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21. Bounded transaction validity on Hydra protocol transactions

· 3 min read
Sebastian Nagel
Pascal Grange
Franco Testagrossa
Arnaud Bailly
Sasha Bogicevic




  • The HydraHeadV1 formal specification contains a bounded confirmation window:

    // Deadline

    T_max <= T_min + L // Bounded confirmation window
    DL’ = T_max + L // The latest possible deadline is 2*L

    with T_min and T_max being the tx validity bounds and L being the contestation period.

    • This is to avoid attacks with specified upper validity bound being too far in the future and denial of service the head with this (e.g. 10 years).

Current state of things:

  • The contestation period and upper tx validity is used for computing the contestation deadline.

  • There is a closeGraceTime currently hard-coded (to 100 slots) to set some upper bound on the closeTx. This was also required so far to compute the contestation deadline.

  • Different networks (chains) have different slot lenghts, e.g. the preview network has a slot every 1s, while our local devnets use 0.1s. This means hardcoded values like closeGraceTime need to be in sync with the underlying network.

  • The contestationPeriod can be configured by users via the Init client input. For example, the hydra-cluster test suite uses a hardcoded cperiod on the client side.

  • Default value for T_Min is negative infinity.

  • Lower tx validity being in the future does not pose a problem since other participant is able to close a head.

What we want to achieve:

  • We want to enforce topmost formula in this file in our code on-chain.

  • Introduce maxGraceTime expressed in seconds in place of closeGraceTime and adjust to appropriate value.

  • The contestation period is to be used to create bounded close transaction (together with maxGraceTime). Before it was only used for computing the contestation deadline.

  • If contestation period is higher than maxGraceTime we will pick the latter. We still need maxGraceTime since if contestationPeriod is low for the current network our txs reach the upper bound fast and become invalid. That is why we set the upper tx bound to be minimum between contestationPeriod and maxGraceTime so that txs have high enough upper bound.

  • Make sure all head participants use the same value for contestationPeriod.

  • Attack vector has a corresponding mutation test.


  • Use the specification formula on-chain.

  • Configure the contestation period (number of seconds) on the hydra-node, e.g. via a --contestation-period command line option.

  • Lower tx bound should be the last known slot as reported by the cardano-node.

  • Upper tx bound is the current time + minimum between contestationPeriod and maxGraceTime.

  • When submitting the InitTx make sure to use --contestation-period value from our node's flag.

  • If other nodes observe OnInitTx and the contestationPeriod value does not match with their --contestation-period setting - ignore InitTx.

  • Rename closeGraceTime to maxGraceTime since we are using it also for upper bound of a contest tx.


  • Not any positive number of seconds is a valid contestation period any more!

  • Upper tx validity of close transaction is the minimum between maxGraceTime and contestationPeriod and this needs to be good enough value with respect to running network. This is a consequence required by the ledger when constructing transactions since we cannot convert arbitrary point in times to slots.

  • All parties need to aggree on contestation period before trying to run a Head protocol otherwise InitTx will be ignored.