ZEC Dark Perps - Privacy-Preserving Perpetual Futures on Solana

Program ID (Devnet): 7TeV1Vdps9eaMv8mfcXJgNsEzWBJwNi4kHfqaVkEu95u

Arcium MPC: Integrated for encrypted balance updates

ZEC Dark Perps - Privacy-Preserving Perpetual Futures on Solana

A Hyperliquid-inspired perpetual futures exchange with privacy-first architecture using Arcium MPC and encrypted storage.

🎯 What Makes This Unique

Traditional Perps Exchanges:

❌ All trades visible on-chain
❌ Position sizes public
❌ Easy to front-run large orders
❌ Whale tracking is trivial

ZEC Dark Perps:

✅ Encrypted Balances via Arcium Multi-Party Computation (MPC)
✅ Private Order Details with AES-256-GCM encryption
✅ Hyperliquid-Style Mechanics (position lifecycle, mark price, margin system)
✅ Zcash Bridge for private collateral deposits (in development)

🏗️ Architecture

┌─────────────────────────────────────────────────────────────┐
│                    MATCHING ENGINE (Off-Chain)               │
│  • Order Matching & Position Tracking                       │
│  • AES-256-GCM Encrypted Storage (Supabase)                │
│  • Mark Price & Real-Time PnL                               │
│  • Margin Checks (10x Leverage)                             │
└────────────────────┬────────────────────────────────────────┘
                     │
                     ▼
┌─────────────────────────────────────────────────────────────┐
│                  SOLANA PROGRAM (On-Chain)                   │
│  • Encrypted Margin Accounts (Arcium MPC)                   │
│  • Privacy-Preserving Trade Settlement                      │
│  • Zcash Bridge (wZEC Minting)                              │
└────────────────────┬────────────────────────────────────────┘
                     │
                     ▼
┌─────────────────────────────────────────────────────────────┐
│                   ARCIUM MPC CLUSTER                         │
│  • Encrypted Balance Updates                                │
│  • Zero-Knowledge Computations                              │
│  • Decentralized Privacy Layer                              │
└─────────────────────────────────────────────────────────────┘

🔐 Privacy Model

What's Encrypted (Private)

On-Chain (Arcium MPC):

✅ Margin account balances (encrypted_collateral, encrypted_debt)
✅ Trade settlement values (computed in MPC, re-encrypted)

Off-Chain (AES-256-GCM):

✅ Exact order sizes and prices
✅ User public keys (hashed with SHA-256)
✅ Position details (size, entry price, PnL)
✅ Trade details (buyer/seller, exact amounts)

What's Public (Necessary)

For Trading:

Order side (long/short)
Size buckets ('0-1', '1-10', '10-100', '100+')
Price levels (rounded to nearest $1)

For Safety:

Liquidation flags (liquidators need to identify risky accounts)
Transaction existence (Solana requirement)

For Transparency:

Aggregated metrics (total volume, open interest, trade count)

🚀 Quick Start Demo

Prerequisites

# Install dependencies
node --version  # v18+
npm --version   # v9+

# Solana CLI
solana --version  # v1.18+

# Anchor
anchor --version  # v0.30+

1. Start Matching Engine

cd services/matching-engine
npm install
npm run build
npm start

Expected Output:

🚀 ZEC Dark Perps Matching Engine
================================
📡 Server listening on http://localhost:3001
📊 Orderbook API: http://localhost:3001/api/orderbook
📝 Submit orders: POST http://localhost:3001/api/orders
================================

✅ Database connected
📦 Restoring orderbook from database...
✅ Restored 0 orders from database
🔄 Starting matching loop (200ms interval)

2. Place Orders (New Terminal)

# Place a LONG order
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{
    "userPubkey": "CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i",
    "side": "long",
    "size": 0.5,
    "price": 50.0
  }'

# Place a SHORT order (will match!)
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{
    "userPubkey": "9xQeWvG816bUx9EPjHmaT23yvVM2ZWbrrpZb9PusVFin",
    "side": "short",
    "size": 0.5,
    "price": 50.0
  }'

What Happens:

✅ Orders encrypted and stored in Supabase
✅ Matching engine finds the match
✅ Trade created with encrypted details
✅ Positions updated (weighted average entry price)
✅ Mark price updated for real-time PnL
✅ MPC settlement queued to Arcium 🔐

3. View Encrypted Data

# Check orderbook (bucketed data - public)
curl http://localhost:3001/api/orderbook | jq

# View user positions (decrypted server-side)
curl http://localhost:3001/api/positions/CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i | jq

# Check platform metrics
curl http://localhost:3001/api/metrics | jq

# View mark price
curl http://localhost:3001/api/mark-price | jq

# Check margin account
curl http://localhost:3001/api/account/CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i | jq

4. Watch MPC Settlement (Matching Engine Terminal)

🎯 Match found!
  Buyer: CyViyEZC... (0.5 @ $50)
  Seller: 9xQeWvG8... (0.5 @ $50)

💾 Trade saved to database (encrypted)
📊 Mark price updated: $50.00
📍 Position updated for CyViyEZC... (LONG 0.5 @ $50.00)
📍 Position updated for 9xQeWvG8... (SHORT 0.5 @ $50.00)

🔐 Queuing MPC settlement to Arcium...
   Buyer margin: CyViyEZC...
   Seller margin: 9xQeWvG8...
   Trade value: $25.00

⏳ Waiting for Arcium MPC callback...

🎬 Demo Script (For Video)

Scene 1: Introduction (30 seconds)

# Show the architecture
cat README.md | grep -A 20 "Architecture"

# Explain privacy model
echo "Traditional exchanges expose everything on-chain."
echo "ZEC Dark Perps encrypts balances, orders, and positions."
echo "Using Arcium MPC for zero-knowledge computations."

Scene 2: Start the System (30 seconds)

# Terminal 1: Start matching engine
cd services/matching-engine
npm start

# Show it's connected to Supabase and ready

Scene 3: Place Orders & Show Encryption (2 minutes)

# Terminal 2: Place LONG order
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{"userPubkey":"CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i","side":"long","size":0.5,"price":50.0}'

# Show orderbook (bucketed - privacy preserved)
curl http://localhost:3001/api/orderbook | jq

# Explain: "Notice the size is bucketed as '0-1', not exact 0.5"
# Explain: "User pubkey is hashed, not visible"

# Place SHORT order to trigger match
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{"userPubkey":"9xQeWvG816bUx9EPjHmaT23yvVM2ZWbrrpZb9PusVFin","side":"short","size":0.5,"price":50.0}'

Scene 4: Watch MPC Settlement (1 minute)

# Terminal 1 will show:
# - Match found
# - Trade encrypted and saved
# - Positions updated
# - MPC settlement queued to Arcium
# - Waiting for callback

# Explain: "The matching engine queues encrypted balance updates to Arcium MPC"
# Explain: "Only the MPC cluster can decrypt and update balances"
# Explain: "This prevents anyone (including us) from seeing exact balances"

Scene 5: Show Position Lifecycle (1 minute)

# Check user position
curl http://localhost:3001/api/positions/CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i | jq

# Explain the output:
# - Position side: LONG
# - Size: 0.5
# - Entry price: $50.00
# - Current PnL: calculated using mark price
# - Leverage: 10x

# Place another order to show position increase
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{"userPubkey":"CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i","side":"long","size":0.3,"price":52.0}'

curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{"userPubkey":"9xQeWvG816bUx9EPjHmaT23yvVM2ZWbrrpZb9PusVFin","side":"short","size":0.3,"price":52.0}'

# Check position again - weighted average entry price
curl http://localhost:3001/api/positions/CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i | jq

# Explain: "Position increased from 0.5 to 0.8"
# Explain: "Entry price is weighted average: (50*0.5 + 52*0.3)/0.8 = $50.75"

Scene 6: Show Margin System (1 minute)

# Check account margin
curl http://localhost:3001/api/account/CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i | jq

# Explain the output:
# - Margin Balance: $1,000 (mock for demo)
# - Equity: Balance + Unrealized PnL
# - Total Notional: Position size * mark price
# - Leverage: Actual leverage being used
# - Margin Used: Notional / 10
# - Margin Available: What's left for new orders

# Try to place order that exceeds margin
curl -X POST http://localhost:3001/api/orders \
  -H "Content-Type: application/json" \
  -d '{"userPubkey":"CyViyEZCjHBJPKzCYZ7sSDm2e3YCdgxrjbCj3PLyvT8i","side":"long","size":200,"price":50.0}'

# Should get rejected with:
# "Insufficient margin. Required: $X, Available: $Y"

Scene 7: Show Platform Metrics (30 seconds)

# View aggregated metrics
curl http://localhost:3001/api/metrics | jq

# Explain:
# - Total Volume (24h): Sum of all trades
# - Open Interest: Total position notional
# - Total Trades: Number of matches
# - Active Traders: Unique users
# - All calculated from encrypted data!

Scene 8: Database Privacy (1 minute)

# Show Supabase schema
cat services/matching-engine/supabase/schema.sql | grep -A 10 "CREATE TABLE orders"

# Explain:
# - user_hash: SHA-256 hashed pubkey
# - size_bucket: '0-1', '1-10', etc (not exact)
# - price_level: Rounded to $1
# - encrypted_details: AES-256-GCM encrypted exact data

# Show encryption code
cat services/matching-engine/src/crypto.ts | grep -A 15 "export function encrypt"

# Explain:
# - AES-256-GCM authenticated encryption
# - Random IV per encryption
# - Auth tag for integrity

📊 What's Working (Demo-Ready)

✅ Core Trading

Order placement with encryption
Order matching (FIFO, price-time priority)
Trade execution with encrypted storage
Position lifecycle (open/increase/reduce/close/flip)
Mark price tracking (last trade price)
Real-time unrealized PnL calculation

✅ Privacy Layer

AES-256-GCM encryption for sensitive data
SHA-256 hashing for user identifiers
Size bucketing and price rounding
Arcium MPC integration (queue_settle_trade)
Encrypted margin accounts on-chain

✅ Risk Management

Initial margin checks (10x leverage)
Account equity calculation
Order rejection when insufficient margin
Maintenance margin calculation (for liquidations)

✅ Analytics

Platform metrics (volume, open interest, trades)
User position tracking
Trade history
Mark price API

🔧 Technical Stack

On-Chain:

Solana (Devnet)
Anchor Framework v0.30
Arcium MPC for encrypted computations
SPL Token (wZEC)

Off-Chain:

Node.js + TypeScript
Supabase (PostgreSQL)
AES-256-GCM encryption
Express.js REST API

Frontend:

Next.js 14
Solana Wallet Adapter
TailwindCSS + shadcn/ui
Recharts for analytics

📈 Performance

Matching Engine:

Matching interval: 200ms (5 matches/sec)
Database latency: ~50-100ms
Order encryption: <1ms

On-Chain:

MPC settlement: 5-30 seconds (Arcium devnet)
Transaction cost: ~0.001 SOL
Confirmation time: ~400ms (Solana)

🔐 Security Features

Encryption:

AES-256-GCM for database (authenticated encryption)
Arcium MPC for on-chain balances (zero-knowledge)
Random IV per encryption (prevents pattern analysis)

Privacy:

User pubkeys hashed with salt
Order sizes bucketed
Prices rounded
Exact details only in encrypted fields

Risk Management:

Initial margin: 10% (10x leverage)
Maintenance margin: 5%
Liquidation monitoring (to be implemented)

🚧 Roadmap

Phase 1: Core Trading ✅ (COMPLETE)

Order matching engine
Position lifecycle
Mark price system
Margin checks

Phase 2: Privacy Layer ✅ (COMPLETE)

Encrypted storage
Arcium MPC integration
Hashed identifiers

Phase 3: Bridge Integration 🚧 (IN PROGRESS)

On-chain bridge instructions
Zcash bridge daemon
Deposit monitoring
Withdrawal processing

Phase 4: Production Ready 📋 (PLANNED)

📚 Documentation

SYSTEM_ARCHITECTURE.md - Complete system design and privacy model
PERPS_ANALYSIS.md - Analysis of architecture decisions
ARCIUM_COMPLETE_IMPLEMENTATION.md - MPC integration guide
ZCASH_BRIDGE_COMPLETE_GUIDE.md - Bridge implementation

🎯 Key Differentiators

Privacy-First: Only perps exchange with encrypted balances via MPC
Hyperliquid Mechanics: Professional trading with position lifecycle
Zcash Integration: Private collateral deposits (unique in DeFi)
Hybrid Model: Balance privacy with operational transparency

🤝 Contributing

This is a research project exploring privacy-preserving DeFi. Contributions welcome!

⚠️ Disclaimer

This is experimental software on devnet. Not audited. Not for production use. Educational purposes only.

📞 Contact

Built with ❤️ for privacy-preserving DeFi

Status: MVP - Core trading functional, bridge in development

Name		Name	Last commit message	Last commit date
Latest commit History 33 Commits
arcium		arcium
build		build
config		config
encrypted-ixs		encrypted-ixs
frontend		frontend
migrations		migrations
programs/zec_dark_perps		programs/zec_dark_perps
services/matching-engine		services/matching-engine
tests		tests
.gitignore		.gitignore
.prettierignore		.prettierignore
Anchor.toml		Anchor.toml
Arcium.toml		Arcium.toml
Cargo.toml		Cargo.toml
README.md		README.md
package.json		package.json
rust-toolchain.toml		rust-toolchain.toml
tsconfig.json		tsconfig.json
yarn.lock		yarn.lock

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ZEC Dark Perps - Privacy-Preserving Perpetual Futures on Solana

🎯 What Makes This Unique

🏗️ Architecture

🔐 Privacy Model

What's Encrypted (Private)

What's Public (Necessary)

🚀 Quick Start Demo

Prerequisites

1. Start Matching Engine

2. Place Orders (New Terminal)

3. View Encrypted Data

4. Watch MPC Settlement (Matching Engine Terminal)

🎬 Demo Script (For Video)

Scene 1: Introduction (30 seconds)

Scene 2: Start the System (30 seconds)

Scene 3: Place Orders & Show Encryption (2 minutes)

Scene 4: Watch MPC Settlement (1 minute)

Scene 5: Show Position Lifecycle (1 minute)

Scene 6: Show Margin System (1 minute)

Scene 7: Show Platform Metrics (30 seconds)

Scene 8: Database Privacy (1 minute)

📊 What's Working (Demo-Ready)

✅ Core Trading

✅ Privacy Layer

✅ Risk Management

✅ Analytics

🔧 Technical Stack

📈 Performance

🔐 Security Features

🚧 Roadmap

Phase 1: Core Trading ✅ (COMPLETE)

Phase 2: Privacy Layer ✅ (COMPLETE)

Phase 3: Bridge Integration 🚧 (IN PROGRESS)

Phase 4: Production Ready 📋 (PLANNED)

📚 Documentation

🎯 Key Differentiators

🤝 Contributing

⚠️ Disclaimer

📞 Contact

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