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Deposit & withdraw flows

Deposits move tokens from a public wallet into a private virtual account. Withdrawals move them back out. These are the two points where value crosses between the public token and its private form.

Deposit​

A deposit follows the same five steps as any Merces action:

  1. Proof generation, client-side. The client splits the deposit amount into additive secret shares, encrypts each to the corresponding MPC operator's public key, and generates a Groth16 proof that the shares are consistent with the committed amount. This step is fully local.
  2. Submission. The client sends the proof and ciphertexts to the gateway over WebSocket; the gateway constructs and submits the deposit transaction to the Merces contract. Alternatively, the client can post the encrypted transaction details directly to the contract.
  3. Onchain verification. The contract verifies the Groth16 proof, records the new commitment, and emits an event signalling the MPC network to pick up the queued action.
  4. MPC balance update. The operators jointly decrypt the ciphertexts to recover the deposit amount, update the user's secret-shared balance, and generate a second Groth16 proof that the update is correct. They call processMPC() on the contract with the proof and updated commitments.
  5. Finalisation. The contract verifies the MPC proof and commits the new balance state. The transaction hash returns to the client either through the gateway or is directly queried from the contract.

Withdraw​

A withdrawal follows the same structure in reverse: the client proves entitlement to the amount, the contract verifies and queues the action, the MPC network debits the secret-shared balance and proves the update, and the contract releases the token back to the public wallet.