Introduction

Open and Trustless Architecture

The Current Solver Landscape

To operate as a market maker (solver) today in existing request for quote systems (RFQ) such as Cowswap and 1Inch Fusion solvers must stake a significant amount of capital in order to compete in providing end-users with the best possible price quotes. In 1Inch Fusion solvers are prioritized based on the amount of 1INCH token staked. In Cowswap solvers must bond ~500k USDC and 1.5M COW (a total of $1M at the time of proposal) in order to become a solver. In both of these systems becoming a solver is gated.

Additionally the architectures that run existing RFQ systems are centralized, require trust (centralized infrastructure selects the best quote for you), and have single points of failure.

At Openflow we believe this pay-to-play model limits competition, innovation and decentralization and thus a new completely open and trustless protocol in which anyone can compete is presented.

Decentralized Order Book and Infrastructure

In Openflow orders of all types can be submitted completely on-chain. Openflow is transparent and transport agnostic. In addition to on-chain order submission orders can be submitted via libp2p and webRTC enabling peer-to-peer communication between solvers, drivers and end-users.

In many cases reliability is of utmost importance. In existing systems if an order-book or API goes down the protocol will cease to operate. In Openflow the protocol is designed to be as resilient as possible.

Trustless Quote Selection

In existing systems users must trust centralized order matching engines to give users the best prices (and not to extract value from them). Openflow believes this is a problem and aims to solve this using two mechanisms:

• Peer-to-peer user selected quotes

  • For end-users, users can solicit quotes from solvers directly.

  • End-users can determine for themselves which quote is the best quote. The is no need to offload quote selection to a centralized server.

• User delegated multisig authenticated quotes

  • For smart contracts (and optionally for end-users) a user selected decentralized driver (quote selector) is utilized.

  • With driver/multisig authenticated quotes, an order cannot be executed until the decentralized driver signs the order to verify that the selected quote truly is the best quote.

  • If a user does not trust the default decentralized driver (operated by Openflow and other top-tier DeFi protocols) the user can easily run their own driver network.

Simplicity and Security

At Openflow the core protocol is designed to be as simple and secure as possible. It is essentially a DeFi primitive that allows users to securely OTC assets with an open pool of solvers, where the user is agnostic as to how the swap is executed, or really any other details --the only thing that is important is that the conditions of the swap are met and that the user receives at least the amount of tokens agreed upon. These are the major guarantees of the protocol.

A simplified swap flow is as follows:

• User submits a request for quotes (RFQ)

• Solvers provide user with quotes

• User selects the best quote and passes their signature to the solver who offered the best quote

• Solver performs the swap using any means necessary

• User is guaranteed to receive the amount of tokens agreed upon

By eliminating the need to trust solvers and centralized drivers we end up with a lightweight protocol where any potential attack vectors typically introduced in high complexity systems are vastly mitigated.

Additionally by outsourcing order execution to a decentralized pool of solvers and essentially performing authenticated OTC swaps the end user is protected from MEV extraction.

Extreme Flexibility

Openflow offers two unique features which are currently offered by no one else on the market.

Conditional Swaps

All swaps come equipped with the ability to execute only if a specific set of user-defined swap conditions are met. Swap conditions must be satisfied at the time of order execution or else the swap cannot complete.

This allows users to create a large variety of smart swaps based on whatever parameters they desire. For instance a user could decide to swap only if certain TWAP conditions are met. A user could also decide to swap based on virtually any other on-chain indicator of their choice. This also unlocks other capabilities such as stop loss orders, DCA, etc.

User-defined Hooks

Users are able to customize signed/user-authenticated pre-swap and post-swap hooks. Essentially these are methods that must be called by the solver on an array of contracts specified by the user as an integral part of swap process.

By leveraging user-defined hooks a range of possibilities is opened up:

• Users can utilize hooks to perform custom setup/tear-down logic

• Users can utilize hooks as a decentralized keep3r system where they can pay for arbitrary on-chain contract interactions to happen when specific conditions are met with any token of their choice

• User-defined zap logic

  • By allowing end-users to specify zap logic users can take advantage of a complete pool of decentralized solvers for the underlying swap (rather than 1 or 2 specialized solvers) meaning more competitive prices for users

• Cascading transactions

  • After a swap is completed a user can, in an automated way, submit an additional swap in the post-swap hook. This unlocks programmable cascading transactions to enable order types such as recurring and iceberg orders

For more information on the types of swaps Openflow unlocks check out the features section.

Robust Order Management

In Openflow a user can submit a wide range of simultaneous orders with any combination of conditional logic desired. The protocol also offers the ability to cancel both single orders and all current orders for a user on-chain.

High Interoperability

The system is designed to be as easy to integrate with as possible.

Smart contracts and protocols are first class citizens in Openflow.

Openflow allows smart contracts to create trustless, decentralized and highly configurable swap auctions on-chain, giving protocols, smart contracts and multisig users an extensive toolkit for swap execution.