• Every swap telegraphs size, timing, and direction; bots front-run and steal value.
• Yield products depend on closed vault teams, not market-wide competition.
• Liquidity providers in Hooks pools cannot invite external talent without giving away their edge.

AlphaEngine fuses Uniswap v4 hooks, EigenLayer AVS operators, and Zama confidential compute so that:

• Swaps become private by default — intents are encrypted, batched, and only a single net flow hits the chain, eliminating MEV extraction.
• Uniswap liquidity becomes market-driven — strategists submit encrypted intents that are simulated by our AVS and deployed if they outperform.
• Execution goes multichain without trust trade-offs — trades are verified on Ethereum (Sepolia) and forwarded to Base via the Nexus SDK with the same security and privacy guarantees.

In short, AlphaEngine lets performance — not privileged order flow — decide who wins.

• AlphaEngine Hook (UniversalPrivacyHook.sol): a Uniswap v4 hook that mints encrypted LP shares, collects swap intents, and exposes a secure strategy submission surface.
• Strategy Arena: strategists encrypt calldata (destination protocol, selector, args) and compete for capital allocation. The AVS simulates, ranks, and deploys the winners.
• EigenLayer AVS Network: a restaked operator set that decrypts intents under FHE permissions, nets flows, verifies strategy safety, and signs settlements.
• ZAMA Multichain via Nexus SDK: unified execution pipeline that originates trades on Ethereum Sepolia, verifies with the AVS, and dispatches aggregated payloads to Base Sepolia while preserving Ethereum-grade privacy.
• Frontend Experience (packages/site): connect wallet, mint test liquidity, track private batches, submit encrypted strategies, and watch multi-chain executions.

🔁 CypherTradeArena inspired our competitive strategy layer, but AlphaEngine goes further: winners actually deploy Uniswap hook liquidity under encryption, rather than scoring points in an isolated battle.

┌──────────────┐       ┌──────────────────────┐       ┌───────────────────────┐
│   Traders    │──────▶│ AlphaEngine Hook     │──────▶│ Encrypted Token Vault │
│ (LPs & Pros) │       │ (Uniswap v4 before/  │       │   (Hybrid FHERC20)    │
└──────────────┘       │  after swap hooks)   │       └───────────┬───────────┘
        │              └─────────────┬────────┘                   │
        │ Encrypted intents          │ Finalized batches           │
        ▼                            ▼                             ▼
┌──────────────────┐      ┌────────────────────┐        ┌─────────────────────┐
│ Frontend + SDK   │◀────▶│ EigenLayer AVS     │◀──────▶│ Nexus SDK Dispatcher │
│ (Zama clients)   │      │ (decrypt, match,   │        │ (Base / other L2s)  │
└──────────────────┘      │  simulate, settle) │        └──────────┬──────────┘
                                   │                                │
                                   ▼                                ▼
                        ┌─────────────────────┐        ┌────────────────────────┐
                        │ Net Hook Settlement │        │ Target Protocols (L2s) │
                        │ (Ethereum Sepolia)  │        │  Aave, Morpho, etc.    │
                        └─────────────────────┘        └────────────────────────┘

• Privacy wall: Users encrypt balances locally; only netted public flows touch the AMM.
• Competitive layer: Strategists share proofs of performance, not raw calldata.
• Cross-domain execution: Nexus SDK ferries AVS-approved payloads to Base while referencing Ethereum-origin attestations.

%%{init: {'theme':'dark', 'themeVariables': { 'primaryColor':'#00c2ff', 'primaryTextColor':'#fff', 'primaryBorderColor':'#00a7d7', 'lineColor':'#00c2ff', 'secondaryColor':'#ff6b6b', 'tertiaryColor':'#3700b3', 'background':'#111', 'mainBkg':'#1b1b1b', 'secondBkg':'#242424', 'labelBackground':'#242424', 'labelTextColor':'#fff', 'actorBkg':'#2f2f2f', 'actorBorder':'#00c2ff', 'actorTextColor':'#fff', 'signalColor':'#00c2ff', 'signalTextColor':'#fff'}}}%%
sequenceDiagram
    participant User as LP / Trader
    participant Frontend as Frontend + Zama SDK
    participant Hook as AlphaEngine Hook<br/>(Uniswap v4)
    participant FHE as Zama FHEVM
    participant AVS as EigenLayer AVS Operators
    participant Pool as Uniswap v4 Pool

    rect rgb(30,60,80)
        Note over User,Hook: PHASE 1 · Confidential Onboarding
        User->>Hook: deposit(token, amount)
        Hook->>FHE: mintEncrypted(token, amount)
        FHE-->>Hook: eToken handles
        Hook-->>User: credits encrypted balance
    end

    rect rgb(50,80,60)
        Note over User,AVS: PHASE 2 · Intent Collection (5-block epochs)
        User->>Frontend: request encryption session
        Frontend->>FHE: encrypt(amount, direction)
        Frontend-->>User: handles + inputProof
        User->>Hook: submitEncryptedIntent(handles, inputProof)
        Hook->>Hook: queue intent in epoch buffer
    end

    rect rgb(60,40,80)
        Note over AVS,Pool: PHASE 3 · Off-chain Matching & Settlement
        Hook->>AVS: finalizeEpoch(epochId, intentMerkleRoot)
        AVS->>FHE: batchDecrypt(handles[])
        AVS->>AVS: match opposing intents & compute net swap
        AVS->>Hook: settleEpoch(internalTransfers, netSwap, signatures)
        par Internal Transfers
            Hook->>FHE: burn/mint encrypted balances
        and Net Swap
            Hook->>Pool: swap(netUSDC, netUSDT)
        end
        Hook-->>User: updated encrypted balances
    end

    rect rgb(20,80,50)
        Note over User,Pool: RESULT · MEV-free swaps, zero IL on matched flow
    end

%%{init: {'theme':'dark', 'themeVariables': { 'primaryColor':'#a855f7', 'primaryTextColor':'#fff', 'primaryBorderColor':'#9333ea', 'lineColor':'#a855f7', 'secondaryColor':'#3b82f6', 'tertiaryColor':'#10b981', 'background':'#111', 'mainBkg':'#1b1b1b', 'secondBkg':'#242424', 'labelBackground':'#242424', 'labelTextColor':'#fff', 'actorBkg':'#2f2f2f', 'actorBorder':'#a855f7', 'actorTextColor':'#fff', 'signalColor':'#a855f7', 'signalTextColor':'#fff'}}}%%
sequenceDiagram
    participant Strategist as Strategist Wallet
    participant SDK as Zama Client SDK
    participant Manager as StrategyManager (Hook AVS entry)
    participant AVS as EigenLayer AVS
    participant Nexus as Nexus SDK
    participant Base as Base Sepolia Protocols

    rect rgb(30,50,90)
        Note over Strategist,Manager: STAGE 1 · Encrypted Submission
        Strategist->>SDK: encrypt(targetChainId, protocol, selector, args[])
        SDK-->>Strategist: handles[], proof
        Strategist->>Manager: submitStrategy(epochId, handles[], proof)
        Manager->>AVS: grantFHEPermission(epochId, strategyId)
    end

    rect rgb(40,80,60)
        Note over AVS,Nexus: STAGE 2 · Simulation & Ranking
        AVS->>Manager: fetchEncryptedStrategy(strategyId)
        AVS->>SDK: batchDecrypt(handles[])
        AVS->>AVS: simulate with vault snapshot (100k notional)
        AVS->>SDK: encryptAPY(result)
        AVS->>Manager: reportEncryptedAPY(strategyId, payload)
        Manager->>AVS: emit StrategyEvaluated
        AVS->>AVS: rank top strategies per epoch
    end

    rect rgb(80,60,40)
        Note over AVS,Base: STAGE 3 · Verified Multichain Execution
        AVS->>Manager: finalizeEpoch(winners, proofs)
        Manager->>Manager: aggregate calldata bundles
        AVS->>Nexus: requestDispatch(bundle, attestation)
        Nexus->>Base: relay aggregated calldata to target protocol
        Base-->>Manager: execution receipts
        Manager-->>Strategist: share encrypted performance rewards
    end

Key difference vs CypherTradeArena: AlphaEngine deploys actual Hook liquidity, not paper competitions. Strategists prove performance confidentially, win capital slots, and their calldata hits live DeFi rails once consensus is reached.

• Single source of truth: All trades originate on Ethereum Sepolia where the AVS verifies encrypted intents against the Hook state.
• EigenLayer-backed validity: Operator signatures attest to both the decrypted strategy parameters and the safety checks performed off-chain.
• Nexus SDK dispatch: Using Avail’s Nexus SDK, those attestations are packaged into cross-domain payloads. Base Sepolia executes only after verifying Ethereum-side proofs, so the privacy and correctness level matches Ethereum.
• ZAMA FHE everywhere: We extended ZAMA’s FHE toolchain to produce handles that remain valid across chains, enabling seamless encrypted state updates even after a cross-chain hop.

Result: ZAMA is now multichain — strategies are encrypted on Ethereum, routed to Base (or any Nexus-supported domain), and remain private end-to-end.

• Hook & Encrypted Tokens (packages/fhevm-hardhat-template/contracts/UniversalPrivacyHook.sol, HybridFHERC20.sol)

  • Collect deposits, mint encrypted LP shares, queue swap intents, settle net flows.
  • Exposes submitStrategyIntent entry point for strategists, enforcing epoch windows and collateralization.

• Strategy Manager & AVS (packages/fhevm-hardhat-template/contracts + AVS scripts in packages/fhevm-hardhat-template/avs)

  • Maintains epoch state, permissions, and aggregated performance reports.
  • Operators use Zama Gateway + EigenLayer middleware to decrypt, simulate, and sign settlements.

• Frontend (packages/site)

  • React / Next.js app using @zama-fhe/relayer-sdk.
  • Modules: encrypted faucet, LP dashboard, strategist submission wizard, Nexus dispatch monitor.

• Documentation & Specs

  • UEI_ARCHITECTURE.md – universal encrypted intents.
  • AVS_INTEGRATION_PLAN.md – restaked operator responsibilities.
  • MIGRATION_TO_ZAMA.md – steps taken to unlock Nexus-powered multichain.
  • FHENIX_ARCHITECTURE.md – FHE schema and permissioning model.

• Node.js v18+
• pnpm or npm
• MetaMask connected to Sepolia + Base Sepolia
• Sepolia ETH & Base Sepolia ETH (for gas)

git clone https://github.com/yourusername/fhevm-react-template.git
cd fhevm-react-template
npm install

# Configure contracts
cd packages/fhevm-hardhat-template
cp .env.example .env
# Populate MNEMONIC, INFURA_API_KEY / ALCHEMY_KEY, NEXUS_API_KEY

# Terminal 1 – local contracts (optional)
cd packages/fhevm-hardhat-template
npx hardhat node

# Terminal 2 – deploy to localhost or Sepolia
npx hardhat deploy --network localhost
# or
npx hardhat deploy --network sepolia

# Terminal 3 – frontend
cd packages/site
npm run dev
# open http://localhost:3000

1. LP onboarding – mint test USDC/USDT, deposit into the Hook, and verify encrypted balances.
2. Submit encrypted swap – watch it join the epoch queue and settle with zero MEV leakage.
3. Strategy submission – craft an intent targeting Base (e.g., lending on Aave), encrypt locally, and submit.
4. Operator simulation – track the AVS dashboard confirming decrypt → simulate → approve flow.
5. Nexus dispatch – inspect the cross-chain payload hitting Base and see the Hook’s liquidity put to work.

# Smart-contract tests
cd packages/fhevm-hardhat-template
npx hardhat test

# Helper tasks
npx hardhat task:check-balances --network sepolia
npx hardhat task:test-intent --amount 100 --network sepolia
npx hardhat task:finalize-epoch --network sepolia

# AVS operator harness
cd packages/fhevm-hardhat-template/avs
npm install
npm run simulate          # local decrypt + matching tests
npm run nexus:dispatch    # dry-run cross-chain payload

Operators can re-use the CipherTradeArena toolchain; AlphaEngine’s AVS bundle extends it with Hook-aware simulations and Nexus attestations.

• Expand Nexus destinations beyond Base (Linea, Scroll) while preserving FHE guarantees.
• Permissionless strategist onboarding backed by slashing conditions.
• Dynamic risk rails that auto-cap strategy exposure based on encrypted VaR metrics.
• zk attestations for on-chain proof that AVS verified simulations followed policy.

MIT © AlphaEngine Contributors

AlphaEngine transforms Uniswap hooks from passive AMMs into a confidential, competition-driven liquidity engine — ready for the next wave of private, multichain DeFi.