rwaUSD: Bridging

Bridging Assets to Get rwaUSD

To lower the risks and reach a needed level of regulatory compliance, Bridging is implemented to accept only well-known stablecoins such as USDT and USDC, ensuring a transparent and secure foundation for rwaUSD’s stability.

From the user's perspective, the whole process may appear seemingly straightforward:

1. The user sends their USDT/USDC to a Lumia bridge contract address on the source chain. From the user's point of view, they become effectively locked in the bridge contract.

2. The user proceeds to get a corresponding amount of rwaUSD from a Lumia bridge contract on the destination chain. The amount of rwaUSD to get is determined by the current value of the asset-rwaUSD ratio.

However, under the hood, the actual system design is much more intricate.

The added complexity is due to an innovative idea of users benefiting from multi-chain revenue streams without the complexity of interacting with multiple protocols and bridges directly.

Let's unveil the details!

Architecture

The following describes architecture and key features of the Lumia Smart Contracts, which manage staking pools, cross-chain asset handling, and contract upgrades.

The general idea of the product can be explained through a simplified user flow diagram:

User flow: User gets rwaUSD via bridging the supported assets

The system uses two or more Diamond Proxy contracts: one on the origin chain (such as Ethereum or Arbitrum) to manage deposits and revenue strategies, and another on the Lumia Chain to handle interchain communication, rwaUSD (RWA asset) generation, and revenue distribution.

Interaction: The underlying architecture of the rwaUSD: Bridging

Diamond Proxy Architecture

Lumia smart contracts is developed using the Diamond Proxy pattern:

• Modularity and Upgradeability: The architecture supports adding or replacing functionalities without affecting ongoing operations, ensuring flexible contract modularity.

• Second Diamond Proxy on Lumia Chain: The secondary Diamond Proxy operates on the Lumia Chain to manage cross-chain asset handling, effectively functioning as a bridge. It facilitates Hyperlane interchain messaging and ensures that rwaUSD tokens accurately represent real value. rwaUSD may acquire properties of liquid RWA assets, for example, in Tier 2.

Access Control List (ACL)

The Access Control List (ACL) defines roles like StakingManager , and VaultManager , each with specific permissions to manage different parts of the protocol. The DefaultAdmin role holds the authority to assign and revoke these roles, ensuring controlled access to critical functions. Additionally, the DefaultAdmin role is also responsible for managing proxy upgrades, allowing it to add, replace and delete specific contracts functionality.

Hyperlane Integration

Hyperlane plays a crucial role in facilitating cross-chain communication and managing RWA Assets within HyperStaking. The integration is based on a two-tier system that supports both traditional and liquid staking operations, as well as direct staking, which most closely resembles a bridge operation:

• directStaking: Direct staking allows users to stake assets directly on the Lumia Chain without needing to pass through the revenue strategy. This enables faster processing and more flexible staking options, while still maintaining cross-chain compatibility through Hyperlane’s messaging infrastructure. directStaking doesn't generate yield, it's for the situation when we want to bring some token fast and haven't implemented a yield strategy yet. For example, the user stakes 100 USDC on Ethereum. The staked USDC is locked in the Lumia Smart Contracts. The information about this action is used to mint 100 rwaUSD in the 1:1 ratio. Whenever the user wants their original assets back, they redeem the amount of rwaUSD initially minted for them and get their 100 USDC back.

• Tier 1: This tier is about maintaining the base infrastructure for traditional staking, but is deprecated and only mentioned in this documentation not to break the flow of narration.

• Tier 2: Deployed on the Lumia Chain, this tier manages liquid staking. When users stake assets, an interchain message is sent to mint rwaUSD—which acuiqres properties of a liquid RWA Asset—on the Lumia Chain, representing the revenue-generating assets linked to the strategy. These tokens are fully transferable, tradeable, and can be redeemed back to the originating chain. This architecture enables the Lumia Chain to collect revenue from assets on origin chains. The Tier 2 system ensures efficient interchain messaging, leveraging Hyperlane’s robust bridging capabilities. Users of liquid staking can only claim their original staked assets; the accumulated yield is separate and exists within the rewards pool and may be distributed through another mechanism. A good example of that is, again, when the user stakes 100 USDC on Ethereum. The information about this action is then bridged to Lumia and used to mint 100 rwaUSD — in 1:1 ratio. The staked 100 USDC are then used in a revenue strategy to gain higher yield than from traditional or direct staking. Whenever the user wants their original assets back, they redeem their rwaUSD on Lumia and get 100 USDC back on Ethereum.

Through this setup, users benefit from multi-chain revenue streams without the complexity of interacting with multiple protocols and bridges directly.

Handling Multiple Deposit Currencies

The Lumia protocol supports staking with both native assets (e.g., ETH) and ERC-20 tokens. In some cases, even NFTs are indirectly supported through certain strategies (e.g., Superform). This allows for flexible staking operations across different asset types.

• Native and ERC-20 Tokens: The protocol distinguishes between native chain coins (such as ETH) and ERC-20 tokens using the Currency struct:

  /**
  * The Currency struct represents a token
  * If `token` is address(0), it represents native coins (e.g. ETH)
  * @param token Address of the token, address(0) means native chain coin (e.g. ETH) */
  struct Currency { address token;
  }

• Strategy Flexibility: Each strategy can support different types of assets, including both native and tokenized assets. Strategies like Superform can even support NFTs indirectly by wrapping them in a compatible format.

• Unified Management: Despite supporting various asset types, the system maintains a unified interface for deposits, ensuring consistent behavior across different strategies and asset classes.

Revenue Strategies

Low-risk strategies are used to generate optimal income for stakers. All strategies implement a common interface, enabling seamless integration with staking pools and allowing new strategies to be added over time. The interface is defined in the IStrategy.sol contract and includes the following key functions:

/**
* The Currency struct represents a token
* If `token` is address(0), it represents native coins (e.g. ETH)
* @param token Address of the token, address(0) means native chain coin (e.g. ETH) */
struct Currency { address token;
}
/**
* @notice Allocates a specified amount of the stake to the strategy * @param stakeAmount_ The amount of stake received for allocation
* @param user_ The address of the user making the allocation
* @return allocation The amount successfully allocated
*/
function allocate( uint256 stakeAmount_, address user_
) external payable returns (uint256 allocation);
/**
* @notice Exits a specified amount of the strategy shares to the vault
* @param assetAllocation_ The amount of the strategy-specific asset (shares) to withdraw * @param user_ The address of the user requesting the exit
* @return exitAmount The amount successfully exited
*/
function exit(uint256 assetAllocation_, address user_) external returns (uint256 exitAmount);

This interface allows strategies to be deployed independently of the main upgradeable Proxy Diamond code and linked with new staking pools.

• Shares: Are emitted by the strategies and moved to the StrategyVault . These shares represent the user’s contribution in the strategy, (vault may potentially issue derivative tradable liquidity tokens). Specific strategies examples are detailed below.

The Main Implemented Strategy: SuperForm

The main strategy in the service implementation is SuperForm, where user's USDC are exchanged for SuperUSDC, which is the asset that generates a percentage of revenue APY.

Migrations

The Lumia protocol supports seamless strategy migrations to enable upgrades and rebalancing without disrupting staking operations. Underlaying assets can be migrated between strategies while preserving user positions and ensuring that the staked currency remains consistent.

Migration Process

• Direct and Yield Strategy Migration: The protocol supports migrating both direct-staking and yield-bearing strategies. Direct strategy migration transfers assets without minting new RWA tokens, while yield strategy migration withdraws assets from the source strategy and deposits them into the target strategy.

• Currency Consistency: Both the source and target strategies must use the same stake currency. If the currencies do not match, the migration is rejected.

• Cross-Chain Synchronization: Migration data is forwarded across chains, ensuring that cross-chain state remains consistent and that assets are correctly accounted for.

• Governance and Access Control: Migrations are restricted to the Migration Manager role, which can be transferred to a DAO through governance. This ensures that migrations remain secure and transparent under decentralized control.