Security Milestones - Full ICA Enabled Improvements Of StaFi On Cosmos


StaFi Protocol, which came into existence in 2019, initially faced limitations while conceptualizing Liquid Staking Tokens (LSTs). Creating an LST for Layer 1 presented several challenges, especially in terms of the available technology. Furthermore, the emergence of unique Proof of Stake (PoS) consensus designs, such as DPoS, BPoS, NPoS, LPoS, and others, made it impractical to create a generalized LST infrastructure. Therefore, every new LST had to be tailored to align with the specific consensus of the corresponding Layer1, with many of its features uniquely matched to that particular consensus.

As a result, StaFi’s LST solutions diversified in tandem with the development of various Layer 1s between 2019 and 2022. In the long run, StaFi Protocol is focusing on two critical optimizations: generalizing LST solutions and improving security. In this article, we delve into the specific security improvements made to rATOM, the StaFi LST solution designed for Cosmos.

The security of rATOM is based on StaFiHub, an appchain built on the CosmosSDK. The technology behind rATOM has recently undergone an upgrade from its previous Substrate-based version (V1) to the CosmosSDK-based version (V2), with a corresponding migration of relative stacks. Notably, the rATOM Relay no longer utilizes a multi-signature address, indicating that the transition from V1 to V2 is now complete. This transition enables a completed Interchain Account (ICA) feature, which means that all delegations from the rATOM Relay will now interact with the Cosmos chain using the ICA module, thereby resulting in a higher level of security.



In May 2021, rATOM V1 was launched, which relied on a multi-sig account in the Relay for managing staking operations. Subsequently, in August 2022, rATOM V2 was introduced, which replaced the multi-sig account with an Interchain Account (ICA) in the Relay to manage to stake.

The release of V2 required a migration from both developers and stakers. To achieve this, stakers were required to first unstake their ATOM from V1 and then stake it in V2 using ICA. The following strategy was formulated to facilitate the migration:

  • New ATOM would be staked via ICA
  • Unstaked ATOM would be executed via a multi-sig account.

This strategy resulted in the complete unstaking of all staked ATOM, leading to the removal of the multi-sig account once all staked amounts were unstaked. On April 17th, 2023, the removal transaction was executed as there were no staked ATOMs being managed by the multi-sig account, marking a significant milestone for the migration process.

ICA Security

ICA module is built in the new version of CosmosSDK, it allows you to control an account on a host chain from a controller chain , this account on a host chain has all the capabilities of a normal account. However, rather than signing transactions with a private key, a controller chain’s authentication module will send IBC packets to the host chain which signals what transactions the interchain account should execute, which means ICA is controlled programmatically by separate chains via IBC transactions. On StaFi, ICA facilitates signatures through IBC transactions instead of private key signatures. The migration process has been completed, and all staking interactions will now be executed via ICA, thereby enhancing the security of staking management. To put it simply, there is no longer any need for private key management or third-party involvement. The management of keys has been transferred from parties to chains, resulting in a higher level of security.

Project Status

  • The rATOM solution is now fully ICA-enabled.
  • The rIRIS solution is ICA enabled, but not updated yet, with 4 of 7 multi-sign accounts being managed by the IRISnet Foundation and StaFi Foundation.
  • The Chihuahua solution does not currently have ICA enabled, with 4 out of 7 multi-sign accounts being managed by the StaFi Foundation.
  • The rSWTH solution will become ICA-enabled in the near future.

The integration and upgrade of solutions will depend on the ICA module being enabled. New integrations will be ICA-supported directly, and current rTokens will be upgraded gradually.

Future Plans

Security is a crucial aspect of blockchain technology, and StaFi Protocol is dedicated to ensure safe and secure cross-chain interactions for its users. Currently, the StaFi solution relies on off-chain services to monitor events on the Host chain and relay updates regarding staking, rewards, and redemption rates to the controlled chain. However, the ICA module provides an on-chain alternative that could potentially replace these services, further increasing the level of security for cross-chain interactions within the StaFi ecosystem.

The ICQ (Interchain Query) module is currently under development and offers an on-chain solution that has the potential to replace off-chain services. As outlined in the article, the ICQ module enables the Host chain to send queries to the controlled chains via IBC. Although the functions of the module may be limited, it can still provide on-chain access to staked asset-related data, eliminating the need for off-chain services. Integrating ICA and ICQ to remove third-party asset management will greatly enhance security for StaFi Protocol. Therefore, the team is currently dedicating significant effort to investigating the technology of ICQ, and integration will be released as soon as it is ready. By adopting ICA and ICQ, StaFi Protocol can achieve a higher degree of decentralization for its rTokens. The need for third-party interactions and management, especially for asset-related functions, can be eliminated with the use of these modules. With ICA, staking operations can be executed and the results can be queried on-chain without relying on off-chain services. This can lead to a more decentralized and secure network for StaFi users, with most of the operations being automated and conducted on-chain.


StaFi Protocol places utmost importance on security and continuously strives to enhance it through the development of innovative solutions. Through the transition from V1 to V2 and beyond, StaFi remains steadfast in its commitment to achieving ever-higher levels of security. With each milestone achieved, StaFi’s LSTs solution solidifies its position as a leading protocol in the staking space.

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