Proof of Solvency & Slashing

MachPay’s security hinges on the Global Bond—a single collateral position that backs every payment an agent makes.[file:///Users/abhishektomar/Desktop/git/machpay-docs/whitepaper/machpay_whitepaper.pdf]

The Global Bond

  • Agents post collateral once into the BondManager contract.

  • Any vendor can accept a signed intent as long as the agent’s on-chain bond balance covers the quoted price.

  • Unlike Lightning’s per-vendor channels, a $50 bond can serve a hundred vendors simultaneously.

Optimistic Trust

Gateways do not query the blockchain every time. Instead, they:

  1. Cache the latest bond root from relayers.

  2. Verify signatures off-chain.

  3. Serve data instantly because the bond proves the agent can be slashed later.

This keeps authorization under 5 ms while still inheriting L2/L1 security.

Slashing Double-Spend Attempts

  • Risk: An agent signs receipts totaling more than the bonded amount.

  • Mitigation: Relayers aggregate receipts, compare to the bond snapshot, and submit a Fraud Proof if volume exceeds collateral.

  • Outcome: The slashAgent function burns part or all of the bond and optionally blacklists the offender, as defined in the whitepaper’s IMachPayCore interface.[file:///Users/abhishektomar/Desktop/git/machpay-docs/whitepaper/machpay_whitepaper.pdf]

Game Theory: Why Dine-and-Dash Fails

Let Bond = B and API Cost = C. Because the protocol requires B >> C, the expected penalty for cheating (losing the entire bond) dwarfs any single API call value. Rational agents maximize utility by staying solvent:

Expected Gain (cheat) = C
Expected Loss (caught) = B
If B ≥ 50 * C, cheating is economically irrational.

This incentive design scales across vendors, making MachPay safer than bilateral state channels and dramatically more capital efficient.[file:///Users/abhishektomar/Desktop/git/machpay-docs/whitepaper/machpay_whitepaper.pdf]

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