Risk Management & Security Model

Mudra Pay is engineered with multiple overlapping layers of protection to ensure protocol safety and user protection.

User Custody Until Payment Verified

Users retain full custody of their crypto funds at all times. Funds are only released from the user's state channel after the resolver's UPI payment is successfully executed and cryptographically verified via zero-knowledge proofs.

Hardware Trust (TEE)

Critical order orchestration runs inside verified secure enclaves, providing strong guarantees against tampering and unauthorized access.

Cryptographic Quorum

No single party (including the relayer) can unilaterally move funds or alter order state. Every important action requires coordinated signatures from multiple participants.

Economic Alignment via Staking

Resolvers are required to stake collateral in stablecoins. This stake acts as a performance bond — honest behavior is rewarded, while malicious or negligent actions can result in slashing.

Yield on Staked Capital

Staked collateral can earn yield through restaking mechanisms, creating strong incentives for resolvers to participate reliably and stay active in the network.

Zero-Knowledge Proof Verification

ZK proofs ensure that payment confirmation is cryptographic and verifiable, further reducing trust assumptions in the resolver network.

These mechanisms work together to create a self-enforcing system where economic incentives, cryptographic guarantees, and hardware security align to minimize risk for all participants.