ledger-rs/doc/architecture.md

Architecture Decisions

UTXO (Unspent Transaction Output)-Style Postings

Value is stored as postings — signed amounts of a single asset owned by exactly one account. A positive posting is value controlled by the account; a negative posting is an offset position (issuance, external flow, or system balancing).

Account balance = sum of non-Inactive postings (Active + PendingInactive) for that (account, asset) pair. There is no mutable balance field to drift out of sync.

Consumed postings are marked inactive but never deleted, preserving a full audit trail.

Pure Core / Async Layer Separation

graph LR
    subgraph "kuatia-core (pure, sync, no IO)"
        V[validate_and_plan]
        S[select_postings]
        H[hash / transfer_id]
        T[Types & ToBytes]
    end
    subgraph "kuatia (async, IO)"
        L[Ledger]
        ST[Store sub-traits]
        SG[Saga steps]
    end
    L --> V
    L --> S
    L --> ST
    SG --> L
    SG --> ST

kuatia-core contains all validation logic with no IO, no async runtime, and near-zero dependencies. It can be tested with golden vectors, replayed deterministically, and embedded in no_std environments.

kuatia adds the async Store trait (used as dyn Store via trait objects) and composes the saga commit pipeline. The Ledger struct is non-generic — it holds an Arc<dyn Store>, which allows the legend! macro to define saga types with concrete LedgerCtx.

This separation ensures the auditable heart of the system is fully deterministic and independently testable.

Store Sub-Trait Architecture

The Store trait is a composite of focused sub-traits, each responsible for a single domain. Every write method is a dumb instruction: it applies one update and returns the number of affected rows (or an I/O error). It never interprets the count, decides state, enforces idempotency, or compensates — the saga does.

classDiagram
    class AccountStore {
        +get_account(id)
        +get_accounts(ids)
        +create_account(account)
        +append_account_version(account)
        +get_account_history(id)
        +list_accounts()
    }
    class PostingStore {
        +get_postings(ids)
        +get_postings_by_account(account, asset?, status?)
        +reserve_postings(ids, reservation) u64
        +release_postings(ids, reservation) u64
        +deactivate_postings(ids, reservation?) u64
        +insert_postings(postings) u64
    }
    class TransferStore {
        +get_transfer(id)
        +store_transfer(record, involved) u64
        +get_transfers_for_account(account)
        +query_transfers(query)
    }
    class SagaStore {
        +save_saga(id, data)
        +list_pending_sagas()
        +delete_saga(id)
    }
    class EventStore {
        +append_event(event)
        +get_events_since(after_seq, limit)
    }
    class BookStore {
        +create_book(book)
        +get_book(id)
        +list_books()
    }
    class Store {
        <<composite>>
    }
    Store --|> AccountStore
    Store --|> PostingStore
    Store --|> TransferStore
    Store --|> SagaStore
    Store --|> EventStore
    Store --|> BookStore

There is no single atomic commit boundary. A commit is a sequence of the dumb primitives above (reserve_postings → deactivate_postings → insert_postings → store_transfer → append_event), each its own atomic update and each idempotent. The saga sequences them and interprets their counts; a crash mid-sequence is completed by roll-forward recovery (see below).

The store only persists and reads — all domain logic (balance computation, validation, policy enforcement, and the interpretation of primitive counts) lives in the Ledger/saga and kuatia-core.

Saga Commit Pipeline

Every commit is the envelope saga. commit(transfer) resolves the intent into a concrete envelope (read-only), then runs commit_envelope, which persists a write-ahead PendingSaga record (phase Reserving) and drives two steps. Validation lives inside the finalize step so it runs as late as possible — immediately before the writes.

sequenceDiagram
    participant C as Caller
    participant L as Ledger
    participant R as ReserveStep
    participant F as FinalizeStep
    participant S as Store

    C->>L: commit(transfer) → resolve → commit_envelope(envelope)
    L->>S: save_saga(PendingSaga{envelope, reservation, Reserving})
    L->>R: execute
    R->>S: reserve_postings(ids, rid) → count
    Note over R: interpret count (full / partial / zero+read)

    L->>F: execute (finalize_envelope)
    F->>S: load + validate_and_plan() [last-step floor / freeze-close re-check]
    F->>S: save_saga(... Finalizing)  [point of no return]
    F->>S: deactivate_postings(consumed, rid) → verify all Inactive
    F->>S: insert_postings(created) → verify exist
    F->>S: store_transfer(record, involved) → verify transfer exists
    F->>S: append_event(committed)
    F-->>L: Receipt
    L->>S: delete_saga(...)
    L-->>C: Receipt

On in-process failure before the point of no return, legend compensates in LIFO order (finalize is a no-op if nothing committed; reserve runs release_postings). Once the finalize step has marked the saga Finalizing and begun deactivating, the half-applied commit is rolled forward by recovery rather than compensated — see below.

Durable Crash Recovery

There is no single atomic transaction, so crash-safety comes from a phase-tracked write-ahead record plus idempotent roll-forward. commit_envelope persists a PendingSaga {envelope, reservation, phase} via SagaStore before the saga mutates anything (phase = Reserving); the finalize step bumps it to Finalizing after validation passes and just before the consumed postings start turning Inactive. The record is deleted only when the transfer is committed or the commit was cleanly abandoned before finalize.

Ledger::recover() (call on startup) re-completes any surviving pending saga, branching on the persisted phase so it never commits something that did not validate or consume postings it does not own:

graph TD
    A[get_transfer?] -->|exists| Z[delete record, done]
    A -->|missing| P{phase}
    P -->|Reserving| RR[re-run saga: reserve + finalize]
    RR -->|re-validates; aborts cleanly if taken/frozen| Z
    P -->|Finalizing| FF[finalize_envelope: roll forward, verified]
    FF --> Z

• A Reserving saga had not necessarily validated, so recovery re-runs the real saga — which re-reserves and re-validates against current state. If the postings were taken by another transfer, or an account was frozen, it aborts cleanly (nothing commits) and the record is deleted.
• A Finalizing saga had already validated and owns its postings (it reached the point of no return), so recovery rolls it forward through the verified finalize_envelope, which checks every end-state and only creates/stores once all consumed postings are confirmed Inactive — the double-spend guard.

Recovery is roll-forward, not rollback, so the reservation protocol never leaves orphaned PendingInactive postings for a separate reconciliation pass.

reverse() builds a reversal envelope and runs the same commit_envelope path — there is no separate raw/atomic entry point.

Content-Addressed Transfers

EnvelopeId is the double-SHA-256 of a transfer's canonical binary serialization. This serves two purposes:

• Idempotency — committing the same transfer twice returns the cached receipt instead of applying it again.
• Tamper evidence — any modification to a transfer's data changes its ID.

All domain types implement deterministic binary serialization (ToBytes trait) using big-endian encoding with a version prefix (CANONICAL_VERSION = 1).

Append-Only Account Versioning

Accounts are never modified in place. Each account mutation (freeze, unfreeze, close, or a policy/flags change) appends a new snapshot with an incremented version field (starts at 1 on creation). Note that transfers do not bump account versions — balances are derived from postings, not stored on the account.

The store enforces that each new version is exactly current + 1, preventing gaps or overwrites. The full version history is queryable via account_history().

Account Snapshot Pinning

Transfers can carry AccountSnapshotId values — pairs of (AccountId, snapshot_hash) recording which account versions the transfer was validated against.

During validation, if snapshots are provided, the current account state is hashed and compared. A mismatch produces AccountVersionMismatch, preventing TOCTOU (Time-Of-Check to Time-Of-Use) races where an account is mutated between load and apply.

The commit() convenience method auto-populates snapshots when none are provided.

Per-Asset Conservation

The conservation invariant is: for each asset, the sum of consumed posting values must equal the sum of created posting values.

Conservation boundaries are per-asset only. The book field on transfers and accounts is a transfer policy scope (which accounts/assets may participate) — it does not affect conservation enforcement, and it does not partition balances.

Account Policies

Each account has a policy controlling its balance floor and whether it may hold negative postings:

Policy	Balance floor	Negative postings
NoOverdraft	>= 0	No
CappedOverdraft { floor }	>= floor	Yes (down to floor)
UncappedOverdraft	None	Yes (unbounded)
SystemAccount	None	Yes
ExternalAccount	None	Yes

An overdraft is a negative posting assigned to the account to cover a shortfall. Only NoOverdraft forbids negative postings; validation rejects a negative posting on a NoOverdraft account. CappedOverdraft's floor (checked in validation) bounds the negative balance; the other policies are unbounded.

The CappedOverdraft Floor Under Concurrency

CappedOverdraft accounts have a balance floor that is not backed by the UTXO model alone — two concurrent transfers could each pass validation but together push the balance below the floor (write-skew).

Under the dumb-storage model the floor (and the freeze/close snapshot check) is re-validated as the last thing the finalize step does before it writes — the finalize step re-loads balances and account versions and re-runs validate_and_plan immediately before deactivate_postings. This is the tightest best-effort: the check-to-write window is one step, not the whole saga's lifetime, and it also runs on the recovery path. It is not strictly atomic, though — without folding the check into the write itself (a CAS) or serializing per account, a concurrent commit landing in that last sub-step gap can still slip through. Double-spend safety is unaffected and holds unconditionally: the reservation protocol (reserve_postings is a single atomic conditional update, so two sagas cannot both claim the same posting) prevents consuming a posting twice. Only the floor on a CappedOverdraft account is best-effort. This tradeoff is recorded in doc/adr/0001-dumb-storage-saga-recovery.md.

NoOverdraft is fully UTXO-backed (you can only spend postings you own), and the unconstrained policies have no floor to violate.

No Sequential Hash Chain

An earlier design linked each transfer to its predecessor via a hash chain, enforcing total ordering. This was removed because:

• UTXO double-spend prevention already prevents reordering attacks (a posting can only be consumed once).
• Content-addressed transfer IDs provide tamper evidence without chaining.
• Append-only account versioning prevents account state manipulation.
• The chain was a concurrency bottleneck — every transfer had to wait for its predecessor's hash.

Posting Selection

The intent layer hides UTXO complexity from callers. Every operation is expressed as one or more Movement { from, to, asset, amount } values. The resolve step aggregates net debits per (account, asset) across all movements, then for each pair with a positive net debit, the select_postings function uses a greedy largest-first algorithm:

1. Filter to active, positive postings of the target asset.
2. Sort by value descending.
3. Accumulate until the sum meets or exceeds the target.

If the selected sum exceeds the target, the resolve step creates a change posting returning the remainder to the sender — exactly like Bitcoin's change outputs.

Aggregating before selection means multiple movements debiting the same account share one selection pass, avoiding double-selection of the same postings.

Posting Lifecycle

Postings follow a three-state lifecycle managed by the saga pipeline:

stateDiagram-v2
    [*] --> Active: insert_postings
    Active --> PendingInactive: reserve_postings
    PendingInactive --> Active: release_postings (compensation)
    PendingInactive --> Inactive: deactivate_postings(reservation)
    Active --> Inactive: deactivate_postings(None)

State	Available	In balance	Description
Active	Yes	Yes	Available for consumption
PendingInactive	No	Yes	Reserved for a transfer. Reverts to Active on compensation
Inactive	No	No	Consumed. Kept for audit trail (void)

Batch semantics

reserve_postings and release_postings operate on batches with atomic semantics — if any posting fails validation, the entire batch is rejected and no state changes.

• reserve_postings(ids) — all postings must be Active; fails if any is not.
• release_postings(ids) — fails if any posting is Inactive (void); Active postings are a no-op, PendingInactive postings revert to Active.

This enables shard-local writes: each posting reservation is an independent operation on the posting's shard, with no cross-shard coordination needed.

Saga Composition

Internal pipeline steps

The envelope saga is two legend::Step implementations operating on LedgerCtx (resolution runs before the saga, in Ledger::commit):

Step	Execute	Compensate	Retry
ReservePostingsStep	Reserve postings Active → PendingInactive, interpret the count	Release back to Active	3 retries
FinalizeTransferStep	Ledger::finalize_envelope: re-validate (last-step floor/freeze guard) → mark Finalizing → deactivate → insert → store_transfer → append_event, verifying every end-state	reverse(transfer_id)	3 retries

High-level composition steps

Higher-level steps compose over the intent-layer API for multi-transfer workflows:

Step	Execute	Compensate
PayMovementStep	Build pay transfer, ledger.commit(...)	ledger.reverse(receipt.transfer_id)
DepositMovementStep	Build deposit transfer, ledger.commit(...)	ledger.reverse(receipt.transfer_id)
WithdrawMovementStep	Build withdraw transfer, ledger.commit(...)	ledger.reverse(receipt.transfer_id)

Custom orchestration with legend

You can compose any combination of steps into a saga using the legend! macro. Legend drives the steps in order, retries on transient failures, and compensates completed steps in reverse (LIFO) on unrecoverable failure.

use std::sync::Arc;
use legend::legend;
use kuatia::saga::*;

// Define a multi-transfer saga
legend! {
    FundAndPay<LedgerCtx, SagaError> {
        deposit: DepositMovementStep,
        pay: PayMovementStep,
    }
}

// Build and run — Ledger uses Arc<dyn Store>, so LedgerCtx is concrete
let ledger: Arc<Ledger> = /* ... */;
let saga = FundAndPay::new(FundAndPayInputs {
    deposit: DepositInput { to: alice, asset: usd, amount, external: bank },
    pay: PayInput { from: alice, to: bob, asset: usd, amount },
});
let ctx = LedgerCtx::new(ledger.clone());
let result = saga.build(ctx).start().await;

match result {
    ExecutionResult::Completed(e) => { /* all steps succeeded */ }
    ExecutionResult::Failed(_, err) => { /* deposit was compensated */ }
    ExecutionResult::Paused(e) => { /* serialize e for crash recovery */ }
    ExecutionResult::CompensationFailed { .. } => { /* manual intervention */ }
}

Since Ledger uses Arc<dyn Store> internally, LedgerCtx is a concrete type — no generic parameters needed. This is what allows legend! to define saga types directly.

The LedgerCtx is serializable — a paused saga can be persisted and resumed later, enabling crash recovery. On boot, load pending sagas and resume them; legend will compensate any completed steps that need rollback.

Reversal

reverse() creates a compensating transfer that consumes the original's created postings and recreates its consumed postings, effectively undoing the operation while preserving the full audit trail.