From 15589d3fa8e603864bf3614674899fd8888900c4 Mon Sep 17 00:00:00 2001
From: ben-chain <ben@pseudonym.party>
Date: Sat, 1 Jun 2019 17:56:11 -0400
Subject: [PATCH] add transaction predicate spec

---
 .../transaction-based-predicate.rst           | 76 +++++++++++++++++++
 1 file changed, 76 insertions(+)
 create mode 100644 packages/docs/src/spec/src/02-contracts/transaction-based-predicate.rst

diff --git a/packages/docs/src/spec/src/02-contracts/transaction-based-predicate.rst b/packages/docs/src/spec/src/02-contracts/transaction-based-predicate.rst
new file mode 100644
index 00000000..4d9a66a7
--- /dev/null
+++ b/packages/docs/src/spec/src/02-contracts/transaction-based-predicate.rst
@@ -0,0 +1,76 @@
+####################################
+Transaction-based Predicate Standard
+####################################
+
+***********
+Description
+***********
+
+Most developers are more familiar with a transaction-based model of cryptocurrencies, where state transitions as the result of transactions form the basis for computation. Our client and operator implementations also work this way--it's really a great model!  The transaction-based predicate standard helps us to do this cleanly, by providing a wrapper which interprets transactions in the context of deprecation and disputes.
+
+In essence, the way to enable this is: if a transaction from one state has been authenticated (e.g. signed by its single owner or signed by the multiple participants of a multisig), it must be deprecable using that transaction.
+
+*********************
+Transaction Execution
+*********************
+
+verifyTransaction
+-----------------
+
+.. code-block:: solidity
+
+   function verifyTransaction(
+       StateUpdate _preState,
+       Transaction _transaction,
+       bytes _witness,
+       StateUpdate _postState
+   ) public
+
+Description
+^^^^^^^^^^^
+The main thing that must be defined for a state transition model is this ``verifyTransaction`` function which accepts a ``preState`` state update, and verifies against a ``transaction`` and ``witness`` that a given ``postState`` is correct.
+
+Parameters
+^^^^^^^^^^
+1. ``_preState`` - ``StateUpdate``: the state update which the transaction is being applied on.
+2. ``_transaction`` - ``Transaction``: The transaction being applied.  Follows the standard format as outlined in the transaction generation page in Secion #03.
+3. ``_witness`` - ``bytes``: Additional witness data which authenticates the transaction validity, e.g. a signature. Defined on a per-predicate basis.
+4. ``_postState`` - ``StateUpdate``: the output of the transaction to be verified.
+
+Requirements
+^^^^^^^^^^^^
+- Predicates **MUST** define a custom ``_witness`` struct for their particular type of state.
+- Predicates **MUST** disallow state transitions which pass verification without some interested party's consent, e.g. the owner's signature
+
+***********
+Deprecation
+***********
+
+proveDeprecation
+----------------
+
+.. code-block:: solidity
+
+   function proveExitDeprecation(
+       Checkpoint _deprecatedExit,
+       Transaction _transaction,
+       bytes _witness,
+       StateUpdate _postState
+   ) public
+
+Description
+^^^^^^^^^^^
+If a state transition away from a given state update exists, then it is not valid to exit that state--it should be deprecated!  This function allows a user to demonstrate this to the predicate so that it may cancel an exit
+
+Parameters
+^^^^^^^^^^
+1. ``_deprecatedExit`` - ``Checkpoint``: the deprecated checkpoint being exited.
+2. ``_transaction`` - ``Transaction``: The transaction which deprecates the exit.  Follows the standard format as outlined in the transaction generation page in Secion #03.
+3. ``_witness`` - ``bytes``: Additional witness data which authenticates the transaction validity, e.g. a signature. Defined on a per-predicate basis.
+4. ``_postState`` - ``StateUpdate``: the output of the transaction to be verified.
+
+Requirements
+^^^^^^^^^^^^
+- **MUST** check that the transaction is valid with a call to ``verifyTransaction(_deprecatedExit.stateUpdate, _transaction, _witness, _postState``.
+- **MUST** check that the ``_postState.range`` intersects the ``_deprecatedExit.subrange``
+- **MUST** call ``deprecateExit(_deprecatedExit)`` on the ``_deprecatedExit.stateUpdate.state.predicateAddress``.