[CRITICAL][Tier-A] Cross-chain Merkle-Patricia proof verification for EVM HTLC reveals

[jotel-dev]

Tier
Tier A · CRITICAL — Cryptographic cross-chain verification (not a full light client).

Context
contracts/atomic-swap/src/lib.rs implements verify_merkle_proof as a SHA-256 hash stub (env.crypto().sha256(&log_data)). The relayer (apps/relayer/src/evm-htlc.ts) passes secrets from Soroban released events to the EVM leg without proving the EVM log actually exists. A malicious relayer can fabricate secrets that pass this stub and drain the counterpart HTLC.

Goal
Replace the stub with deterministic Merkle-Patricia Trie (MPT) inclusion verification inside the Soroban contract. The relayer must submit an EVM log proof alongside the secret, and the Soroban contract must verify it against a trusted EVM block header root before accepting record_evm_reveal.

Non-goals
No full EVM execution client inside Soroban.
No BLS/SNARK wrapping of the MPT verification (gas-costly).
No RPC calls from inside the contract — proofs are submitted by the relayer.

Data model
Add to DataKey in AtomicSwapContract:

• VerifiedEVMBlock(u32) -> (block_hash, header_root, verified_at_ledger) per EVM chain ID.

Implementation plan

1. Add an MPT verification module under contracts/atomic-swap/src/mpt.rs that traverses a Merkle-Patricia path for an EVM log topic/value against a provided root using only Soroban host crypto.
2. Modify record_evm_reveal to accept (evm_tx_hash, secret, evm_block_height, chain_id, mpt_root, mpt_proof_bytes).
3. Before storing CrossChainTxInfo, reconstruct the MPT node path from mpt_proof_bytes and assert it reaches mpt_root.
4. Gate on a previously verified block header: the relayer must first call a new verify_evm_header(chain_id, block_number, header_rlp, header_proof) that stores the header root. record_evm_reveal then uses the most recent verified root for that chain.
5. Update apps/relayer/src/evm-htlc.ts to fetch eth_getProof for the HTLC log and submit the MPT proof to Soroban.
6. Add contracts/atomic-swap/src/mpt_test.rs with property tests for known MPT fixtures.

Thresholds

• InsufficientFinality (12) must also fire when record_evm_reveal is called with a block whose header is unverified.
• Reorg buffer remains MAX_REORG_WINDOW_LEDGERS = 50.

Acceptance criteria

• verify_merkle_proof no longer exists as a SHA-256 stub; the compiler rejects any caller passing raw log_data without an MPT proof.
• A red-team fixture (forged MPT proof) is rejected by record_evm_reveal.
• The relayer successfully processes a real LogHTLCWithdraw from Goerli/Sepolia using an ethers-generated MPT proof.
• get_events on the Soroban RPC still decodes released correctly; no breaking change to decodeReleasedEvent.

Related files

• contracts/atomic-swap/src/lib.rs
• contracts/atomic-swap/src/relayer_integration.rs
• apps/relayer/src/evm-htlc.ts
• apps/relayer/src/soroban-watcher.ts
• apps/api/src/lib/stellar.js
• contracts-evm/HTLC.sol

Contributor notes
Keep the MPT verifier pure and exhaustively tested against hard-coded test vectors — this is the only path to staying Tier A. Soroban host crypto is limited; if MPT is too expensive, use a precompile-style batching of node hashes rather than one big proof.

telegram link : t.me/nullifiersystem

[Guddy0101]

Hello Maintainer @jotel-dev!!!!!
This issue is something i can resolve, Please do assign it to me so i can fix it, Thank you.

[grantfox-oss]

🦊 GrantFox — @Guddy0101 has been assigned to this issue as part of the Third Campaign campaign!

Next steps:

1. Open a Pull Request referencing this issue (e.g., Closes #386)
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