What is Sarcophagus.io?
A dead man’s switch is a mechanism that triggers when a user fails to perform an action. This idea of requiring user input to continue operation of machinery has become a staple in all potentially dangerous operations. One current example is the handle or lever that needs to be pulled down to use a lawn mower. When the user lets go of the lever, a signal is sent to stop the engine and the lawnmower stops working. Now that the internet has become arguably one of the most useful, yet dangerous human inventions, Sarcophagus.io has created a decentralized dead man’s switch that runs on Ethereum and Arweave.
Many readers should be familiar with Ethereum by now, but Arweave is still growing its popularity within web3. Arweave is a decentralized network that describes itself as a “perma-web,” which looks like the normal web, but all of the content is permanently hosted on the decentralized Arweave web. The network is community-owned where anyone can contribute to it or get paid to maintain it. It relies on its native Arweave Tokens to facilitate the hosting of content.
Before the Sarcophagus protocol can be explained, the different roles and terms used within the white paper must first be understood:
Sarcophagus: The sarcophagus can be any type of file that sits on the Arweave network. The sarcophagus is the “dead man’s switch.” It consists of two layers of encryption. Think of it as the protected payload.
Embalmer: The Individual who creates the sarcophagus, thus deciding who receives the data within the sarcophagus and when the sarcophagus is to be decrypted. Think of them as simply the creator.
Archeologist: Archeologists make money by charging higher rates than it costs them to host the data on Arweave, pay ETH for contracting fees, and to resurrect the sarcophagus. They are responsible for decrypting the first level of encryption, leaving the data with one level of encryption to be decrypted by the recipient. Think of them as the contractors paid to manage the sarcophagi.
Recipient: The recipient is the individual whose Ethereum keypair decrypts the second layer of encryption once the archeologist has decrypted the first layer. They are the end destination for the data within the sarcophagus.
Sarco Token: The Sarco Token is an ERC20 token that is the primary unit of exchange on the sarcophagus network. It is used by the embalmer to pay for the creation of a sarcophagus, and by the archeologist to post their bond, an incentive mechanism to prevent archeologists from opening the sarcophagus early, otherwise their bond is slashed.
With the roles defined, the best way to understand the protocol is a full walk-through of creating a sarcophagus and following it through until it’s resurrection. First is the “mummification phase,” where an embalmer names their sarcophagus and uploads the data. The data can be any file type, so long as it is smaller than 2.9 megabytes. Next, they would enter the recipient’s full Ethereum public key and choose a resurrection time. The embalmer then chooses an archeologist to “curse” once the bounty and digging fees offered by an embalmer meet the archeologists' minimum requirements. Once an embalmer “curses” an archeologist, the archeologist is responsible for the sarcophagus, and the bounty and digging fees are locked up.
The bounty is the final sum paid to the archeologist when the sarcophagus is correctly “resurrected.” The digging fees are payments made to the archeologist that are guaranteed upon “re-wrapping” to make up for the illiquidity of the bond posted by the archeologist. Archeologists are required to post a bond, which is the sum of the digging fee and bounty multiplied by the reserve requirement to act as an incentive to correctly resurrect the sarcophagus. Currently the reserve requirement is 10%, but may raise up to 100% in 10% increments based on the frequency of rogue archeologists, who decrypt sarcophagi at incorrect times. All bounties and digging fees are paid with the Sarco Token. Both the resurrection and re-wrapping phases will be discussed later in the article. An embalmer can also pay above the archeologists minimum fees to incentivize successful resurrections from archeologists. In the final step of the mummification phase, the embalmer uses the public key of the cursed archeologist to encrypt the outer layer of the sarcophagus. This allows the archeologist to use their public key to decrypt the outer layer at resurrection time.
Following the Mummification phase is the optional Re-wrapping Phase. If the embalmer wants to change the bounty or resurrection time, they can re-wrap the sarcophagus before the currently set resurrection time. If they want nothing to change, they can just leave the sarcophagus and it will be decrypted at the said resurrection time. The embalmer can set the updated resurrection time to anytime in the future, which can be earlier or after the current resurrection time, so long as the time is still under the archeologists max resurrection time. Similarly, the embalmer can also increase or decrease the bounty fee, so long as it is still above the archeologist’s minimum. After each re-wrapping, the previous digging fees are released from the curse contract and paid out to the archeologist, while the embalmer must provide new digging fees. Many times, the re-wrapping will stick with the initial resurrection time and bounty, just as an action to attest to their liveliness. Sarcophagi can never be destroyed, they can only be locked away forever to ensure the sarcophagus is never opened. To do this, the application allows an embalmer to re-wrap a sarcophagus with no bounty or digging fees, as long as the resurrection time is further in the future than the archeologist’s maximum resurrection time.
The final step is the Resurrection Phase. If an embalmer does not continuously re-wrap a sarcophagus, the time comes for the resurrection. The archeologist decrypts the outer layer of the sarcophagus, unlocking the posted bond, bounty, and final digging fees for themselves. The archeologists’ job is now completed for that individual contract. The Recipient can then use their Ethereum keypair to decrypt the final encryption layer, and reveal the data within the sarcophagus. The archeologist only receives the bounty payment if they resurrect the sarcophagus between the stated time of resurrection and the grace period given to complete the process, which incentivizes the archeologists to track all the resurrection times of the sarcophagi cursed to them. The grace period is currently around 1 hour, with this to be finalized in V2. Otherwise, if the archeologist opens the sarcophagus too early or too late, they are slashed their full posted bond, the digging fees are burned, and the bounty is returned to the embalmer. The recipient key can be privately stored or publicly posted, meaning the information within the sarcophagus may be something that someone wishes to be extremely private or released to the public upon their death. One potential issue that may arise is the danger of an archeologist not unwrapping the outer layer of the sarcophagus. Since the recipient can only unlock the inner layer, if the outer layer is never unlocked because an archeologist forgets or disregards the slashing punishment, the sarcophagus is useless.
Use Case Examples
From the Sarcophagus Discord:
“The secret recipe for Coca-Cola is known by only two people in the world. They are not allowed to fly on the same plane so that both people (and the formula) are not lost at the same time. But what if something happens anyway? Now each holder can [create a sarcophagus of] the recipe, so that if anything happens to one of them [and they cannot attest to their liveliness], it will automatically pass to his successor in the company. This protects the valuable company secret without risking it being lost to history.”
Other potential uses:
A political dissident is crossing a dangerous border with sensitive information that will expose the current government. Before any individual can escape the country, their notebooks and computers are thoroughly searched for anything that may compromise the government. Amy plans to escape and tell the world about the horrid conditions in her home country. She uploads proof of the crimes committed by the government into a sarcophagus and puts herself as the recipient for 3 days time. Once she lands in Britain and has successfully escaped, her sarcophagus is decrypted and she has access to the information that can topple her oppressive government back home.
An old mother wants to leave her crypto funds to her children but doesn’t want anyone else to have the password before she dies in case they hack her. She creates a wallet for each of her children and leaves an equal amount in each. She then types the address, password, and seed phrase for each wallet in a separate sarcophagus addressed to each child. When she passes away and fails to attest to her liveliness, the sarcophagi are unwrapped and her children then have access to her hard earned money.
The current price of one Sarco Token, as of February 18, 2021 is $0.64, with a circulating supply of 15.6 million tokens and current market cap of $10 million. The total supply is 100 million, with 60% going towards the DAO, 20% to the creators and developers, 15% saved for archeologist incentives, 2% for archeologist grants, 2% for embalmer grants, and 1% for a liquidity mining campaign that is now over. Sarco tokens can be staked 1:1 for governing tokens that allow for voting. All payments come from the DAO fund and the governing votes are used for any decision relating to finances, payments to employees, promotions/demotions, and the future direction of the dApp. Speaking with the creator of Sarcophagus, the liquidity mining and farming were essential aspects in determining the value of the Sarco token. For the liquidity mining program, 1 million tokens were mined through staking stablecoins to earn Sarco. The liquidity mining helped naturally determine an initial value of the Sarco tokens, based on the potential interest for the stablecoins through staking. This process not only allowed them to come to a fair price to pitch to institutional investors for purchase, but also helped avoid any legal ramifications involving an ICO sale to the public.
Sarcophagus.io is now officially L2 adaptable and welcoming other chains alongside Ethereum, so that individuals who cannot afford the high gas fees on Ethereum can still interact with the protocol on a cheaper network. With their lightweight program, they hope that archeologists can run their parts on a computer as simple as a raspberry pi. With these two future goals, Sarcophagus.io may become a household name used for anything that can incorporate a dead man’s switch. I personally see the biggest use case for individuals who want to pass down their crypto passwords and in cases like wills and trusts, following the death of an individual. Sarcophagi can become the new web3 version of wills. Also, I think the political dissidents use case can become incredibly important as the pandemic and rapid inflation have put economies in a bubble at risk for bursting. Their main competitors right now are online will and trust companies, such as inherit.com, but these companies lack the decentralization and anonymity that Sarcophagus.io offers, and not to mention the larger amount of use cases for Sarcophagus.io.
In fact, while writing this article they have released their plans for a Sarcophagus.io V2, which will be developed by the mega-brains at Decent Labs. Some of the future improvements include multi-archeologist cursing and archeologist trading of Sarcophagi, which work to further prevent a single point of failure. The team at Sarcophagus are truly decentralization maximalists. They mentioned that they would have created the protocol on bitcoin if the network had the ability for the required complex smart contracts of this nature. At every step along the way, the team thought through any points of failure, where the system could be vulnerable to rogue individuals or just simply forgetful participants. The multi-archaeologists cursing solves the issue of having to rely on a single archeologist to resurrect the sarcophagus. In V2, the cursing process will entail 5 total archeologists, who have the ability to resurrect the sarcophagus. However, it will take 3, and only 3 archeologists to resurrect the file, making it a race to decrypt the file, and also making sure that a single forgetful archeologist does not lead to the loss of a valuable sarcophagus. Additionally, the trading of sarcophagi by archeologists further prevents the potential of a sarcophagus being lost forever, since soon an archeologists can trade the rights to earnings from resurrecting a sarcophagus in return for payment so that they can choose to leave the ecosystem without compromising someone’s important payload of data. Sarcophagi are truly the safest, most decentralized, most effective method for the permissionless succession of information. And don’t forget, stay bullish on the Sarco token :)
By Jack McCarthy
February 19 2022
Disclaimer: This report is for educational purposes and should not be construed as investment advice. Additionally, the author may hold any of the assets mentioned.