Security Model
Botanix's current security model is built on multiple layers of protection that work together to secure user funds and maintain network integrity. This chapter outlines the core security assumptions, trust requirements, and protective mechanisms that make Botanix a secure Bitcoin Layer 2 solution.
Core Security Architecture
Multi-layered Protection
Botanix security operates through several interconnected layers. The foundation is the federation's reputation-based security, where 16 trusted entities stake their reputation and economic interests on honest behavior. Above this sits the cryptographic layer using threshold signatures and distributed key generation, ensuring no single entity can compromise user funds.
The protocol layer implements consensus through CometBFT with Byzantine fault tolerance, while the application layer includes smart contract security measures and comprehensive input validation. Finally, the Bitcoin layer provides ultimate settlement security through the world's most secure blockchain.
Trust Assumptions
The Botanix security model requires that fewer than one-third of federation members act maliciously. With 16 federation members, the network can tolerate up to 5 Byzantine actors while maintaining security and liveness. This assumption is reinforced by the economic and reputational incentives of federation members who have significant stake in the network's success.
Users must also trust that the federation will not collude to steal funds, though the 12-of-16 threshold makes such collusion extremely difficult and economically irrational for established ecosystem participants.
Federation Security
Economic Incentives
Federation members have strong economic incentives to act honestly. Each member has invested significantly in infrastructure, reputation, and long-term commitments to the Bitcoin ecosystem. Malicious behavior would result in immediate detection, loss of business relationships, and destruction of their reputation in the broader cryptocurrency community.
The federation model creates aligned incentives where members benefit from network growth and user adoption, making the long-term value of honest participation far greater than any short-term gains from malicious behavior.
Operational Security
Each federation member maintains enterprise-grade security practices including secure key storage, multi-factor authentication, segregated network access, and comprehensive monitoring systems. Members undergo regular security audits and must demonstrate adherence to established security standards.
The distributed nature of the federation means that even if individual members experience security incidents, the overall network security remains intact as long as fewer than 5 members are compromised simultaneously.
Cryptographic Security
Threshold Signatures
The 12-of-16 threshold signature scheme ensures that no small group of federation members can unilaterally access user funds. Using FROST (Flexible Round-Optimized Schnorr Threshold signatures), the federation can collectively sign Bitcoin transactions without exposing individual private keys or requiring all members to be online simultaneously.
This threshold provides optimal security while maintaining operational flexibility, allowing the network to continue functioning even when several members are temporarily unavailable due to maintenance, network issues, or other operational considerations.
Distributed Key Generation
The federation's Bitcoin custody keys are generated through a distributed key generation ceremony where no single entity ever possesses the complete private key. This process ensures that the multi-signature wallet controlling user funds is inherently distributed from inception.
Key refresh ceremonies can be performed periodically to maintain security over time, allowing the federation to rotate keys without disrupting user operations or requiring movement of Bitcoin funds.
Attack Resistance
Byzantine Fault Tolerance
The CometBFT consensus mechanism provides Byzantine fault tolerance, ensuring the network continues operating correctly even when up to 5 federation members behave arbitrarily or maliciously. This includes resistance to various attack scenarios such as double-spending attempts, chain history manipulation, and denial-of-service attacks.
The consensus mechanism guarantees that all honest federation members will agree on the same transaction history, preventing conflicting states or transaction reversals that could compromise user funds.
Bridge Security
The bridging mechanism implements multiple layers of validation to prevent unauthorized minting or burning of tokens. Each peg-in requires cryptographic proof of valid Bitcoin deposits with sufficient confirmations, while peg-outs require proper token burning and federation consensus for Bitcoin release.
Comprehensive replay protection prevents the same Bitcoin deposit from being processed multiple times, while strict accounting ensures the total token supply never exceeds the Bitcoin held in custody.
Network Security
The network implements robust protections against various attack vectors including transaction flooding, state manipulation, and consensus disruption. Rate limiting, gas mechanisms, and validation procedures ensure that malicious actors cannot overwhelm the network or compromise its operation.
The fixed validator set eliminates certain attack vectors present in permissionless networks, such as stake grinding or validator replacement attacks, while the federation's known identities enable accountability and dispute resolution.
Risk Mitigation
Operational Risks
The federation model mitigates operational risks through geographic distribution, diverse operational practices, and redundant infrastructure. Members operate in different jurisdictions with varying regulatory environments, reducing the impact of localized regulatory changes or infrastructure disruptions.
Regular communication and coordination protocols ensure that temporary unavailability of individual members does not impact network operations, while emergency procedures enable rapid response to significant operational challenges.
Technical Risks
Smart contract risks are mitigated through comprehensive security audits, formal verification where applicable, and conservative design practices that prioritize security over feature complexity. The protocol includes circuit breakers and emergency procedures that can halt operations if critical vulnerabilities are discovered.
Regular security assessments and bug bounty programs help identify and address potential vulnerabilities before they can be exploited, while the federation's technical expertise ensures rapid response to emerging threats.
Economic Risks
The 1:1 peg between Bitcoin and Botanix tokens eliminates many economic risks present in other bridging solutions. Users' funds are fully backed by actual Bitcoin rather than synthetic assets or algorithmic mechanisms that could fail under market stress.
The federation's economic alignment ensures that members have strong incentives to maintain the peg and protect user funds, as any loss of confidence would directly impact their own economic interests and business operations.
Emergency Procedures
Incident Response
The federation maintains comprehensive incident response procedures for various scenarios including security breaches, operational failures, and external attacks. These procedures include rapid communication protocols, emergency decision-making processes, and technical response capabilities.
In extreme scenarios, the federation can halt bridge operations to prevent further damage while investigating and resolving security incidents. This temporary halt protects user funds while maintaining the ability to resume normal operations once threats are addressed.
Recovery Mechanisms
The distributed nature of the federation's key management enables recovery from various failure scenarios. Even if several federation members lose access to their key shares, the remaining members can continue operations and potentially initiate key refresh procedures to restore full operational capacity.
Bitcoin custody remains secure even during recovery procedures, as the threshold signature requirements ensure that user funds cannot be accessed without sufficient federation consensus throughout any recovery process.
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