STP.09: Add Support for the Flare Data Connector

Type Songbird Test Proposal
Author Flare Foundation
Created 16-October-2024
Document Status Draft
Threshold Condition 75% (required to reject)
Majority Condition 50% (required to reject)

1. Brief Description

This proposal introduces the Flare Data Connector (FDC), a protocol that will allow applications to securely import external events onto the Flare networks. The introduction of the FDC will strengthen Flare’s position as the blockchain for data. The goals of the proposal are to:

  • Introduce the FDC protocol as an evolution and replacement of the State Connector.
  • Add the FDC protocol contracts to the Songbird network.
  • Assign part of the network’s yearly inflation to rewarding the FDC protocol to incentivise provider participation.
  • In its initial deployment, the FDC protocol will include support for attestation types required for the FAsset system, as well as EVM Transaction types.

The rewarding structure, minimum participation requirements, and implementation details are described in the next section. The FDC protocol is also described in more technical terms in the whitepaper.

2. Technical Description

The goal of the FDC is to improve the range of available data in a trustless manner - trust will be derived from the underlying security assumptions of the Flare (or in this case, Songbird) network. To this end, the FDC is a request based system that allows users to request attestations of external data be published on the Flare networks. This process is secured by Flare’s data providers, so that when the user requires this data for e.g. a smart contract, interested parties can trust that the data is genuine.

The introduction of the FDC is needed on Flare to facilitate importing external data on to the network, solving two key problems:

  • Trusting the data - the FDC is secured by Flare’s providers, and thus can be trusted within the setting of the Flare (or Songbird) network.
  • Filtering for useful data - the FDC is request based, so only data that is desired by a user is attested to, rather than wasteful monitoring or importing of all data from given sources.

The FDC protocol runs in voting epochs, synced with the FTSOv2 protocol. Each round of the FDC is roughly split into:

  • Collect phase: the period during which users submit requests for the round. Note that a new collect phase starts immediately after the previous round’s collect phase ends, ensuring that requests can be sent at all times.
  • Choose phase: during this period the data providers collate the requests and determine which ones can be confirmed in the current round.
  • Resolution phase: the set of confirmed attestation requests is published on-chain as a Merkle root, if enough data providers support the outcome.

The events contained in a published Merkle root are then considered true according to consensus on the network.

2.1 Attestation Types

In order to be correctly handled by the FDC, each attestation request must conform to one of the predefined attestation types, which define the data source and response method for requests of the chosen type. Well-defined response methods must specify the type of information that is sufficient to prove the veracity of the attested event, which will be included in the attestation response.

To begin with, the attestation types that will be supported by the FDC are chosen in preparation for the FAsset system, namely:

  • AddressValidity: verify the validity of an address format on an external chain.
  • BalanceDecreasingTransaction: verify a transaction that either decreases the balance of a given address, or is signed by the source address. This attestation could prove a violation of an agreement.
  • ConfirmedBlockHeightExists: an assertion that a given block at specified height is confirmed on a specified chain.
  • Payment: a relay of a transaction on an external chain that is considered a payment in a native currency.
  • ReferencedPaymentNonexistence: an assertion that an agreed-upon payment has not been made by a certain deadline.
  • EVMTransaction: a relay of a transaction from an EVM chain together with a part of its receipt.

The EVMTransaction attestation type will support ETH, FLR, and SGB source chains, while the remaining attestation types will be supported on BTC, DOGE, and XRP.

2.1.1 Process to Add new Attestation Types

The community can propose new attestation types, which would be accepted if they gain the support of the majority of the data providers. The process is as follows:

  1. A request to include a new attestation type can be made on Flare’s Discord server, in the Discuss-Ideas developer channel, which should include:
    1. A set of rules that precisely define the new attestation type.
    2. Motivation and potential software requirements (verifier server).
    3. A proposal for the base fee of such attestation requests.
  2. The Flare Foundation will forward the request to the Management Group’s forum and request a vote.
  3. If the majority of data providers support the new type and the base fee, the requested attestation type will be added to the system.

A more formal process for adding new attestation types will be introduced in a future proposal.

2.2 Rewarding Structure

FDC rewards will be provided for voting on and attesting to requests, with providers being rewarded relative to their total active weight. Rewards for the FDC will come from two sources. The first of those is the network’s yearly inflation, previously used to reward data providers for their participation in the FTSO protocol. This will be modified in the following manner:

Protocol Proposed Inflationary Share
FTSOv2 50%
FDC 50%

The secondary source of rewards comes directly from the users of the FDC protocol. Each attestation request has an individual reward offer provided by the users in the form of a fee. Requests with higher fees will be prioritized by the system, being thus more likely to be attested by the data providers. These fees will be distributed among the data providers that responded to the requests.

2.3 Minimal Requirements

In line with SIP.04, the FDC protocol will introduce certain minimal participation requirements for the data providers. If these requirements are not met in a given reward epoch, data providers may not be eligible for rewards in any of the network protocols, as described in the SIP.04 proposal.

Successful participation in a voting round requires getting rewards for that round (participating in correct Merkle root voting). Initially, the minimal requirements for a reward epoch will be defined as:

  • Successful participation in 60% of all voting rounds in that reward epoch.

This percentage will gradually increase in the following months up to 80%, unless the requirement is deemed too restrictive.

2.4 Wider Ecosystem Implications

The FDC protocol offers a versatile framework for applications that require external data from both on-chain and off-chain sources, with far reaching implications for the Flare ecosystem. The FDC protocol will be a key part of the FAssets system, which will allow non-smart contract tokens to be used trustlessly with smart contracts within the Flare networks.

The FDC protocol recently demonstrated its capabilities in a prediction market dApp for verifying real-world events during the 2024 Summer Olympics. Note that while the necessary attestation type for this type of applications will not be initially supported, they could be added in the future as previously described.

2.5 Deployment Strategy

Enabling the FDC protocol does not require a hard fork of the network. Instead, the new contracts listed in the next section will be deployed, and the inflation allocation updated as previously described.

During the 90 days following the deployment, the Flare Foundation may change some of the system’s parameters to fine-tune it.

4. Proposed Implementation Date Range

Implementation is expected to start shortly after the voting finishes. The exact date will be announced in time for FTSO data providers to prepare.

5. Voting Details

An STP is rejection-based, meaning that it is accepted unless certain conditions are met, namely, that the quorum threshold (75%) is reached and at least half of the votes are against it. (See Governance.)

Before voting, data providers should be aware that due to the minimal requirements imposed above, as per SIP.04, they will have to handle more tasks as part of their duties on Songbird. In particular, the FDC requires verification infrastructure (such as, but not limited to, nodes on external chains) not explicitly required in the past. Nevertheless, the additional FDC rewarding mechanism is expected to cover these infrastructure costs.

6. Deadline for Voting

  • Notice period: 17-October-2024 to 23-October-2024
  • Voting period: 24-October-2024 to 30-October-2024