1.3 Component Overview

The multi-chain DeFi vault system is architecturally segmented into distinct layers corresponding to policy, custody, and execution.

System Architecture

The following diagram illustrates the complete flow from policy decision to on-chain execution:

Complete Execution Flow

a. Strategy Import: CantonDeFi.com provides vetted, compliance-ready DeFi strategies that can be imported into your Canton policy layer

b. Signed Intent Issued: Canton's Daml contracts evaluate policy constraints, governance approvals, and risk parameters to generate a cryptographically signed execution intent

c. Prepare Transaction & Request Signature: The Relayer verifies the Canton intent, translates it into blockchain-specific transaction format, and requests final signature from MPC signers or local wallet

d. Broadcast Signed Transaction: The signed transaction is submitted to the target public blockchain network

e. Execution & Result: Smart contract vault verifies signatures against the Public Key Registry and executes DeFi operations (swaps, lending, staking) with the results returned

f. Reconciliation & Audit Log: The Relayer reports execution results back to Canton for state reconciliation, creating an immutable audit trail of the complete operation

Layer 1: Canton Domain (Daml Runtime)

This is the central policy and coordination plane. It stores sensitive data, including:

• Strategy rules
• Policy constraints (e.g., maximum exposure)
• Roles and permissions
• Approval records

Key Functions:

• Consumes private price and risk feeds
• Computes optimal allocation based on codified policy
• Emits cryptographically signed execution intents

Layer 2: Private Oracle Agents

These agents operate off-chain, fetching internal or proprietary data feeds necessary for strategy computation:

• Private risk scores
• Preferred pricing feeds
• Internal analytics data

Security:

• All data is cryptographically signed before delivery
• Delivered exclusively into the permissioned Canton environment
• Guarantees input provenance and authenticity

Layer 3: Bridge / Relayer (Adapter) Layer

The Relayer is the trust boundary component responsible for:

Intent Translation

Translating the signed ExecutionIntent from the private Canton ledger into verifiable, chain-specific transactions:

• Ethereum calldata
• Solana instructions
• Other blockchain formats

Verification

• Verifies Canton signature on the intent
• Prepares transaction for chosen custody layer
• Submits to target public chain

State Reconciliation

• Monitors transaction execution
• Reports results back to Canton
• Enables compensation logic for failures

Layer 4: MPC / Custodial Signers

This layer provides secure asset custody. It holds the vault's underlying asset keys.

Integration Patterns

Depending on the chosen integration pattern:

1. Co-signing: Co-signs transactions initiated by the Relayer
2. Direct Signing: Signs raw transaction data upon verified instruction from Relayer/Canton

Security Features

• Hardware Security Module (HSM) integration
• Key Management Service (KMS) support
• Multi-party computation for distributed signing
• Single-round signing protocols (MPC-CMP) for low latency

Layer 5: Public Smart Contract Vaults

These are minimal execution environments deployed on target public chains:

• Written in Solidity (EVM chains) or Rust (Solana, etc.)
• Expose simple interface for intent execution
• Contain modular adapters for DeFi protocols

Protocol Adapters:

• AMMs (Uniswap, SushiSwap, Raydium)
• Lending markets (Aave, Compound)
• Yield aggregators
• Liquid staking protocols

Example Interface

interface IRelayedVault {
    function executeIntent(
        bytes calldata intentPayload,
        bytes calldata cantonSig,
        bytes calldata proof
    ) external;

    function getNonce() external view returns (uint256);
}

Data Flow Summary

1. Policy Definition → Canton stores institutional policies
2. Strategy Computation → Canton computes optimal allocation
3. Intent Generation → Canton creates signed execution intent
4. Intent Relay → Relayer verifies and translates intent
5. Transaction Signing → MPC/custodian signs transaction
6. Execution → Public vault contract executes DeFi operations
7. Reconciliation → Results reported back to Canton