Unexpected Relay Costs Accounting - Stealth Addresses

Changes in token amounts are pre-determined in proof-generation time before a transaction is submitted.

As a consequence, there is a risk of the following unexpected payoffs regarding:

• Slippage

• Gas costs

• Smart-contract parameter change affecting payoffs (e.g. CRV emission rate)

To tackle this risk, the unexpected payoffs are compensated to the user using stealth addresses generated before the transaction is submitted.

Stealth addresses conceal the recipient's identity even when transaction data is created on-chain. For a transaction, either the recipient or the sender can generate a stealth address, but only the recipient can control it. The recipient creates a secret spending key to form a stealth meta-address shared with the sender. The sender then uses it to generate a stealth address for the recipient to receive assets. This system provides a confidentiality-preserving approach, similar to generating unique addresses for every transaction.

Hinkal uses this system to return to the user any difference between the expected slippage the user covered prior to the transaction and the actual costs when the transaction is completed on-chain.

Stealth addresses are generated before the transaction swap is submitted. This enables the protocol to execute the transaction, cover the transaction costs, and send back to shielded addresses any overhead slippage, while at the same time preserving the user’s anonymity.