Badgerswap v3 is a prototype, started at the IC3 Blockchain Summer Camp 2021.
Badgerswap v3 IS A PROTOTYPE to provide a confidential automated market maker (AMM). The prototype is based on Uniswap v3, and attempts to prevent front-running and sandwiching attacks by providing privacy for both traders and liquidity providers.
Badgerswap v3 uses multi-party computations (MPC) to preserve the privacy of traders and liquidity providers. The MPC network can viewed as a sidechain to the Ethereum blockchain. The Ethereum blockchain is used as communication channel and synchronization mechanism. Traders and liquidity providers can submit their “secret” trades and positions to the MPC sidechain via the Ethereum blockchain, which helps secure the availability of the information. The MPC nodes react to events happening on-chain, and thus be synchronized to carry out the computations.
Badgerswap v3 uses Ratel, a (prototype) high-level privacy-preserving programming language which allows developers to program both public and private computations. The public computations are deployed as a smart contract on the Ethereum blockchain meanwhile the private computations are deployed to the MPC sidechain as an MPC program.