Assignment – Understanding the Blockzero Vortex

The Blockzero Vortex

This Mental Mining Assignment is everything about the Blockzero Vortex. It consists of three separate parts. At first we want to learn about what you, the community, already know and assume about the vortex. What is its purpose and how does it work? This is all about your own assumptions. In a second step we’d like to create a list of all the questions to be answered to fully understand the vortex. And finally we are exploring potential attack vectors and exploits.

  1. about what you know and what you assume
    We want to know what you think about the vortex. What do you know so far? How do you think the vortex works and how will it help Blockzero? (You may not have definite answers to these questions. Please share your assumptions from what you have heard about it so far?)

  2. about what you don’t know and have questions about
    Now, please ask questions. Which questions would you like to have answered to reach a deep level of understanding about how the vortex works? (Of course we intend to provide answers to all questions collected here. These will also be considered when creating a manual/documentation and the FAQ for the vortex.)

  3. about potential attack vectors and exploits
    Please think about ways how the vortex could be exploited? Most of the bug testing done so far (including the first testnet competition) has been focused on usability. Even if a protocol works as intended it is possible people come up with creative ways of (mis)using it. In this step we ask you to brainstorm all ideas how an attacker could break the vortex or use it to harm blockzero. Please don’t hesitate to share ideas you think are absurd. Others might be inspired by them and evolve them into something feasible.

Here are some additional resources about the vortex. Some information might be outdated. For those new to our ecosystem this might help understand what everything is about:

Please be aware that we have also have a thread on discord belonging to this discussion. When allocating the rewards (following coordinape epoch) make sure to account for all contributions you have witnessed adding value to this assignment. We encourage cross posting! But also consider that the best discussions evolve when you relate to others by answering their questions or adding arguments to their points.


This assignment will be active for seven days, i.e. Thursday, December 30th. Then we will start the coordinape allocation epoch. As always this will be part of the assignment. So if you want to earn your share of the 10,000 XIO total reward allocated please make sure to register using the typeform if you have not done so before.

Find an introduction to the Mental Mining Missions here.


And Merry Christmas to all of you!

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Merry Christmas BZ fam, I hope you all have an epic day!

  1. about what you know and what you assume

The Vortex is a way for XIO holders to derive value from multiple accelerated (internal) and externally supported projects simultaneously by staking XIO to earn APY from multiple projects at once.

This is intended to provide direct value for XIO holders and thus incentivize the buying and staking of XIO. This will also promote BZ citizens getting involved in the externally supported project through mental mining or other activities as we will have a direct stake in that projects success through the staking mechanism.

  1. about what you don’t know and have questions about
  • What is the current timeline to launch assuming no changes are required after the testnet?
  • What is the current timeline to move to an efficient layer 1 (Avalanche) or layer 2? I think this is essential for majority participation and value creation.
  • What projects are we looking to externally support once the vortex is live? Do we have any lined up?
  • Will staked XIO still allow the user to earn tokens for internally created BZ projects ($KIND etc)?
  1. about potential attack vectors and exploits

I’m not overly technical so I will keep this short!

  • Human vector. Phishing/virus/social engineering to obtain private key information of vortex owner(s).
  • Contract faults/outdated libraries/external resources.

Happy Holidays :grinning:

2 Likes

Merry Christmas Crew! :santa:

The VORTEX is BlockZero’s BANK. It’s operating like a DAO and has 3 layers/orbits:

  • O1.Treasury - which provides funding to BlockZero’s ecosystem (operations, development, missions, etc. )

    • current model allows only council members to vote for allocating funds from a multisig wallet
    • i assume when The Vortex will be Live the current model will be adjusted, in order to become a true DAO voting rights needs to go to all participants
  • O2.Liquidity - which provides liquidity to XIO

    • current model rewards only providing Liquidity or Holding the XIO, staking is not possible…
    • The Vortex will change this model, and will reward STAKING XIO with different tokens that will be deposited in this orbit.
  • O3.Collateral - which provides backing to XIO

    • atm there is no backing
    • The Vortex will allow new projects to deposit funds in this orbit and will use the value of these tokens as a collateral for the XIO value.
    • when the Token value is higher then XIO value you can burn XIO to get the Token
    • when the Token value is lower then XIO value you keep the XIO STAKED in O2 to get more Tokens
  • will Vortex be deployed on Ethereum or Avalanche?
    i know we spoke about this so many times, but guys my recent experience with 2 other DAO’s … one crossed from ETH to AVAX and the other one directly opened in AVAX… it’s FANTASTIC , it’s a difference from Earth to MOON, so fast and so cheap … you don’t need to have a lot of capital to be profitable. i don’t see how someone with less than 10k capital can make a profit in an ETH DAO … unless there is like a 3B APY …

  • can the NFT’s be staked in Vortex?

  • can single tokens (XIO, AQUA … ) be staked or we’ll need only XLP’s?

  • can Portals be created by anyone? or will be a selection mechanism in place?

  • does a new project that’s being accepted to enter in the Vortex need to deposit part of it’s “fee” tokens in O2 and part in O3 ? or the funds are all together in the same “pool”?

  • one of the problems might arise if in the vortex are allowed to many low value/no potential projects
  • sounds strange, but even too many good projects at once might be an issue :slight_smile:
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First, Happy Holidays to everyone! Also, I would like to apologize for my slow learning curve. I work full time as a Medical Dosimetrist, and that takes up almost all of the brain power that I have left at 51 y/o :sweat_smile:

I know it has 3 “orbits” - 1 for voting, 1 for staking (LP), and 1 for burning XIO. I assume that the voting and LP orbits are pretty much active, but we need more collateral for orbit 3 to really work.

I would like to know if we have (or will have) a page dedicated to voting for proposals.

The only (probably absurd) exploit that I can think of is on the human side. Someone could portray themselves as a rep for a legit crypto project and try to get some XIO and disappear.

From the article and information I know:
Vortex consists of three orbits:

  • Treasury where funds can only be used by council members majority vote.
  • Liquidity, will be used to provide liquidity and sustainability to XIO token.
  • Collateral, providing resources to support projects by collateralising the value of XIO token.

My assumption is that the vortex is the solution to stabilise and increase the functionality and value of XIO in general. It will bring structure to DAO element of Blockzero. Burning or staking the XIO token for getting other tokens will reduce the supply of XIO from circulation. And it will be attractive to burn XIO to get multiple tokens in future. And while staking the value of underline token and XIO will also be increasing. The only drawback I see is that in current situation we only have to hold XIO to earn other tokens rather than staking and if we ETH fees remain same staking will be a difficult decision for some if not most of the citizens.

  • Are the orbits interconnected, like can treasury tokens be staked?

  • Will the Cryptonauts funds will be added to treasury?

  • Will there be community vote or discussion before using treasury funds besides operational?

  • Will there be cooldown period for unstaking in Orbit 2?

  • Is there any plan to increase the eligible tokens to stake besides XIO and XLP?

  • If a person stakes the LP tokens in Aqua, can they stake those tokens in vortex or its one or the other?

  • Will the burned XIO tokens will be burned or just moved somewhere else?

Besides human error, which will not be BZ problem.

  • Taking advantage of price fluctuations.

  • Burning XIO if the price difference is too much.

  • Taking advantage of gas fees on eth, compared to those who can’t afford it.

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Human errors are underestimated, there are new techniques for social engineering. But projects can never be responsible for it. Most they can do is either put a warning pop-on for phishing (link) or write an article about security.
There is already an acknowledgment on drop zero, something like that can be mimicked to help people.

Wont the projects with low value just be cherry on top, because the staker will still be earning high value projects.

I agree, if that happens there will be too much noise to sift through.

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1. About what I know and what I assume

It is index fund. Some kind of middleman between investors and startups. People can invest/interact into/with Vortex Fund with voting, staking, burning, these actions are tools to remove tokens from specific orbit.

2. About what I don’t know and have questions about
What doesnt make sense is how will the vortex get the funds? or how will it function if it funds get depleted? if vortex gets many startups this will skyrocket and the XIO would be burning and high rates? do startups provide their own tokens in exchange for xio community to fund them and get value from startup? what incetivizes users to hold/stake/provide LP?

3. about potential attack vectors and exploits
If my assumption for startups to provide their own tokens that could mean there could be scam tokens provided into vortex?

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i would assume yes … most probably Vortex will completely replace the current way of getting this “internal project rewards” … at list i hope it will not be a dual system or otherwise it will be too confusing.

Happy Holidays, and welcome to the Crew … don’t worry everyone here is learning :slight_smile:

i think will depend on the ratio goodProjects/badProjects… but on the other hand, i think all XIO rewards will move as well to Vortex, so even if all projects have low value… at least we get XIO LP & Staking rewards

Vortex will get internal funds (XIO) from Blokzero to reward XLP staking … and external funds (start-up tokens) so that start-ups will use BlockZero infrastructure and they will have to pay like a “fee” … these tokens will go to Vortex and will rewards the LP’s/Stakers

which makes your last assumption legit … projects need a pre-vetting before will go to voting … and after the vetting each project needs a solid presentation before goes to voting … at least we can filter a bit the potential scams

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1. About what you know and what you assume

Vortex is a fund management and disbursement system for XIO. Council can control the treasury, Users can provide liquidity/stake and earn new tokens in return, Users can provide collateral by burning the tokens and get the collateral in return.

2. About what you don’t know and have questions about

The entire share/fee from the new projects will be in Orbit 2 and 3 or share will also go in orbit 1 (Treasury)?

The new projects created by BZ, without holding how the treasury will gets it share, pre-decided?

Will Cryptonaut be useful in Vortex?

If cryptonauts cant be staked, will it be useful to keep XIO locked in them? What will stop people from loading up their cryptonauts rather than staking?

3. About potential attack vectors and exploits

Staking and burning the tokens if token price exceeds XIO.

Contract exploits.

Honey pot with new portals

New projects removing liquidity after adding tokens to vortex

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Merry Christmas to you all

From what I understand ( and correct me if I’m wrong ), the vortex is similar in way to Autofarm, Beefy finance or polkastarter where users would stake XIO to earn new token.

I know there are three orbit to use the vortex; treasury, liquidity and collateral each has its own purpose and mechanisms to distribute project token.

I’m assuming a project A give info about their project and choose the orbit they want from the citizens or BZ council to vote, stake or burn xio to get their token. ( I’m not 100% sure if they can choose the orbit or not. And again correct me if I’m wrong )

Some good questions already asked like will vortex be use on Avalanche too or only etherume? And do we have any project out side BZ to support the vortex?

My questions

  • will the project choose the orbit they want?

  • when users stake xio on orbit 2, will they able to unstake any time or depending on the project choice? On same question, will the project would have different times to stake xio? E.g. user can choose to stake for 1 month, year, 5 years etc.

  • when the project will have the funds, does it goes immediately to project address or reviewed by the council member first to prevent from scam project?

  • what if there is scam project and managed to get some citizens to stake/burn xio and run away, how the vortex deal with that ?:sweat_smile:

1- honeypot token or something similar ( e.g the contract able user to stake but unable to unstake after the time period end)

2- attacker could create portal in vortex and stake/burn in the same portal to attract more people ( same idea happened on Beefy finance)

As for what I believe the vortex is, I think it is a staking portal very similar to what other platforms already do such as pancakes or sushi swaps where Tokens are deposited in pools and specific coins are received as rewards in the form of other Tokens. what you will do in the vortex, most likely will be staking xio Tokens to get, as a reward, several other tokens that other projects will make available in the Vortex.

regarding my questions the main one is what will the %APR be and if there will be any linear vesting or vesting at all (rewards locked for a period of time etc…). Also, what chain will it be on? Eth only? I hope it will be on cronos and bsc as well since those are the easiest to use for me.

Potential risks? Only specific hacks come to mind like flash loan attacks and vulnerabilities in the code and I have no expertise is the field to actually have an input here…we should have some certik and other security companies audits before launching.

If I am not mistaken li once read that you could only choose between some projects and not ll at once. As if you have a potential APY and you have to split it into those projects

A BANK???:cold_sweat: WE DON’T use that word here in the crypto space! :joy:

Wait, where did you read that the vortex burns xio?

99% chance that the vortex will be on other chains and L2 solutions to mitigate gas fees

I never thought of it like that…an index fund is a nice comparison

Nice, you made me think about another question… Will the cryptonauts game linked to the vortex? It would be awesome if there could be some kind of interaction

Could you please expand on this type of attack?it is the first time I hear it

Knowing the history of BZ team, there wont be many. I think mental mining and test net will still be distributed via dropzero.

I dont think that honey pots can/will reach to BlockZero.

well its been long hearing that. I guess we will have to see. But it should be done before relaunching Flash.

Tokens will be in Vortex portal, which is created by BZ. So the rewards will be distributed. Value of those tokens will be different story.

Hi JMG, nice to have u here

I think this should be a question … will it be possible for new projects to remove their liquidity?

reading this, another question comes to mind … Will BZ use the “fee” paid by a new project for both O2 and O3 in equal/different percentages?

if you are right, then is not an index fund is it?
but until now BZ said everywhere that :
“Staking $XIO gives you exclusive rewards and drops from all the projects we create or accelerate”

I’ve seen Banks that weren’t just Banks :martial_arts_uniform: :)))

but if you have an institution (and even a DAO is one) that has a treasury which is collateralized and used to fund other projects/people who in return pay a fee/interest … you can call it anything you like … but there is no escape Mr. Anderson :rofl: :rofl:

i think Jay was referring to the orbit3 where people can burn XIO to receive the projects token … vortex will not burn XIO

It’s type of token contract which allow you to buy/swap the honeypot token then you can’t sell it so you stuck with it and the attacker run away with the eth which you buy it with. But it’s not related to vortex as Gasser clarify it:

And I’m assuming the projects will be reviewed with their token smart contract as well

Thanks, it’s good to be here.
You are right actually, all the projects till now are created by BlockZero Labs and I do not know what BlockZero did for UMA or vice-versa. If that continues to happen we are not having any problem. But if new projects will be entering, where development and contracts will not be in BlockZero’s control, than we can ask this question again.

I get that, but there are various types of Honeypots. It will not be smart to omit them completely.

Game? I don’t know about that but sounds exciting.

  1. about what you know and what you assume
    We want to know what you think about the vortex. What do you know so far? How do you think the vortex works and how will it help Blockzero? (You may not have definite answers to these questions. Please share your assumptions from what you have heard about it so far?)

So far I know there is three orbits to the vortex:
where persons are being collaterize for there efforts
Where you can earn multiple tokens by staking your xio token or providing liquidity
Where you can burn your xio tokens to earn tokens

  1. about what you don’t know and have questions about
    Now, please ask questions. Which questions would you like to have answered to reach a deep level of understanding about how the vortex works? (Of course we intend to provide answers to all questions collected here. These will also be considered when creating a manual/documentation and the FAQ for the vortex.)

Will the vortex be able to operate on multiple chains?
Will it need to work on a L2 solution?
What happens if there are no tokens in the vortex?
Why would persons want to put there tokens in the vortex?
Why would I want to burn my xio for other tokens?
Will the contract coding be verified?
What happens to my token when I stake them?
How will the reward for staking a token be calculated?
Will this be like a dex?

  1. about potential attack vectors and exploits
    Please think about ways how the vortex could be exploited? Most of the bug testing done so far (including the first testnet competition) has been focused on usability. Even if a protocol works as intended it is possible people come up with creative ways of (mis)using it. In this step we ask you to brainstorm all ideas how an attacker could break the vortex or use it to harm blockzero. Please don’t hesitate to share ideas you think are absurd. Others might be inspired by them and evolve them into something feasible.

What is there to prevent a person from gaining access to all tokens in the vortex and withdraw it all?
Can a burn cause a person to access all tokens in that orbit?
Persons might capitalize on arbitrage after burning xio, by staking

Well i guess that is the first thing the audits will cover. Like the number 1 item on the list

1. About what you know and what you assume

I don’t know much to be honest here. I know that it’s some kind of an staking thing where you can earn rewards with XIO. I assume that the Vortex works as any staking system and as with any rewards the point of these things most of the time is to attract new users and to keep old ones invested in the project by rewarding them.

2. About what you don’t know and have questions about

  • As I have now read that you can earn multiple rewards simultaneously with it so my question is how are the APY percentages determined?

  • When will it be launched?

  • We can see some on the pictures but what projects is it going to support?

  • Is there a minimum amount of XIO that you have to stake to be eligible for the rewards?

  • Is there a lockup period?

3. About potential attack vectors and exploits

Really hard to think of anything since staking seems to be kinda fool proof. I can think of reputation damage if the projects fail (not really up to BZ), slashing, price falling rapidly during the lock-up period (if there’s one). That’s it :smiley:

Well i can cite pancakebunny that got all of their staking pools drained Not always fool proof

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