feat: PoC redeem frontrun protection

AGENTS.md

@@ -6,6 +6,7 @@
 It uses [Bun](https://bun.com/) for JavaScript and Typescript runtime and package management (instead of Nodejs + npm).
 
 The content is organized into a Bun workspace. See @README.md for:
+
 - High-level architecture and component interactions
 - Detailed setup instructions
 - Functional flow documentation
@@ -15,13 +16,13 @@
 
 All packages are in the `./packages` directory:
 
-| Package | Type | Purpose |
-|---------|------|---------|
-| `btcindexer` | Service (Worker) | Bitcoin-to-Sui bridging and minting |
-| `sui-indexer` | Service (Worker) | Sui blockchain monitoring and redemption |
-| `block-ingestor` | Service (Worker) | Receives Bitcoin blocks via REST API |
-| `compliance` | Service (Worker) | Sanctions and geo-blocking data |
-| `lib` | Shared Library | Common utilities and types |
+| Package          | Type             | Purpose                                  |
+| ---------------- | ---------------- | ---------------------------------------- |
+| `btcindexer`     | Service (Worker) | Bitcoin-to-Sui bridging and minting      |
+| `sui-indexer`    | Service (Worker) | Sui blockchain monitoring and redemption |
+| `block-ingestor` | Service (Worker) | Receives Bitcoin blocks via REST API     |
+| `compliance`     | Service (Worker) | Sanctions and geo-blocking data          |
+| `lib`            | Shared Library   | Common utilities and types               |
 
 ### Core Technologies
 
@@ -138,7 +139,7 @@
 
 **Location**: `./packages/sui-indexer`
 
 ### Architecture
 
 - `src/index.ts` - Entry point with scheduled task
 - `src/processor.ts` - Sui event indexing
@@ -156,13 +157,13 @@
 - Manages presign objects for Bitcoin transaction signing
 - Implements coin selection logic for redemption transactions
 
 ### Key Features
 
 1. **Event Monitoring**: Indexes Sui events for nBTC redemption requests
 2. **Redemption Processing**: Handles burn-and-redeem flow with IKA MPC
 3. **UTXO Management**: Manages UTXO lifecycle (available → locked → spent)
 
 ### Configuration
 
 - **Cron**: Every minute (`* * * * *`)
 - **D1 Database**: Shared `btcindexer-dev`
@@ -176,18 +177,18 @@
 
 See @packages/block-ingestor/README.md for detailed architecture.
 
 ### Architecture
 
 - `src/index.ts` - HTTP router and handlers
 - `src/ingest.ts` - Block ingestion logic
 - `src/api/put-blocks.ts` - msgpack encoding/decoding
 - `src/api/client.ts` - Client for sending blocks
 
 ### Key Features
 
 Receives Bitcoin blocks via REST API, validates them, and enqueues to `block-queue` for processing by BTCIndexer.
 
 ### Configuration
 
 - **KV Namespace**: `BtcBlocks` (shared with btcindexer)
 - **Queue Producer**: `block-queue`
@@ -197,25 +198,25 @@
 
 **Location**: `./packages/compliance`
 
 ### Architecture
 
 - `src/index.ts` - Scheduled worker entry point
 - `src/sanction.ts` - Sanctions list updating logic
 - `src/storage.ts` - D1 storage for sanctions
 - `src/rpc.ts` - RPC interface for other services to query compliance data
 
 ### Key Features
 
 1. **Sanctions List Updates**: Daily cron job fetches and updates sanctions data
 2. **Compliance API**: Exposes RPC methods for other services to check addresses
 3. **Geo-blocking**: Supports geo-blocking rules
 
 ### Configuration
 
 - **Cron**: Daily at 1am (`0 1 * * *`)
 - **D1 Database**: `compliance`
 
 ### Database Schema
 
 See migration files in `packages/compliance/db/migrations/`.
 

packages/sui-indexer/src/redeem-service.ts

@@ -326,9 +326,6 @@ export class RedeemService {
 		const availableUtxos = await this.storage.getAvailableUtxos(req.setup_id);
 		const selectedUtxos = selectUtxos(availableUtxos, req.amount);
 
-		// TODO: we should continue only if our solution is better than the existing one - in case
-		//   someone frontrun us.
-
 		if (!selectedUtxos) {
 			logger.warn({
 				msg: "Insufficient UTXOs for request",
@@ -338,26 +335,40 @@ export class RedeemService {
 			return;
 		}
 
+		const client = this.getSuiClient(req.sui_network);
+		const proposalArgs = {
+			redeemId: req.redeem_id,
+			utxoIds: selectedUtxos.map((u) => u.nbtc_utxo_id),
+			nbtcPkg: req.nbtc_pkg,
+			nbtcContract: req.nbtc_contract,
+		};
+
 		try {
-			const client = this.getSuiClient(req.sui_network);
-			const txDigest = await client.proposeRedeemUtxos({
-				redeemId: req.redeem_id,
-				utxoIds: selectedUtxos.map((u) => u.nbtc_utxo_id),
-				nbtcPkg: req.nbtc_pkg,
-				nbtcContract: req.nbtc_contract,
-			});
+			const result = await client.proposeRedeemUtxos(proposalArgs);
 
-			logger.info({
-				msg: "Proposed UTXOs for redeem request",
-				redeemId: req.redeem_id,
-				txDigest: txDigest,
-			});
-			await this.storage.markRedeemProposed(
-				req.redeem_id,
-				selectedUtxos.map((u) => u.nbtc_utxo_id),
-				this.utxoLockTimeMs,
-			);
+			if (result.success) {
+				logger.info({
+					msg: "Proposed UTXOs for redeem request",
+					redeemId: req.redeem_id,
+					txDigest: result.digest,
+				});
+				await this.storage.markRedeemProposed(
+					req.redeem_id,
+					selectedUtxos.map((u) => u.nbtc_utxo_id),
+					this.utxoLockTimeMs,
+				);
+			} else {
+				// Contract abort: someone already proposed a better solution.
+				// Mark as proposed without locking UTXOs so the redeem continue.
+				logger.info({
+					msg: "Proposal rejected on-chain, another worker proposed a better solution",
+					redeemId: req.redeem_id,
+					txDigest: result.digest,
+				});
+				await this.storage.markRedeemProposed(req.redeem_id, [], 0);
+			}
 		} catch (e: unknown) {
+			// Network error: leave as pending so next cron retry.
 			logError(
 				{
 					msg: "Failed to propose UTXOs for redeem request",

packages/sui-indexer/src/redeem-sui-client.ts

@@ -20,7 +20,9 @@ export interface SuiClientCfg {
 
 export interface SuiClient {
 	ikaClient(): IkaClient;
-	proposeRedeemUtxos(args: ProposeRedeemCall): Promise<string>;
+	proposeRedeemUtxos(
+		args: ProposeRedeemCall,
+	): Promise<{ success: boolean; digest: string | null }>;
 	solveRedeemRequest(args: SolveRedeemCall): Promise<string>;
 	finalizeRedeem(args: FinalizeRedeemCall): Promise<string>;
 	requestIkaPresigns(count: number): Promise<string[]>;
@@ -111,7 +113,9 @@ class SuiClientImp implements SuiClient {
 		return Buffer.from(decoded).toString("hex");
 	}
 
-	async proposeRedeemUtxos(args: ProposeRedeemCall): Promise<string> {
+	async proposeRedeemUtxos(
+		args: ProposeRedeemCall,
+	): Promise<{ success: boolean; digest: string | null }> {
 		const tx = new Transaction();
 
 		tx.add(
@@ -135,11 +139,10 @@ class SuiClientImp implements SuiClient {
 			},
 		});
 
-		if (result.effects?.status.status !== "success") {
-			throw new Error(`Transaction failed: ${result.effects?.status.error}`);
-		}
-
-		return result.digest;
+		return {
+			success: result.effects?.status.status === "success",
+			digest: result.digest ?? null,
+		};
 	}
 
 	async solveRedeemRequest(args: SolveRedeemCall): Promise<string> {