Hydrozoa L2: Pilot-ready Modern Interfaces

[Proposal setup] Proposal title

Please provide your proposal title

Hydrozoa L2: Pilot-ready Modern Interfaces

[Proposal Summary] Budget Information

Enter the amount of funding you are requesting in ADA

100000

[Proposal Summary] Time

Please specify how many months you expect your project to last

7

[Proposal Summary] Translation Information

Please indicate if your proposal has been auto-translated

No

Original Language

en

[Proposal Summary] Problem Statement

What is the problem you want to solve?

Hydrozoa MVP (fund 12) validated its design as a lightweight hydra head. Projects are excited to use it as an L2 workhorse, but they need modern interfaces for smoother adoption and integration.

[Proposal Summary] Supporting Documentation

Supporting links

• https://cardano-hydrozoa.github.io/hydrozoa/hydrozoa.pdf
,
• https://github.com/cardano-hydrozoa/hydrozoa
,
• https://milestones.projectcatalyst.io/projects/1200059

[Proposal Summary] Project Dependencies

Does your project have any dependencies on other organizations, technical or otherwise?

No

Describe any dependencies or write 'No dependencies'

No dependencies

[Proposal Summary] Project Open Source

Will your project's outputs be fully open source?

Yes

License and Additional Information

Apache License, Version 2.0 (http://www.apache.org/licenses/LICENSE-2.0)

[Theme Selection] Theme

Please choose the most relevant theme and tag related to the outcomes of your proposal

Layer2

[Campaign Category] Category Questions

Mention your open source license and describe your open source license rationale.

We use the Apache License, Version 2.0 (http://www.apache.org/licenses/LICENSE-2.0)..)..))

We have posted the corresponding copyright notice in our repository: https://github.com/cardano-hydrozoa/hydrozoa/blob/main/NOTICE.

How do you make sure your source code is accessible to the public from project start, and people are informed?

We use a single, public Github repository: https://github.com/cardano-hydrozoa/hydrozoa

This is the same repository that we have used since the beginning of the Fund 12 Hydrozoa project, and we have consistently referred to it in every milestone delivery and project-update video.

We also link to it in our socials.

How will you provide high quality documentation?

Our 54-page technical specification for Hydrozoa MVP from Fund 12 is already among the most detailed protocol documents in Cardano.

Furthermore, we will extensively document to a similar level the deliverables of this Fund 14 project.

[Your Project and Solution] Solution

Please describe your proposed solution and how it addresses the problem

As a result of the Hydrozoa fund 12 project (currently completing its final milestone), we have a detailed and well thought-out protocol design validated by a solid prototype. In particular, with our prototype, you can:

• Initialize a multi-party head (i.e. like Hydra) with a single, cheap L1 transaction (~0.19₳ fee).
• Create many pending deposits in parallel for the head (~0.18₳ fee per deposit).
• Use settlement transactions to simultaneously absorb many deposits into L2 and release unlimited withdrawals from L2 (~0.19₳ on average for a typical settlement tx).
• Enjoy rapid L2 transaction confirmation times even if funds are flowing into/out of the head.
• Avoid worry about peer state divergence (impossible by design) and disk usage bloat.
• Dynamically change the set of peers (if they all agree) without closing the head. (This feature is currently being completed in the final F12 milestone)

With these features, Hydrozoa is already enticing for early-adopters to try it — several projects have already privately approached us. However, the currently available interfaces provided by Hydrozoa are only sufficient for the basic demonstrations of Hydrozoa features that we needed in the Fund 12 project. In this F14 project, we will provide adopters with modern interfaces that they can use to flexibly and conveniently:

• Build and submit L2 transactions, L2 withdrawal requests, and L1 pending deposits.
• Query the current L2 state
• Query past L2 state (up to the earliest L2 block the head is configured to store)
• Query the currently pending L1 deposits and their lifecycles (maturity time, last possible absorption time, expiry/refund time).
• Subscribe to a filtered feed of L2 events and aggregate them into custom metrics

[Your Project and Solution] Impact

Please define the positive impact your project will have on the wider Cardano community

Hydrozoa's features make it very appealing as a simple middleware L2 solution to drive higher throughput, faster finality, and a better user experience for Cardano dApps. However, dApp development on top of Hydrozoa will be slow if only rudimentary, low-level interfaces are provided to query and interact with L2 state. If L2-enabled dApps are developed too slowly, then they may miss the chance to launch in favourable market and social conditions.

If we succeed in this project, Cardano builders will have an off-the-shelf middleware L2 solution that they can easily and confidently integrate into their tech stacks to delight users with experiences previously infeasible in Cardano.

A new generation of point-of-sale systems (like RareEvo's L2 vending machine), L2 gaming, micropayments, bridges, DEXs, oracles, and governance systems will elevate Cardano's value for the real world.

[Your Project and Solution] Capabilities & Feasibility

What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

We have designed and implemented the Hydrozoa protocol from a vague idea to the promising MVP prototype it is now. As reported in our F12 milestone reports, we have done so with good planning, transparency, technical competency, and a thorough attention to detail.

• https://milestones.projectcatalyst.io/projects/1200059/milestones/1/poa-1
• https://milestones.projectcatalyst.io/projects/1200059/milestones/2/poa-2
• https://milestones.projectcatalyst.io/projects/1200059/milestones/3/poa-3
• https://milestones.projectcatalyst.io/projects/1200059/milestones/4/poa-4

We will bring the same professionalism to this F14 project. Furthermore, we will leverage our team's extensive experience with Blockfrost, Cardano tx-building APIs, streaming indexers, and query-layer adapters.

This project is very feasible:

• Hydrozoa's design and architecture is well-understood and mature.
• Our implementation decisions in the existing prototype were taken with this interface extension in mind as a follow-up.
• The interface technologies we're targeting are well-documented and numerous projects support them.

[Milestones] Project Milestones

Milestone Title

Basic interface for query, control, and interaction

Milestone Outputs

1. REST API:
   1. Query the current L2 state.
   2. Prepare and submit L1 deposit transactions, L2 transactions, and L2 withdrawal requests.
   3. Control the hydra node.
2. Automatically generated REST API schema.
3. Documentation

Acceptance Criteria

1. The REST API covers the essential queries and interactions of a user/peer with a Hydrozoa node/head.
2. The generated REST API schema describes all endpoints, their input parameters, and possible outputs.
3. The documentation describes how to use the REST API.

Evidence of Completion

The proof of achievement

1. Links to the open-source project repository and project board.
2. Links to a brief video describing the outputs delivered in this milestone.

Delivery Month

2

Cost

30000

Progress

30 %

Milestone Title

Streaming interface

Milestone Outputs

1. Streaming (JSON-RPC + Websocket) query APIs:
   1. L2 state changes of interest
   2. L1 pending deposit updates
2. L2 indexing and customizable analytics (e.g. Scrolls)
3. Test suite for the above.
4. Documentation for the above.

Acceptance Criteria

1. Streaming APIs cover the same query capabilities as the REST APIs.
2. L2 indexing and analytics enables custom, filtered L2 event streams and aggregate metrics.
3. Test suite covers the above features.
4. Documentation covers the above features.

Evidence of Completion

The proof of achievement

1. Links to the open-source project repository and project board.
2. Links to a brief video describing the outputs delivered in this milestone.

Delivery Month

4

Cost

30000

Progress

60 %

Milestone Title

Advanced APIs

Milestone Outputs

1. Utxo-gRPC interface for L1 and L2 Hydrozoa state: https://utxorpc.org/
2. Tx3 Transaction Resolver Protocol (TRP) for Hydrozoa: https://itecture/trpgithub.com/tx3-lang/tx3
3. Tx3 templates and tools for Hydrozoa-enabled dApps
4. Test suite for the above.
5. Documentation for the above.

Acceptance Criteria

1. Utxo-gRPC interface covers the same capabilities (where applicable) as the REST and streaming APIs.
2. Tx3 TRP interface covers the same capabilities (where applicable) as the REST and streaming APIs.
3. Tx3 templates are sufficient for several examples provided in the Hydrozoa repository.
4. Test suite covers the above features.
5. Documentation covers the above features.

Evidence of Completion

The proof of achievement

1. Links to the open-source project repository and project board.
2. Links to a brief video describing the outputs delivered in this milestone.

Delivery Month

6

Cost

25000

Progress

90 %

Milestone Title

Polish and completion

Milestone Outputs

1. Close-out report and video for this milestone.
2. Final improvements and polish to project features. We intentionally reserve this output in the final milestone because Hydrozoa interfaces should be polished and convenient. :)
3. Final documentation.

Acceptance Criteria

1. Close-out report and video meet Catalyst's requirements for such deliverables in projects of this Catalyst category.
2. Project documentation describes all the interfaces, their input parameters, and expected outputs/streams.

Evidence of Completion

The proof of achievement

1. Links to the open-source project repository and project board.
2. Links to a brief closeout report and video describing the outputs delivered in this project.

Delivery Month

7

Cost

15000

Progress

100 %

[Final Pitch] Budget & Costs

Please provide a cost breakdown of the proposed work and resources

• Subtotal expected hours: 1,620 hr
• Contingency budget (10%): 162 hr
• Total hours: 1,782 hr
• Hourly rate: 75 USD/hr
• Total fiat: 133,650 USD
• Expected ADA price: 0.75 USD/ADA
• Total ADA: 100,237.50 ADA

[Final Pitch] Value for Money

How does the cost of the project represent value for the Cardano ecosystem?

The costs described in this proposal's budget breakdown have been developed based on a detailed plan of the activities required to achieve the milestones. We have high confidence in the comprehensiveness and accurate sizing of these activities, as we have engaged in very similar projects at the complexity level and subject domain in the past.

The ADA amounts for the developers on the team are commensurate with the amount of effort that the team members will contribute to the project. They are consistent with those that we and our fellow developers in the smart contracts and dApp sector have used in past projects to provide high-quality services, with a proven track record of delivering projects despite the complexity of viable applications in this space. This requires experts on staff with a diverse range of niche skill sets and deep knowledge of the Cardano and L2 protocols, the EUTXO model, and the modern practices of dApp design.

[Required Acknowledgements] Consent & Confirmation

Terms and Conditions:

Yes