🌊 Arcis Protocol

Next-Generation Stablecoin Liquidity, Real-Yield Vaults & AI Agentic Settlement on Arc L1

Arcis is a high-performance decentralized finance (DeFi) protocol and liquidity engine purpose-built for Arc — Circle's Layer-1 blockchain where USDC is the native gas token with sub-second deterministic finality.

Executive Summary • Core Mechanisms • Smart Contracts • Pools & Vaults • AI Agent Hub • Circle Gateway • Deployment

📌 Executive Summary

Modern DeFi is hindered by volatile gas tokens, slow cross-chain bridges, impermanent loss, and inflationary "farm-and-dump" reward tokens. Arcis completely reimagines on-chain capital efficiency and user experience by leveraging Arc's native USDC architecture and Circle's cross-chain stack.

                                  ╔═════════════════════════════════════════╗
                                  ║          Arcis Unified Interface        ║
                                  ╚═════════════════════════════════════════╝
                                                       │
         ┌─────────────────────┬───────────────────────┼───────────────────────┬─────────────────────┐
         ▼                     ▼                       ▼                       ▼                     ▼
 ┌───────────────┐     ┌───────────────┐       ┌───────────────┐       ┌───────────────┐     ┌───────────────┐
 │ 🌐 Unified    │     │ 💱 Stable &   │       │ 🏦 Real-Yield │       │ 🤖 AI Agent   │     │ ⚡ Cross-Chain │
 │    Balance    │     │    AMMs Pools │       │    Vaults     │       │    Escrows    │     │    Routing    │
 │ (13+ Chains)  │     │ (Zero IL / CP)│       │  (ERC-4626)   │       │  (ERC-8183)   │     │ (Gateway/Memo)│
 └───────────────┘     └───────────────┘       └───────────────┘       └───────────────┘     └───────────────┘
         │                     │                       │                       │                     │
         └─────────────────────┴───────────────────────┼───────────────────────┴─────────────────────┘
                                                       │
                                  ╔═════════════════════════════════════════╗
                                  ║       Arc L1 Native USDC Engine         ║
                                  ║   (Sub-Second Finality • Zero ETH Gas)  ║
                                  ╚═════════════════════════════════════════╝

🌟 Key Innovations

Gas-Abstracted with Native USDC: No ETH or native gas tokens needed. All transactions and gas fees on Arc are executed natively in USDC (0x3600...0000).
Real-Yield ERC-4626 Vault: Zero token inflation. 90% of all platform transaction fees (Send, Swap, Bridge) flow directly to the YieldVault in pure USDC dividends.
Yield-Generating AI Agent Escrow (ERC-8183 & ERC-8004): Idle task escrow funds are staked into the ERC-4626 vault during agent execution, providing cash-back yields to sponsors and bonuses to autonomous agents.
Sub-Second Multi-Chain Gateway: Instant (<500ms) cross-chain liquidity aggregation across 13+ testnet networks powered by Circle Gateway's burn-and-mint architecture.
Dual-AMM Architecture: Constant-Sum ($x + y = k$) for zero-slippage FX pairs (USDC/EURC) and Constant-Product ($x \cdot y = k$) for volatile assets (USDC/cirBTC).
On-Chain Memos & Privacy Sector: Native payment memos with invoice hashes (Memo.sol) and Arc Privacy Sector (APS) post-quantum encryption compatibility.

🏛️ Core Architecture & Mechanisms

flowchart TB
    subgraph ClientLayer["Frontend & Auth Layer"]
        UI["Arcis React 18 / Vite DApp"]
        Wagmi["Wagmi / Viem Web3 Connectors"]
        UCW["Circle User-Controlled Wallets (Social / WebAuthn / OTP)"]
        UI --> Wagmi
        UI --> UCW
    end

    subgraph ArcL1["Arc Layer-1 Blockchain (Chain ID: 5042002)"]
        NativeGas["Native USDC Gas Engine (18 Dec Native / 6 Dec ERC-20)"]
        
        subgraph AMMLayer["Automated Market Makers (AMM)"]
            StablePool["StableSwapPool (USDC / EURC)<br/>x + y = k (0.12% Fee)"]
            CPPool["ConstantProductPool (USDC / cirBTC)<br/>x * y = k (0.25% Fee)"]
        end

        subgraph VaultLayer["Yield & Treasury"]
            YieldVault["YieldVault.sol (ERC-4626)<br/>af-USDC Share Token"]
            Treasury["Protocol Treasury & Fee Distributor"]
            YieldVault <-->|Real USDC Compounding| Treasury
        end

        subgraph AgentLayer["Agentic Economy (ERC-8183 / ERC-8004)"]
            BountyHub["Agent Bounty & Job Escrow"]
            SentinelAgents["Autonomous Agents (Arbitrage / Provers / Keepers)"]
            BountyHub -->|Stake Idle Escrow| YieldVault
            SentinelAgents -->|Submit Proof-of-Work| BountyHub
        end

        subgraph UtilityLayer["On-Chain Metadata & Privacy"]
            MemoContract["Memo.sol (0x5294...)<br/>Invoice Refs & Payment Hashing"]
            APS["Arc Privacy Sector (APS)<br/>Post-Quantum Stealth Masking"]
        end
    end

    subgraph CrossChainLayer["Cross-Chain Interoperability"]
        Gateway["Circle Gateway (<500ms Instant Burn/Mint)"]
        CCTP["Circle CCTP v2 (Native Canonical Bridge)"]
        MultiChains[("13+ Connected Networks:<br/>Sepolia, Base, Arbitrum, Optimism,<br/>Polygon, Avalanche, Solana, Sonic...")]
        Gateway <--> MultiChains
        CCTP <--> MultiChains
    end

    ClientLayer ==> ArcL1
    ArcL1 <==> CrossChainLayer
    AMMLayer -->|Protocol Fee Share (90%)| Treasury

📜 Smart Contracts & Verified Deployments

All contracts are compiled with Solidity 0.8.24 via Foundry and deployed to Arc Testnet (Chain ID: 5042002).

Contract	Type / Standard	Arc Testnet Address	Explorer
Native USDC	Gas Token & ERC-20	`0x3600000000000000000000000000000000000000`	ArcScan
EURC	Circle Euro Coin (ERC-20)	`0x89B50855Aa3bE2F677cD6303Cec089B5F319D72a`	ArcScan
cirBTC	Circle Wrapped Bitcoin	`0xf0C4a4CE82A5746AbAAd9425360Ab04fbBA432BF`	ArcScan
StableSwapPool	Constant-Sum AMM ($x+y=k$)	`0x6d8fda7557d1c0a945a955557e10a4e70a129d20`	ArcScan
ConstantProductPool	Real cirBTC AMM ($x \cdot y=k$)	`0x179c9d7f75b0aee8ffe9451fec060b9639220fe6`	ArcScan
YieldVault	ERC-4626 Real-Yield Vault	`0x4a4f0c1dd34c5433a228cbc3a499fabf18e3156d`	ArcScan
Memo Contract	On-Chain Metadata Router	`0x5294E9927c3306DcBaDb03fe70b92e01cCede505`	ArcScan
Protocol Treasury	Revenue Distribution Hub	`0x4a4f0c1dd34c5433a228cbc3a499fabf18e3156d`	ArcScan

🔬 Mathematical & Economic Models

1. StableSwap Invariant ($x + y = k$)

For pegged stablecoin foreign exchange (e.g. USDC/EURC), Arcis implements a constant-sum model with fixed fee deductions: $$\Delta y = \Delta x \cdot (1 - \phi)$$ where $\phi = 0.0012$ (12 bps).

Zero Impermanent Loss: Ideal for correlated fiat assets.
50/50 Dual Liquidity & 1-Click Zap: Users can deposit pure USDC, which is automatically balanced and minted as af-USDC-EURC LP shares: $$\text{Shares}_{\text{minted}} = \frac{(\Delta A + \Delta B) \cdot \text{TotalLP}}{R_A + R_B}$$

2. Constant-Product AMM ($x \cdot y = k$)

For volatile pairs (USDC/cirBTC), Arcis maintains an invariant product curve: $$(x + \Delta x \cdot (1 - \phi)) \cdot (y - \Delta y) = k$$ where $\phi = 0.0025$ (25 bps). The output amount received is: $$\Delta y = \frac{y \cdot \Delta x \cdot (1 - \phi)}{x + \Delta x \cdot (1 - \phi)}$$

3. ERC-4626 Real Yield Distribution Model

Unlike inflationary reward schemes, YieldVault.sol distributes actual USDC cash: $$\text{Share Price} = \frac{\text{Total Assets (USDC)}}{\text{Total Supply Shares}}$$ When distributeYield(amount) is triggered by the protocol revenue router: $$\text{Net Yield} = \text{Amount} \cdot (1 - \text{PerformanceFee})$$ $$\text{TotalAssets}{\text{new}} = \text{TotalAssets}{\text{old}} + \text{Net Yield}$$ This immediately appreciates the redemption value of every minted af-USDC share.

🏊 Liquidity Pools & Vault Catalog

Arcis Pools & Vaults Hub
├── 💱 Liquidity Pools (AMM)
│   ├── USDC–EURC Stable Pool        → 6.15% FX APR | Zero IL | 1-Click Zap
│   └── USDC–cirBTC Liquidity Pool   → 12.80% APR   | Circle Wrapped Bitcoin
├── 🏦 Single-Asset Vault
│   └── USDC Yield Vault (ERC-4626)  → 8.42% APR    | Real USDC Revenue Share
└── 🌐 Cross-Chain Liquidity
    └── Gateway Settlement Pool      → 7.25% APR    | Instant 9+ Chain Settlement

Pool / Vault Name	Category	Risk Profile	Target APR	Yield Source	Key Features
USDC / EURC Stable Pool	Liquidity AMM	🟢 Safe (Zero IL)	6.15%	FX Swap Fees (0.12%)	1-Click Zap, No Impermanent Loss
USDC / cirBTC Liquidity Pool	Liquidity AMM	🟡 Medium	12.80%	AMM Volume Fees (0.25%)	Circle Wrapped Bitcoin, 1-Click Zap
USDC Yield Vault	ERC-4626 Vault	🔵 Low	8.42%	90% Protocol Revenue Share	Pure USDC Payout, No Lockup
Gateway Settlement Pool	Cross-Chain	🔵 Low	7.25%	Cross-Chain Routing (0.03%)	<500ms Sub-Second Finality Buffer

🤖 ERC-8183 & ERC-8004 AI Agent Hub

Arcis introduces the first Yield-Generating Escrow Mechanism for the Agentic Economy on Arc L1.

sequenceDiagram
    autonumber
    actor Sponsor as Protocol Sponsor / User
    participant Escrow as Arcis Bounty Escrow (ERC-8183)
    participant Vault as Real-Yield Vault (ERC-4626)
    participant Agent as Autonomous AI Agent (ERC-8004)

    Sponsor->>Escrow: Create/Fund Bounty (e.g. 2,500 USDC)
    Note over Escrow,Vault: Capital is not left idle!
    Escrow->>Vault: Automatically deposit 2,500 USDC into Yield Vault
    Vault-->>Escrow: Mint af-USDC shares (Earning 8.42% APY)
    
    Agent->>Agent: Execute Task (Arbitrage / ZK Verification / Keeper)
    Agent->>Escrow: Submit Proof-of-Execution Hash

    alt Proof Verified & Settled
        Escrow->>Vault: Redeem shares for Principal + Accumulated Yield
        Vault-->>Escrow: Return 2,500 USDC + Accrued USDC Dividends
        Escrow->>Agent: Payout 2,500 USDC Bounty Reward (+ Bonus Yield)
        Escrow->>Sponsor: Payout Cash-Back Dividend to Sponsor
    end

Active Autonomous Agents in Arcis:

ArcSentinel-v4 (0x8004A7...1B89 | Rep: 99): Continuous Multi-Chain FX Arbitrage Sentinel monitoring USDC/EURC rate deviations between Arc Testnet and Base Sepolia.
GatewayProver-01 (0x8004B9...2B99 | Rep: 97): Sub-second finality verifier ensuring <500ms burn-and-mint settlement across 9 EVM testnets.
FluxOptimizer-AI (0x8004C8...8901 | Rep: 95): High-frequency DEX liquidity guard maintaining StableSwap slippage below 0.05%.

🌐 Cross-Chain Gateway & Multi-Network Engine

Arcis is connected to 13+ blockchain networks using Circle Gateway's sub-second attestation layer and CCTP v2.

                               ┌───────────────────────────┐
                               │  Circle Gateway Hub       │
                               │  (Unified Balance Ledger) │
                               └─────────────┬─────────────┘
                                             │
      ┌────────────────┬─────────────────────┼─────────────────────┬────────────────┐
      ▼                ▼                     ▼                     ▼                ▼
┌───────────┐    ┌───────────┐         ┌───────────┐         ┌───────────┐    ┌───────────┐
│ Arc L1    │    │ Ethereum  │         │ Base      │         │ Arbitrum  │    │ Solana    │
│ Testnet   │    │ Sepolia   │         │ Sepolia   │         │ Sepolia   │    │ Devnet    │
│ (Domain 26│    │ (Domain 0)│         │ (Domain 6)│         │ (Domain 3)│    │ (Domain 5)│
└───────────┘    └───────────┘         └───────────┘         └───────────┘    └───────────┘

Supported Gateway Networks & Testnet Domain IDs:

Network	Domain ID	Average Settlement	USDC Contract Address
Arc Testnet	`26`	380 ms	`0x3600000000000000000000000000000000000000`
Ethereum Sepolia	`0`	420 ms	`0x1c7D4B196Cb0C7B01d743Fbc6116a902379C7238`
Base Sepolia	`6`	390 ms	`0x036CbD53842c5426634e7929541eC2318f3dCF7e`
Arbitrum Sepolia	`3`	410 ms	`0x75faf114eafb1BDbe2F0316DF893fd58CE46AA4d`
Optimism Sepolia	`2`	430 ms	`0x5fd84259d66Cd46123540766Be93DFE6D43130D7`
Polygon Amoy	`7`	450 ms	`0x41e94eb019c0762f9bfcf9fb1e58725bfb0e7582`
Avalanche Fuji	`1`	400 ms	`0x5425890298aed601595a70ab815c96711a31bc65`
Solana Devnet	`5`	440 ms	`4zMMC9srt5Ri5X14GAgXhaHii3GnPAEERYPJgZJDncDU`
Sonic Testnet	`13`	340 ms	`0x0BA304580ee7c9a980CF72e55f5Ed2E9fd30Bc51`
HyperEVM / Sei / Uni / World	`19 / 16 / 10 / 14`	<400 ms	Configured in `src/config/gatewayConfig.ts`

⚡ Core Features Walkthrough

1. 🌐 Unified Cross-Chain Balance

Consolidates your USDC holdings across all 13 chains into a single liquid balance.
Deposit testnet USDC on any chain and spend it instantly on Arc without waiting for manual bridge confirmations.

2. 💸 Fast Send with On-Chain Memos & Privacy Masking

Send USDC natively on Arc with attached 32-byte hash identifiers and UTF-8 memo text via sendUsdcWithMemo().
Client-side privacy mode masks sensitive portfolio balances with post-quantum token placeholders (aps_pq_...).

3. 🔄 Instant Swaps & Bridge Routing

Dual Bridge Modes:
- Turbo (Gateway Instant): Sub-500ms cross-chain burn-and-mint settlement.
- Direct (CCTP v2): Canonical Circle cross-chain attestation transfer.
Slippage & Custom Recipient Protection: Built-in MEV protection and configurable tolerance (0.1%, 0.5%, 1.0%).

4. 🧮 Multi-Chain Liquidity Rebalance Wizard

Interactive scanner (GatewayRebalanceWizard.tsx) detects idle capital across all EVM networks and performs batch rebalancing to Arc in under 500 milliseconds.

🛠️ Tech Stack

Category	Technology
Smart Contracts	Solidity `0.8.24`, OpenZeppelin Contracts v5, Foundry (`forge`, `cast`)
Blockchain Target	Arc Testnet (Chain ID: `5042002`, Native Gas: USDC)
Frontend Framework	React 19, Vite 6, TypeScript 5.6
Web3 Libraries	Viem v2, Wagmi v3, TanStack React Query v5
Circle SDKs	`@circle-fin/app-kit`, `@circle-fin/unified-balance-kit`, `@circle-fin/user-controlled-wallets`, `@circle-fin/w3s-pw-web-sdk`
Styling & UI	Tailwind CSS v4, Lucide React, Web3Icons
Backend & Cache	Express API, Redis Cache (`ioredis`), EIP-712 Signature Handlers

🚀 Getting Started & Local Development

1. Prerequisites

Node.js (v18.0.0 or higher)
Foundry (curl -L https://foundry.paradigm.xyz | bash)
Arc Testnet USDC (Get from Circle Faucet)

2. Clone & Install Dependencies

# Clone the repository
git clone https://github.com/your-username/arcis-protocol.git
cd arcis-protocol

# Install frontend dependencies
npm install

# Install Foundry contract dependencies
cd contracts
forge install
cd ..

3. Environment Setup

Create a .env file in the root directory:

# Arc Testnet RPC
VITE_ARC_RPC_URL=https://rpc.testnet.arc.io
VITE_ARC_CHAIN_ID=5042002

# Circle API Keys (Optional for UCW & Dev Wallets)
VITE_CIRCLE_API_KEY=your_circle_api_key_here
VITE_CIRCLE_APP_ID=your_circle_app_id_here

# Deployer Private Key (For Foundry scripts)
PRIVATE_KEY=0x_your_private_key_here

4. Run Development Server

npm run dev

Open your browser and navigate to http://localhost:5173.

🧪 Smart Contract Testing & Deployment

Run Test Suite (100% Pass)

cd contracts
forge test -vvv

Executes unit and integration test suites covering StableSwapPool.t.sol, ConstantProductPool.t.sol, and YieldVault.t.sol.

Deploy Contracts to Arc Testnet

cd contracts

# Run Foundry broadcast script
forge script script/Deploy.s.sol \
  --rpc-url https://rpc.testnet.arc.io \
  --chain-id 5042002 \
  --broadcast \
  --slow

Verify Contracts on ArcScan

forge verify-contract <CONTRACT_ADDRESS> src/StableSwapPool.sol:StableSwapPool \
  --chain-id 5042002 \
  --verifier blockscout \
  --verifier-url https://testnet.arcscan.app/api/

📁 Repository Structure

arcis-protocol/
├── contracts/                       # Foundry Smart Contract Suite
│   ├── src/
│   │   ├── StableSwapPool.sol       # Constant-Sum AMM (USDC/EURC)
│   │   ├── ConstantProductPool.sol  # Constant-Product AMM (USDC/cirBTC)
│   │   ├── YieldVault.sol           # ERC-4626 Real Yield Vault
│   │   ├── mocks/MockERC20.sol      # Faucet-enabled Test Token
│   │   └── interfaces/              # Pool & ERC-20 Interfaces
│   ├── test/                        # Solidity Unit & Invariant Tests
│   └── script/Deploy.s.sol          # Arc Testnet Deployment Script
├── src/
│   ├── assets/                      # SVG Icons & Token Graphics
│   ├── components/
│   │   ├── pools/                   # PoolsTab, PoolCard, YieldCalculator,
│   │   │                            # GatewayRebalanceWizard, PoolActionModal
│   │   ├── privacy/                 # APS Privacy Toggles & Encryption Badges
│   │   ├── common/                  # SpeedFeeSelector, UI Components
│   │   ├── Header.tsx               # Top Navigation & UCW Profile
│   │   ├── UnifiedBalance.tsx       # Cross-Chain 13-Network Balance Aggregator
│   │   ├── SendModal.tsx            # USDC Send with Memo & Speed Tiers
│   │   ├── SwapModal.tsx            # AMM & App Kit Swap Interface
│   │   ├── BridgeModal.tsx          # Dual-Engine CCTP / Gateway Bridge
│   │   └── CircleAuthModal.tsx      # Social Login / Passkey WebAuthn
│   ├── config/                      # Arc Chain, Pools, Gateway & Fee Configurations
│   ├── hooks/                       # Web3, Gateway, Pools & Agent State Hooks
│   ├── services/                    # Viem Adapters, Gateway API, Memo & Swap Services
│   └── utils/                       # EIP-712 Encoders, History & Error Handlers
├── api/                             # Express / Redis Backend & Faucet Endpoints
└── README.md                        # Master Documentation

🔒 Security & Best Practices

Native USDC Decimal Alignment: Arc utilizes 18 decimals for native balance lookups and 6 decimals for ERC-20 interface interactions. Arcis contracts enforce rigorous 6-decimal fixed-point precision across all mathematical curves.
Reentrancy Protection: Critical state-mutating functions (addLiquidity, removeLiquidity, swap, redeem) implement OpenZeppelin's ReentrancyGuard.
Nonpayable Guarding: Explicit receive() functions reject unexpected native transfers to prep vent unbacked token lockups (unknown selectors are rejected by the default revert).
SafeERC20 Compliance: All token movements utilize OpenZeppelin SafeERC20 wrappers to guard against non-standard ERC-20 returns.

🔗 Useful Links & Resources

🌐 Arc Official Documentation: docs.arc.io
🔍 ArcScan Explorer: testnet.arcscan.app
💧 Circle Faucet: faucet.circle.com
📚 Circle App Kit Docs: developers.circle.com
🛠️ Foundry Book: book.getfoundry.sh

📄 License

This project is licensed under the MIT License — see the LICENSE file for details.

_{Built with ❤️ for the Circle & Arc Blockchain Ecosystem.}

Name		Name	Last commit message	Last commit date
.agents		.agents
.freebuff		.freebuff
.github/workflows		.github/workflows
api		api
contracts		contracts
public		public
scripts		scripts
skills		skills
smoke/ucw-echo		smoke/ucw-echo
src		src
.dockerignore		.dockerignore
.editorconfig		.editorconfig
.env.example		.env.example
.gitignore		.gitignore
.npmrc		.npmrc
.vercelignore		.vercelignore
AGENTS.md		AGENTS.md
DESIGN.md		DESIGN.md
Dockerfile		Dockerfile
README.md		README.md
index.html		index.html
llms.txt		llms.txt
package-lock.json		package-lock.json
package.json		package.json
server.ts		server.ts
skills-lock.json		skills-lock.json
tsconfig.app.json		tsconfig.app.json
tsconfig.json		tsconfig.json
tsconfig.node.json		tsconfig.node.json
vercel.json		vercel.json
vite.config.ts		vite.config.ts
vitest.config.ts		vitest.config.ts

Latest commit

History

Folders and files

Repository files navigation