Splice

Short Description

Reference applications for funding, operating, and incentivizing the use of a decentralized, public Canton synchronizer. Includes the Amulet reference application for creating native payment utilities for Canton synchronizers and Daml applications.

Scope of Lab

Abstract

Splice is a set of reference applications designed to allow entities to operate, fund, and govern publicly available decentralized Canton synchronizers that provide connectivity and interoperability infrastructure for the Canton Network, as well as to provide bootstrapping rewards and incentives to early users of that service. The Canton Network is the set of all applications, built using the Daml blockchain application platform, that form shared blockchain state via the Canton Protocol.

Splice introduces a reference method for operating a publicly available decentralized Canton synchronizer. Each node in the decentralized synchronizer is operated by an entity known in Splice as a "Super Validator". Splice refers to a group of Super Validators actively operating nodes in a decentralized synchronizer at any point in time as the "decentralized synchronizer operator" (dso). The Splice code uses a code construct called a "decentralized synchronizer operator party" (dso party) to accumulate signatures from and take actions on behalf of the currently-active set of Super Validators.

Splice aims to help Super Validator operating groups create a transparent economic ecosystem that will, over time, fund operations of and extensions to multiple public synchronization services in the Canton Network.

Context

Daml is a platform built by Digital Asset designed for deploying blockchains and developing blockchain applications. It includes a smart contract language, a set of APIs for calling smart contract code, a transaction processing engine, a query-optimized database for accessing smart contract state, and development tooling including an SDK. The open source and enterprise distributions of Daml also include a blockchain protocol, Canton, that creates synchronized state among nodes running the Daml platform.

The Canton blockchain guarantees secure state synchronization between participant nodes by running a per-transaction consensus protocol using encrypted messages through a synchronization infrastructure called synchronizers (or sometimes synchronization domains). Synchronizers serve three functions:

• guaranteeing consistent message order and timestamps among stakeholders;

• guaranteeing delivery of messages to the stakeholders; and

• aggregating validation confirmations from stakeholders that the proposed transactions use valid inputs and produce valid outputs.

Together these allow ordered, two-phase atomic transaction processing, with confirmation of transaction validation and transaction commits. Canton does this while keeping data private to the stakeholders in each transaction.

Daml applications may choose any Canton synchronizer on a per-transaction basis to help them advance the shared blockchain state that forms on the participant nodes. The collection of all Daml applications that synchronize their state via the Canton protocol, and the set of Canton synchronizers they use to do this, together form the Canton Network.

Operating groups may charge a fee for traffic that uses their synchronizer. The fee may be metered in USD per megabyte, and levied via an on-chain payment utility. This utility is an implementation of the Splice reference application called Amulet.

The Amulet reference application specifies how to implement on-chain payments using “amulets” which represent the ability to pay an operating group to synchronize a transaction with a payload of a given size. Together with the full suite of Splice applications, amulets allow a group of entities to deploy, operate, fund, and govern a decentralized Canton synchronizer, and incentivize application developers and their customers to use that synchronizer to create blockchain state among their nodes. Each operating group configures an Amulet implementation to charge for use of the synchronizer, and distribute their own named version of amulets as rewards to incentivize early use of the service.

To provide a mapping between the value of its specific amulet and fiat currencies, the synchronizer operating group may use tooling included in Splice to jointly vote on a fee rate in megabytes per USD, and a nominal conversion rate between USD and the amulet configured by that operating group. This provides a base intrinsic value for the amulet used by the operating group: each amulet represents the value of creating and maintaining high guarantees of synchronized state across multiple computers, for a given data volume of messages shared among those computers. Should a market for that operating group’s amulet develop, the operating group may align the on-ledger price to the market price at its discretion. Synchronizer operating groups can incentivize use of their synchronizer by issuing their amulets to members of the operating group, to application providers, and to Canton participant node operators (“Validators”).

Daml applications may choose to use their own, privately operated, Canton synchronizer to create shared state across the Canton participant nodes interacting with those applications, or they may use any shared synchronizer offered by a third party operating group.

Dependent Projects

Splice has grown out of the Daml blockchain ecosystem and its Canton protocol. Open Source versions of Daml are maintained by Digital Asset under an Apache 2.0 License.

Splice expands on Daml’s privacy-preserving blockchain technology by providing governance, network bootstrapping and rewards mechanisms as well as payment solutions for any public, decentralized synchronizer built using the Daml blockchain platform. Splice uses the Daml smart contract language to represent the stakeholders and business operations involved in configuring and implementing amulets and the applications that use them. Splice repositories are designed to be deployed in conjunction with Canton synchronizers and participant nodes. Any organization that operates a Canton synchronizer uses the Daml platform in addition to the tooling and applications provided by Splice. This use of the Daml platform could include use of closed-source elements of Daml, at the operating group’s discretion.

Motivation

Splice aims to create a transparent economic ecosystem that will, over time, fund operations of and extensions to a public synchronization service. Success for Splice would mean that synchronization infrastructure becomes so widely available that any application will be able to use Daml to define a subset of state to be synchronized, distribute Daml code for generating that state to the computers to be synchronized, and use a synchronizer to coordinate creation of that shared state across any set of computers running Daml.

For a synchronization infrastructure to be this widely adopted, application developers need to know that they can trust it to operate in a transparent and predictable way, and at a better “price per value” point than comparable integration and synchronization technologies. Application developers and users also need reasons to try out the network before wide adoption creates strong network effects, so Splice includes a system of incentives and fees that reward early adopters.

Splice aims to make a high level of trust possible in the following ways:

• Make operations and governance of Canton synchronizers transparent and trackable through built-in governance tooling.

• Keep synchronizer transaction costs low via integrated payment, operations monitoring and governance automation, so operating groups can adjust their operations as needed to maintain a stable, long-term service offering.

• Manage these tools and applications via an Apache 2.0 license and an open source community within the Hyperledger Foundation.

Splice’s interlocking system of incentives and fees includes:

• Tools for using amulets as a payment utility, including a secure payment redirect feature that allows applications to call an amulet wallet to complete payments with strong security guarantees.

• Rewards denominated in amulets which strongly incentivize early providers of synchronization infrastructure, application providers who make solutions available in the early stages of the network, and Validator operators, who run blockchain nodes in the early stages of the network.

• Traffic acquisition tooling that allows users to purchase access to synchronization infrastructure using amulets.

• Handles for amulet users, to make it easy to find counterparties on chain and exchange amulets with them.

Status

The code that forms Splice was first implemented in June 2023 as part of a TestNet synchronizer operated by the members of an initial set of Super Validators. At that time Splice was a set of applications with various names including Canton Coin and Canton Name Service. The TestNet synchronizer has operated continuously since that time, with regular tests and software upgrades, using the code proposed for Splice to implement its operations, governance and payment applications. In late December 2023, Digital Asset and 46 separate financial institutions demonstrated 30 decentralized application deployments that synchronized roughly 350 financial transactions via the TestNet synchronizer.

The group of Super Validators operating this TestNet currently includes Digital Asset and three other organizations, with four additional organizations currently in the process of applying to join.

Digital Asset has funded an engineering team to develop the Splice reference applications. Digital Asset is working to build a team of collaborators who can decentralize responsibility for further development as part of the Open Source Software process.

Solution

Splice consists of:

• Daml models de