metadata: MarioCoin supply: 10000 warp: false
available orders: 1
0) Rate(in/out): 100000000.0000 InTick: 1.000000000 TKN OutTick: 10 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug Remaining: 100 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
select order: 0
value (must be multiple of in tick): 2
in: 2.000000000 TKN out: 20 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
continue (y/n): y
✅ txID: uw9YrZcs4QQTEBSR3guVnzQTFyKKm5QFGVTvuGyntSTrx3aGm

Note how all available orders for this pair are listed by the CLI (these come from the in-memory order book maintained by the tokenvm).

Step 6: Close Order

Let's say we now changed our mind and no longer want to allow others to fill our order. You can cancel it by running the following command from this location:

./build/token-cli action close-order

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
orderID: 2TdeT2ZsQtJhbWJuhLZ3eexuCY4UP6W7q5ZiAHMYtVfSSp1ids
out assetID (use TKN for native token): 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug
continue (y/n): y
✅ txID: poGnxYiLZAruurNjugTPfN1JjwSZzGZdZnBEezp5HB98PhKcn

Any funds that were locked up in the order will be returned to the creator's account.

Bonus: Watch Activity in Real-Time

To provide a better sense of what is actually happening on-chain, the index-cli comes bundled with a simple explorer that logs all blocks/txs that occur on-chain. You can run this utility by running the following command from this location:

./build/token-cli chain watch

If you run it correctly, you'll see the following input (will run until the network shuts down or you exit):

database: .token-cli
available chains: 2 excluded: []
0) chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
1) chainID: cKVefMmNPSKmLoshR15Fzxmx52Y5yUSPqWiJsNFUg1WgNQVMX
select chainID: 0
watching for new blocks on Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9 👀
height:13 txs:1 units:488 root:2po1n8rqdpNuwpMGndqC2hjt6Xa3cUDsjEpm7D6u9kJRFEPmdL avg TPS:0.026082
✅ 2Qb172jGBtjTTLhrzYD8ZLatjg6FFmbiFSP6CBq2Xy4aBV2WxL actor: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp units: 488 summary (*actions.CreateOrder): [1.000000000 TKN -> 10 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug (supply: 50 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug)]
height:14 txs:1 units:1536 root:2vqraWhyd98zVk2ALMmbHPApXjjvHpxh4K4u1QhSb6i3w4VZxM avg TPS:0.030317
✅ 2H7wiE5MyM4JfRgoXPVP1GkrrhoSXL25iDPJ1wEiWRXkEL1CWz actor: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp units: 1536 summary (*actions.FillOrder): [2.000000000 TKN -> 20 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug (remaining: 30 27grFs9vE2YP9kwLM5hQJGLDvqEY9ii71zzdoRHNGC4Appavug)]
height:15 txs:1 units:464 root:u2FyTtup4gwPfEFybMNTgL2svvSnajfGH4QKqiJ9vpZBSvx7q avg TPS:0.036967
✅ Lsad3MZ8i5V5hrGcRxXsghV5G1o1a9XStHY3bYmg7ha7W511e actor: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp units: 464 summary (*actions.CloseOrder): [orderID: 2Qb172jGBtjTTLhrzYD8ZLatjg6FFmbiFSP6CBq2Xy4aBV2WxL]

Transfer Assets to Another Subnet

Unlike the mint and trade demo, the AWM demo only requires running a single command. You can kick off a transfer between the 2 Subnets you created by running the following command from this location:

./build/token-cli action export

When you are done, the output should look something like this:

database: .token-cli
address: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
chainID: Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9
✔ assetID (use TKN for native token): TKN
balance: 997.999988891 TKN
recipient: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp
amount: 10
reward: 0
available chains: 1 excluded: [Em2pZtHr7rDCzii43an2bBi1M2mTFyLN33QP1Xfjy7BcWtaH9]
0) chainID: cKVefMmNPSKmLoshR15Fzxmx52Y5yUSPqWiJsNFUg1WgNQVMX
destination: 0
swap on import (y/n): n
continue (y/n): y
✅ txID: 24Y2zR2qEQZSmyaG1BCqpZZaWMDVDtimGDYFsEkpCcWYH4dUfJ
perform import on destination (y/n): y
22u9zvTa8cRX7nork3koubETsKDn43ydaVEZZWMGcTDerucq4b to: token1rvzhmceq997zntgvravfagsks6w0ryud3rylh4cdvayry0dl97nsjzf3yp source assetID: TKN output assetID: 2rST7KDPjRvDxypr6Q4SwfAwdApLwKXuukrSc42jA3dQDgo7jx value: 10000000000 reward: 10000000000 return: false
✔ switch default chain to destination (y/n): y

The export command will automatically run the import command on the destination. If you wish to import the AWM message using a separate account, you can run the import command after changing your key.

Running a Load Test

Before running this demo, make sure to stop the network you started using killall avalanche-network-runner.

The tokenvm load test will provision 5 tokenvms and process 500k transfers on each between 10k different accounts.

./scripts/tests.load.sh

This test SOLELY tests the speed of the tokenvm. It does not include any network delay or consensus overhead. It just tests the underlying performance of the hypersdk and the storage engine used (in this case MerkleDB on top of Pebble).

Measuring Disk Speed

This test is extremely sensitive to disk performance. When reporting any TPS results, please include the output of:

./scripts/tests.disk.sh

Run this test RARELY. It writes/reads many GBs from your disk and can fry an SSD if you run it too often. We run this in CI to standardize the result of all load tests.

Zipkin Tracing

To trace the performance of tokenvm during load testing, we use OpenTelemetry + Zipkin.

To get started, startup the Zipkin backend and ElasticSearch database (inside hypersdk/trace):

docker-compose -f trace/zipkin.yml up

Once Zipkin is running, you can visit it at http://localhost:9411.

Next, startup the load tester (it will automatically send traces to Zipkin):

TRACE=true ./scripts/tests.load.sh

When you are done, you can tear everything down by running the following command:

docker-compose -f trace/zipkin.yml down

Deploying to a Devnet

In the world of Avalanche, we refer to short-lived, test Subnets as Devnets.

To programaticaly deploy tokenvm to a distributed cluster of nodes running on your own custom network or on Fuji, check out this doc.

Future Work

If you want to take the lead on any of these items, please start a discussion or reach out on the Avalanche Discord.

• Add more config options for determining which order books to store in-memory
• Add option to CLI to fill up to some amount of an asset as long as it is under some exchange rate (trading agent command to provide better UX)
• Add expiring order support (can't fill an order after some point in time but still need to explicitly close it to get your funds back -> async cleanup is not a good idea)
• Add lockup fee for creating a Warp Message and ability to reclaim the lockup with a refund action (this will allow for "user-driven" acks on messages, which will remain signable and in state until a refund action is issued)