chore: Bump babylon and fix pre-approval (#23)

* bump babylon and fix pre-approval

* fix pre-approval

* update changelog

* bump babylon

CHANGELOG.md

@@ -37,6 +37,12 @@ The format is based on [Keep a Changelog](https://keepachangelog.com/en/1.0.0/)
 
 ## Unreleased
 
+## v0.5.0
+
+### Bug fixes
+
+* [#23](https://github.com/babylonlabs-io/covenant-emulator/pull/23) Fix pre-approval flow
+
 ### Improvements
 
 * [#20](https://github.com/babylonlabs-io/covenant-emulator/pull/20) Add signing behind

clientcontroller/babylon.go

@@ -187,6 +187,10 @@ func (bc *BabylonController) QueryActiveDelegations(limit uint64) ([]*types.Dele
 	return bc.queryDelegationsWithStatus(btcstakingtypes.BTCDelegationStatus_ACTIVE, limit)
 }
 
+func (bc *BabylonController) QueryVerifiedDelegations(limit uint64) ([]*types.Delegation, error) {
+	return bc.queryDelegationsWithStatus(btcstakingtypes.BTCDelegationStatus_VERIFIED, limit)
+}
+
 // queryDelegationsWithStatus queries BTC delegations that need a Covenant signature
 // with the given status (either pending or unbonding)
 // it is only used when the program is running in Covenant mode
@@ -273,6 +277,7 @@ func DelegationRespToDelegation(del *btcstakingtypes.BTCDelegationResponse) (*ty
 		BtcPk:            del.BtcPk.MustToBTCPK(),
 		FpBtcPks:         fpBtcPks,
 		TotalSat:         btcutil.Amount(del.TotalSat),
+		StakingTime:      del.StakingTime,
 		StartHeight:      del.StartHeight,
 		EndHeight:        del.EndHeight,
 		StakingTxHex:     del.StakingTxHex,
@@ -351,12 +356,18 @@ func (bc *BabylonController) CreateBTCDelegation(
 	unbondingValue int64,
 	unbondingSlashingTx *btcstakingtypes.BTCSlashingTx,
 	delUnbondingSlashingSig *bbntypes.BIP340Signature,
+	isPreApproval bool,
 ) (*types.TxResponse, error) {
 	fpBtcPks := make([]bbntypes.BIP340PubKey, 0, len(fpPks))
 	for _, v := range fpPks {
 		fpBtcPks = append(fpBtcPks, *bbntypes.NewBIP340PubKeyFromBTCPK(v))
 	}
 
+	var inclusionProof *btcstakingtypes.InclusionProof
+	if !isPreApproval {
+		inclusionProof = btcstakingtypes.NewInclusionProof(stakingTxInfo.Key, stakingTxInfo.Proof)
+	}
+
 	msg := &btcstakingtypes.MsgCreateBTCDelegation{
 		StakerAddr:                    bc.mustGetTxSigner(),
 		Pop:                           pop,
@@ -365,7 +376,7 @@ func (bc *BabylonController) CreateBTCDelegation(
 		StakingTime:                   stakingTime,
 		StakingValue:                  stakingValue,
 		StakingTx:                     stakingTxInfo.Transaction,
-		StakingTxInclusionProof:       btcstakingtypes.NewInclusionProof(stakingTxInfo.Key, stakingTxInfo.Proof),
+		StakingTxInclusionProof:       inclusionProof,
 		SlashingTx:                    slashingTx,
 		DelegatorSlashingSig:          delSlashingSig,
 		UnbondingTx:                   unbondingTx,

covenant/covenant.go

@@ -120,9 +120,9 @@ func (ce *CovenantEmulator) AddCovenantSignatures(btcDels []*types.Delegation) (
 		// - CheckpointFinalizationTimeout
 		unbondingTime := btcDel.UnbondingTime
 		minUnbondingTime := params.MinimumUnbondingTime()
-		if uint64(unbondingTime) <= minUnbondingTime {
+		if uint32(unbondingTime) <= minUnbondingTime {
 			ce.logger.Error("invalid unbonding time",
-				zap.Uint64("min_unbonding_time", minUnbondingTime),
+				zap.Uint32("min_unbonding_time", minUnbondingTime),
 				zap.Uint16("got_unbonding_time", unbondingTime),
 			)
 			continue
@@ -374,7 +374,7 @@ func decodeDelegationTransactions(del *types.Delegation, params *types.StakingPa
 	}
 
 	// 2. verify the transactions
-	if err := btcstaking.CheckTransactions(
+	if err := btcstaking.CheckSlashingTxMatchFundingTx(
 		slashingMsgTx,
 		stakingMsgTx,
 		del.StakingOutputIdx,
@@ -404,7 +404,7 @@ func decodeUndelegationTransactions(del *types.Delegation, params *types.Staking
 	}
 
 	// 2. verify transactions
-	if err := btcstaking.CheckTransactions(
+	if err := btcstaking.CheckSlashingTxMatchFundingTx(
 		unbondingSlashingMsgTx,
 		unbondingMsgTx,
 		0,

covenant/covenant_test.go

@@ -67,7 +67,7 @@ func FuzzAddCovenantSig(f *testing.F) {
 			// generate BTC delegation
 			delSK, delPK, err := datagen.GenRandomBTCKeyPair(r)
 			require.NoError(t, err)
-			stakingTimeBlocks := uint16(testutil.RandRange(r, int(params.MinStakingTime), int(params.MaxStakingTime)))
+			stakingTimeBlocks := uint32(testutil.RandRange(r, int(params.MinStakingTime), int(params.MaxStakingTime)))
 			stakingValue := int64(testutil.RandRange(r, int(params.MinStakingValue), int(params.MaxStakingValue)))
 			unbondingTime := uint16(params.MinimumUnbondingTime()) + 1
 			fpNum := datagen.RandomInt(r, 5) + 1
@@ -80,22 +80,23 @@ func FuzzAddCovenantSig(f *testing.F) {
 				fpPks,
 				params.CovenantPks,
 				params.CovenantQuorum,
-				stakingTimeBlocks,
+				uint16(stakingTimeBlocks),
 				stakingValue,
 				params.SlashingPkScript,
 				params.SlashingRate,
 				unbondingTime,
 			)
 			stakingTxBytes, err := bbntypes.SerializeBTCTx(testInfo.StakingTx)
 			require.NoError(t, err)
-			startHeight := datagen.RandomInt(r, 1000) + 100
+			startHeight := uint32(datagen.RandomInt(r, 1000) + 100)
 			stakingOutputIdx, err := bbntypes.GetOutputIdxInBTCTx(testInfo.StakingTx, testInfo.StakingInfo.StakingOutput)
 			require.NoError(t, err)
 			btcDel := &types.Delegation{
 				BtcPk:            delPK,
 				FpBtcPks:         fpPks,
+				StakingTime:      stakingTimeBlocks,
 				StartHeight:      startHeight, // not relevant here
-				EndHeight:        startHeight + uint64(stakingTimeBlocks),
+				EndHeight:        startHeight + stakingTimeBlocks,
 				TotalSat:         btcutil.Amount(stakingValue),
 				UnbondingTime:    unbondingTime,
 				StakingTxHex:     hex.EncodeToString(stakingTxBytes),

go.mod

@@ -8,14 +8,15 @@ require (
 	cosmossdk.io/errors v1.0.1
 	cosmossdk.io/math v1.3.0
 	github.com/avast/retry-go/v4 v4.5.1
-	github.com/babylonlabs-io/babylon v0.12.0
+	github.com/babylonlabs-io/babylon v0.13.0
 	github.com/btcsuite/btcd v0.24.2
 	github.com/btcsuite/btcd/btcec/v2 v2.3.2
 	github.com/btcsuite/btcd/btcutil v1.1.5
 	github.com/btcsuite/btcd/chaincfg/chainhash v1.1.0
 	github.com/cosmos/cosmos-sdk v0.50.6
 	github.com/cosmos/go-bip39 v1.0.0
 	github.com/cosmos/relayer/v2 v2.5.2
+	github.com/decred/dcrd/dcrec/secp256k1/v4 v4.2.0
 	github.com/golang/mock v1.6.0
 	github.com/jessevdk/go-flags v1.5.0
 	github.com/jsternberg/zap-logfmt v1.3.0
@@ -91,7 +92,6 @@ require (
 	github.com/danieljoos/wincred v1.1.2 // indirect
 	github.com/davecgh/go-spew v1.1.2-0.20180830191138-d8f796af33cc // indirect
 	github.com/decred/dcrd/crypto/blake256 v1.0.1 // indirect
-	github.com/decred/dcrd/dcrec/secp256k1/v4 v4.2.0 // indirect
 	github.com/desertbit/timer v0.0.0-20180107155436-c41aec40b27f // indirect
 	github.com/dgraph-io/badger/v2 v2.2007.4 // indirect
 	github.com/dgraph-io/ristretto v0.1.1 // indirect

go.sum

@@ -273,8 +273,8 @@ github.com/aws/aws-sdk-go v1.44.122/go.mod h1:y4AeaBuwd2Lk+GepC1E9v0qOiTws0MIWAX
 github.com/aws/aws-sdk-go v1.44.312 h1:llrElfzeqG/YOLFFKjg1xNpZCFJ2xraIi3PqSuP+95k=
 github.com/aws/aws-sdk-go v1.44.312/go.mod h1:aVsgQcEevwlmQ7qHE9I3h+dtQgpqhFB+i8Phjh7fkwI=
 github.com/aws/aws-sdk-go-v2 v0.18.0/go.mod h1:JWVYvqSMppoMJC0x5wdwiImzgXTI9FuZwxzkQq9wy+g=
-github.com/babylonlabs-io/babylon v0.12.0 h1:s2OTcxpk0RzrkVBnVTfnPdJVYDSqnm/33YKPQqEzNCE=
-github.com/babylonlabs-io/babylon v0.12.0/go.mod h1:ZOrTde9vs2xoqGTFw4xhupu2CMulnpywiuk0eh4kPOw=
+github.com/babylonlabs-io/babylon v0.13.0 h1:h7cazmFmItePvZHEbLhDbsq2l7xN4e2AjDHRM7zDLkg=
+github.com/babylonlabs-io/babylon v0.13.0/go.mod h1:cxRwVqVLoJ39FpyovTEHJLu1lwwrM1tE8davu7nRHwY=
 github.com/benbjohnson/clock v1.1.0/go.mod h1:J11/hYXuz8f4ySSvYwY0FKfm+ezbsZBKZxNJlLklBHA=
 github.com/beorn7/perks v0.0.0-20180321164747-3a771d992973/go.mod h1:Dwedo/Wpr24TaqPxmxbtue+5NUziq4I4S80YR8gNf3Q=
 github.com/beorn7/perks v1.0.0/go.mod h1:KWe93zE9D1o94FZ5RNwFwVgaQK1VOXiVxmqh+CedLV8=

itest/e2e_test.go

@@ -5,27 +5,37 @@ package e2etest
 
 import (
 	"testing"
+	"time"
 )
 
 var (
 	stakingTime   = uint16(100)
 	stakingAmount = int64(20000)
 )
 
-// TestCovenantEmulatorLifeCycle tests the whole life cycle of a finality-provider
-// creation -> registration -> randomness commitment ->
-// activation with BTC delegation and Covenant sig ->
-// vote submission -> block finalization
+// TestCovenantEmulatorLifeCycle tests the whole life cycle of a covenant emulator
+// in two flows depending on whether the delegation is following pre-approval flow
 func TestCovenantEmulatorLifeCycle(t *testing.T) {
 	tm, btcPks := StartManagerWithFinalityProvider(t, 1)
 	defer tm.Stop(t)
 
-	// send a BTC delegation
-	_ = tm.InsertBTCDelegation(t, btcPks, stakingTime, stakingAmount)
+	// send a BTC delegation that is not following pre-approval flow
+	_ = tm.InsertBTCDelegation(t, btcPks, stakingTime, stakingAmount, false)
 
 	// check the BTC delegation is pending
 	_ = tm.WaitForNPendingDels(t, 1)
 
 	// check the BTC delegation is active
 	_ = tm.WaitForNActiveDels(t, 1)
+
+	// send a BTC delegation that is following pre-approval flow
+	_ = tm.InsertBTCDelegation(t, btcPks, stakingTime, stakingAmount, true)
+
+	// check the BTC delegation is pending
+	_ = tm.WaitForNPendingDels(t, 1)
+
+	time.Sleep(10 * time.Second)
+
+	// check the BTC delegation is verified
+	_ = tm.WaitForNVerifiedDels(t, 1)
 }

itest/test_manager.go

@@ -228,7 +228,34 @@ func (tm *TestManager) WaitForNActiveDels(t *testing.T, n int) []*types.Delegati
 	return dels
 }
 
-func (tm *TestManager) InsertBTCDelegation(t *testing.T, fpPks []*btcec.PublicKey, stakingTime uint16, stakingAmount int64) *TestDelegationData {
+func (tm *TestManager) WaitForNVerifiedDels(t *testing.T, n int) []*types.Delegation {
+	var (
+		dels []*types.Delegation
+		err  error
+	)
+	require.Eventually(t, func() bool {
+		dels, err = tm.CovBBNClient.QueryVerifiedDelegations(
+			tm.CovenanConfig.DelegationLimit,
+		)
+		if err != nil {
+			return false
+		}
+		return len(dels) == n
+	}, eventuallyWaitTimeOut, eventuallyPollTime)
+
+	t.Logf("delegations are verified")
+
+	return dels
+}
+
+// InsertBTCDelegation inserts a BTC delegation to Babylon
+// isPreApproval indicates whether the delegation follows
+// pre-approval flow, if so, the inclusion proof is nil
+func (tm *TestManager) InsertBTCDelegation(
+	t *testing.T,
+	fpPks []*btcec.PublicKey, stakingTime uint16, stakingAmount int64,
+	isPreApproval bool,
+) *TestDelegationData {
 	r := rand.New(rand.NewSource(time.Now().UnixNano()))
 	params := tm.StakingParams
 
@@ -284,14 +311,14 @@ func (tm *TestManager) InsertBTCDelegation(t *testing.T, fpPks []*btcec.PublicKe
 	require.NoError(t, err)
 	txInfo := btcctypes.NewTransactionInfo(&btcctypes.TransactionKey{Index: 1, Hash: btcHeader.Hash()}, serializedStakingTx, blockWithStakingTx.SpvProof.MerkleNodes)
 
-	slashignSpendInfo, err := testStakingInfo.StakingInfo.SlashingPathSpendInfo()
+	slashingSpendInfo, err := testStakingInfo.StakingInfo.SlashingPathSpendInfo()
 	require.NoError(t, err)
 
 	// delegator sig
 	delegatorSig, err := testStakingInfo.SlashingTx.Sign(
 		testStakingInfo.StakingTx,
 		1,
-		slashignSpendInfo.GetPkScriptPath(),
+		slashingSpendInfo.GetPkScriptPath(),
 		delBtcPrivKey,
 	)
 	require.NoError(t, err)
@@ -345,7 +372,8 @@ func (tm *TestManager) InsertBTCDelegation(t *testing.T, fpPks []*btcec.PublicKe
 		uint32(unbondingTime),
 		unbondingValue,
 		testUnbondingInfo.SlashingTx,
-		unbondingSig)
+		unbondingSig,
+		isPreApproval)
 	require.NoError(t, err)
 
 	t.Log("successfully submitted a BTC delegation")

tools/go.mod

@@ -4,7 +4,7 @@ go 1.21
 
 toolchain go1.21.4
 
-require github.com/babylonlabs-io/babylon v0.12.0
+require github.com/babylonlabs-io/babylon v0.13.0
 
 require (
 	cloud.google.com/go v0.112.0 // indirect

tools/go.sum

@@ -268,8 +268,8 @@ github.com/aws/aws-sdk-go v1.44.122/go.mod h1:y4AeaBuwd2Lk+GepC1E9v0qOiTws0MIWAX
 github.com/aws/aws-sdk-go v1.44.312 h1:llrElfzeqG/YOLFFKjg1xNpZCFJ2xraIi3PqSuP+95k=
 github.com/aws/aws-sdk-go v1.44.312/go.mod h1:aVsgQcEevwlmQ7qHE9I3h+dtQgpqhFB+i8Phjh7fkwI=
 github.com/aws/aws-sdk-go-v2 v0.18.0/go.mod h1:JWVYvqSMppoMJC0x5wdwiImzgXTI9FuZwxzkQq9wy+g=
-github.com/babylonlabs-io/babylon v0.12.0 h1:s2OTcxpk0RzrkVBnVTfnPdJVYDSqnm/33YKPQqEzNCE=
-github.com/babylonlabs-io/babylon v0.12.0/go.mod h1:ZOrTde9vs2xoqGTFw4xhupu2CMulnpywiuk0eh4kPOw=
+github.com/babylonlabs-io/babylon v0.13.0 h1:h7cazmFmItePvZHEbLhDbsq2l7xN4e2AjDHRM7zDLkg=
+github.com/babylonlabs-io/babylon v0.13.0/go.mod h1:cxRwVqVLoJ39FpyovTEHJLu1lwwrM1tE8davu7nRHwY=
 github.com/benbjohnson/clock v1.1.0/go.mod h1:J11/hYXuz8f4ySSvYwY0FKfm+ezbsZBKZxNJlLklBHA=
 github.com/beorn7/perks v0.0.0-20180321164747-3a771d992973/go.mod h1:Dwedo/Wpr24TaqPxmxbtue+5NUziq4I4S80YR8gNf3Q=
 github.com/beorn7/perks v1.0.0/go.mod h1:KWe93zE9D1o94FZ5RNwFwVgaQK1VOXiVxmqh+CedLV8=

types/delegation.go

@@ -1,9 +1,10 @@
 package types
 
 import (
-	"github.com/btcsuite/btcd/btcutil"
 	"math"
 
+	"github.com/btcsuite/btcd/btcutil"
+
 	bbn "github.com/babylonlabs-io/babylon/types"
 
 	"github.com/btcsuite/btcd/btcec/v2"
@@ -16,12 +17,14 @@ type Delegation struct {
 	// The Bitcoin secp256k1 PKs of the finality providers that
 	// this BTC delegation delegates to
 	FpBtcPks []*btcec.PublicKey
+	// The number of blocks for which the delegation is locked on BTC chain
+	StakingTime uint32
 	// The start BTC height of the BTC delegation
 	// it is the start BTC height of the timelock
-	StartHeight uint64
+	StartHeight uint32
 	// The end height of the BTC delegation
 	// it is the end BTC height of the timelock - w
-	EndHeight uint64
+	EndHeight uint32
 	// The total amount of BTC stakes in this delegation
 	// quantified in satoshi
 	TotalSat btcutil.Amount
@@ -52,14 +55,12 @@ func (d *Delegation) HasCovenantQuorum(quorum uint32) bool {
 }
 
 func (d *Delegation) GetStakingTime() uint16 {
-	diff := d.EndHeight - d.StartHeight
-
-	if diff > math.MaxUint16 {
+	if d.StakingTime > math.MaxUint16 {
 		// In a valid delegation, EndHeight is always greater than StartHeight and it is always uint16 value
 		panic("invalid delegation in database")
 	}
 
-	return uint16(diff)
+	return uint16(d.StakingTime)
 }
 
 // Undelegation signalizes that the delegation is being undelegated

types/params.go

@@ -8,9 +8,9 @@ import (
 
 type StakingParams struct {
 	// K-deep
-	ComfirmationTimeBlocks uint64
+	ComfirmationTimeBlocks uint32
 	// W-deep
-	FinalizationTimeoutBlocks uint64
+	FinalizationTimeoutBlocks uint32
 
 	// Minimum amount of tx fee (quantified in Satoshi) needed for the pre-signed slashing tx
 	MinSlashingTxFeeSat btcutil.Amount
@@ -52,9 +52,9 @@ type StakingParams struct {
 // MinimumUnbondingTime returns the minimum unbonding time. It is the bigger value from:
 // - MinUnbondingTime
 // - CheckpointFinalizationTimeout
-func (p *StakingParams) MinimumUnbondingTime() uint64 {
-	return sdkmath.Max[uint64](
-		uint64(p.MinUnbondingTime),
+func (p *StakingParams) MinimumUnbondingTime() uint32 {
+	return sdkmath.Max[uint32](
+		p.MinUnbondingTime,
 		p.FinalizationTimeoutBlocks,
 	)
 }