Certifying Findel derivatives for blockchain

• Published in: Journal of logical and algebraic methods in programming Vol. 121; p. 100665
• Main Author: Arusoaie, Andrei
• Format: Journal Article
• Language: English
• Published: Elsevier Inc 01.06.2021
• Subjects: Blockchain; Certification; Coq; Financial derivatives; Findel; Smart contracts; Coq; Smart contracts; Financial derivatives; Certification; Findel; Blockchain
• ISSN: 2352-2208
• DOI: 10.1016/j.jlamp.2021.100665

Findel is a composable DSL for financial derivatives that can be executed on the blockchain. The language is simple and expressive enough to express complex derivatives. However, compared to its competitors, Findel does not guarantee that contracts progress properly. There is no default refund mechanism, and the economic enforcement is not handled by the language itself. Given the immutability of the blockchain, more caution should be taken in order to avoid undesired situations. In this paper, we address the formal verification of financial derivatives written in Findel. We define a formal semantics of Findel in Coq and we test it against the existing Findel test suite. We enrich our semantics with means to interactively formalise and prove properties about Findel contracts. The goal is to avoid mistakes in Findel contracts that may have a negative impact (e.g., stuck contract executions, money losses). The derived infrastructure is used to certify non-trivial contract examples that cover the most common types of derivatives (forwards/futures, swaps, options).