@keep-network/tbtc-v2 0.1.1-dev.50 → 0.1.1-dev.53

package/contracts/bridge/Bridge.sol

@@ -170,7 +170,9 @@ contract Bridge is Governable, EcdsaWalletOwner {
         uint64 redemptionDustThreshold,
         uint64 redemptionTreasuryFeeDivisor,
         uint64 redemptionTxMaxFee,
-        uint256 redemptionTimeout
+        uint256 redemptionTimeout,
+        uint96 redemptionTimeoutSlashingAmount,
+        uint256 redemptionTimeoutNotifierRewardMultiplier
     );
 
     event MovingFundsParametersUpdated(
@@ -181,15 +183,16 @@ contract Bridge is Governable, EcdsaWalletOwner {
 
     event WalletParametersUpdated(
         uint32 walletCreationPeriod,
-        uint64 walletMinBtcBalance,
-        uint64 walletMaxBtcBalance,
+        uint64 walletCreationMinBtcBalance,
+        uint64 walletCreationMaxBtcBalance,
+        uint64 walletClosureMinBtcBalance,
         uint32 walletMaxAge,
         uint64 walletMaxBtcTransfer,
         uint32 walletClosingPeriod
     );
 
     event FraudParametersUpdated(
-        uint256 fraudSlashingAmount,
+        uint96 fraudSlashingAmount,
         uint256 fraudNotifierRewardMultiplier,
         uint256 fraudChallengeDefeatTimeout,
         uint256 fraudChallengeDepositAmount
@@ -227,6 +230,8 @@ contract Bridge is Governable, EcdsaWalletOwner {
         self.redemptionTreasuryFeeDivisor = 2000; // 1/2000 == 5bps == 0.05% == 0.0005
         self.redemptionTxMaxFee = 10000; // 10000 satoshi
         self.redemptionTimeout = 172800; // 48 hours
+        self.redemptionTimeoutSlashingAmount = 10000 * 1e18; // 10000 T
+        self.redemptionTimeoutNotifierRewardMultiplier = 100; // 100%
         self.movingFundsTxMaxTotalFee = 10000; // 10000 satoshi
         self.movingFundsTimeout = 7 days;
         self.movingFundsDustThreshold = 20000; // 20000 satoshi
@@ -235,8 +240,9 @@ contract Bridge is Governable, EcdsaWalletOwner {
         self.fraudChallengeDefeatTimeout = 7 days;
         self.fraudChallengeDepositAmount = 2 ether;
         self.walletCreationPeriod = 1 weeks;
-        self.walletMinBtcBalance = 1e8; // 1 BTC
-        self.walletMaxBtcBalance = 10e8; // 10 BTC
+        self.walletCreationMinBtcBalance = 1e8; // 1 BTC
+        self.walletCreationMaxBtcBalance = 100e8; // 100 BTC
+        self.walletClosureMinBtcBalance = 5 * 1e7; // 0.5 BTC
         self.walletMaxAge = 26 weeks; // ~6 months
         self.walletMaxBtcTransfer = 10e8; // 10 BTC
         self.walletClosingPeriod = 40 days;
@@ -434,31 +440,47 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///         with the given wallet, that has timed out. The redemption
     ///         request is identified by the key built as
     ///         `keccak256(walletPubKeyHash | redeemerOutputScript)`.
-    ///         The results of calling this function: the pending redemptions
-    ///         value for the wallet will be decreased by the requested amount
-    ///         (minus treasury fee), the tokens taken from the redeemer on
-    ///         redemption request will be returned to the redeemer, the request
-    ///         will be moved from pending redemptions to timed-out redemptions.
-    ///         If the state of the wallet is `Live` or `MovingFunds`, the
-    ///         wallet operators will be slashed.
-    ///         Additionally, if the state of wallet is `Live`, the wallet will
-    ///         be closed or marked as `MovingFunds` (depending on the presence
-    ///         or absence of the wallet's main UTXO) and the wallet will no
-    ///         longer be marked as the active wallet (if it was marked as such).
+    ///         The results of calling this function:
+    ///         - the pending redemptions value for the wallet will be decreased
+    ///           by the requested amount (minus treasury fee),
+    ///         - the tokens taken from the redeemer on redemption request will
+    ///           be returned to the redeemer,
+    ///         - the request will be moved from pending redemptions to
+    ///           timed-out redemptions.
+    ///         - if the state of the wallet is `Live` or `MovingFunds`, the
+    ///           wallet operators will be slashed and the notifier will be
+    ///           rewarded
+    ///         - if the state of wallet is `Live`, the wallet will be closed or
+    ///           marked as `MovingFunds` (depending on the presence or absence
+    ///           of the wallet's main UTXO) and the wallet will no longer be
+    ///           marked as the active wallet (if it was marked as such).
     /// @param walletPubKeyHash 20-byte public key hash of the wallet
+    /// @param walletMembersIDs Identifiers of the wallet signing group members
     /// @param redeemerOutputScript  The redeemer's length-prefixed output
     ///        script (P2PKH, P2WPKH, P2SH or P2WSH)
     /// @dev Requirements:
+    ///      - The wallet must be in the Live or MovingFunds or Terminated state
     ///      - The redemption request identified by `walletPubKeyHash` and
     ///        `redeemerOutputScript` must exist
+    ///      - The expression `keccak256(abi.encode(walletMembersIDs))` must
+    ///        be exactly the same as the hash stored under `membersIdsHash`
+    ///        for the given `walletID`. Those IDs are not directly stored
+    ///        in the contract for gas efficiency purposes but they can be
+    ///        read from appropriate `DkgResultSubmitted` and `DkgResultApproved`
+    ///        events.
     ///      - The amount of time defined by `redemptionTimeout` must have
     ///        passed since the redemption was requested (the request must be
     ///        timed-out).
     function notifyRedemptionTimeout(
         bytes20 walletPubKeyHash,
+        uint32[] calldata walletMembersIDs,
         bytes calldata redeemerOutputScript
     ) external {
-        self.notifyRedemptionTimeout(walletPubKeyHash, redeemerOutputScript);
+        self.notifyRedemptionTimeout(
+            walletPubKeyHash,
+            walletMembersIDs,
+            redeemerOutputScript
+        );
     }
 
     /// @notice Submits the moving funds target wallets commitment.
@@ -785,6 +807,7 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///         rewarded.
     /// @param walletPublicKey The public key of the wallet in the uncompressed
     ///        and unprefixed format (64 bytes)
+    /// @param walletMembersIDs Identifiers of the wallet signing group members
     /// @param sighash The hash that was used to produce the ECDSA signature
     ///        that is the subject of the fraud claim. This hash is constructed
     ///        by applying double SHA-256 over a serialized subset of the
@@ -792,15 +815,28 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///        the transaction input the signature is produced for. See BIP-143
     ///        for reference
     /// @dev Requirements:
-    ///      - `walletPublicKey`and `sighash` must identify an open fraud
+    ///      - The wallet must be in the Live or MovingFunds or Closing or
+    ///        Terminated state
+    ///      - The `walletPublicKey` and `sighash` must identify an open fraud
     ///        challenge
-    ///      - the amount of time indicated by `challengeDefeatTimeout` must
-    ///        pass after the challenge was reported
+    ///      - The expression `keccak256(abi.encode(walletMembersIDs))` must
+    ///        be exactly the same as the hash stored under `membersIdsHash`
+    ///        for the given `walletID`. Those IDs are not directly stored
+    ///        in the contract for gas efficiency purposes but they can be
+    ///        read from appropriate `DkgResultSubmitted` and `DkgResultApproved`
+    ///        events.
+    ///      - The amount of time indicated by `challengeDefeatTimeout` must pass
+    ///        after the challenge was reported
     function notifyFraudChallengeDefeatTimeout(
         bytes calldata walletPublicKey,
+        uint32[] calldata walletMembersIDs,
         bytes32 sighash
     ) external {
-        self.notifyFraudChallengeDefeatTimeout(walletPublicKey, sighash);
+        self.notifyFraudChallengeDefeatTimeout(
+            walletPublicKey,
+            walletMembersIDs,
+            sighash
+        );
     }
 
     /// @notice Allows the Governance to mark the given vault address as trusted
@@ -890,22 +926,36 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///        request was created via `requestRedemption` call. Reported  timed
     ///        out requests are cancelled and locked TBTC is returned to the
     ///        redeemer in full amount.
+    /// @param redemptionTimeoutSlashingAmount New value of the redemption
+    ///        timeout slashing amount in T, it is the amount slashed from each
+    ///        wallet member for redemption timeout
+    /// @param redemptionTimeoutNotifierRewardMultiplier New value of the
+    ///        redemption timeout notifier reward multiplier as percentage,
+    ///        it determines the percentage of the notifier reward from the
+    ///        staking contact the notifier of a redemption timeout receives.
+    ///        The value must be in the range [0, 100]
     /// @dev Requirements:
     ///      - Redemption dust threshold must be greater than zero
     ///      - Redemption treasury fee divisor must be greater than zero
     ///      - Redemption transaction max fee must be greater than zero
     ///      - Redemption timeout must be greater than zero
+    ///      - Redemption timeout notifier reward multiplier must be in the
+    ///        range [0, 100]
     function updateRedemptionParameters(
         uint64 redemptionDustThreshold,
         uint64 redemptionTreasuryFeeDivisor,
         uint64 redemptionTxMaxFee,
-        uint256 redemptionTimeout
+        uint256 redemptionTimeout,
+        uint96 redemptionTimeoutSlashingAmount,
+        uint256 redemptionTimeoutNotifierRewardMultiplier
     ) external onlyGovernance {
         self.updateRedemptionParameters(
             redemptionDustThreshold,
             redemptionTreasuryFeeDivisor,
             redemptionTxMaxFee,
-            redemptionTimeout
+            redemptionTimeout,
+            redemptionTimeoutSlashingAmount,
+            redemptionTimeoutNotifierRewardMultiplier
         );
     }
 
@@ -946,10 +996,12 @@ contract Bridge is Governable, EcdsaWalletOwner {
     /// @param walletCreationPeriod New value of the wallet creation period in
     ///        seconds, determines how frequently a new wallet creation can be
     ///        requested
-    /// @param walletMinBtcBalance New value of the wallet minimum BTC balance
-    ///        in satoshi, used to decide about wallet creation or closing
-    /// @param walletMaxBtcBalance New value of the wallet maximum BTC balance
-    ///        in satoshi, used to decide about wallet creation
+    /// @param walletCreationMinBtcBalance New value of the wallet minimum BTC
+    ///        balance in satoshi, used to decide about wallet creation
+    /// @param walletCreationMaxBtcBalance New value of the wallet maximum BTC
+    ///        balance in satoshi, used to decide about wallet creation
+    /// @param walletClosureMinBtcBalance New value of the wallet minimum BTC
+    ///        balance in satoshi, used to decide about wallet closure
     /// @param walletMaxAge New value of the wallet maximum age in seconds,
     ///        indicates the maximum age of a wallet in seconds, after which
     ///        the wallet moving funds process can be requested
@@ -968,16 +1020,18 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///      - Wallet closing period must be greater than zero
     function updateWalletParameters(
         uint32 walletCreationPeriod,
-        uint64 walletMinBtcBalance,
-        uint64 walletMaxBtcBalance,
+        uint64 walletCreationMinBtcBalance,
+        uint64 walletCreationMaxBtcBalance,
+        uint64 walletClosureMinBtcBalance,
         uint32 walletMaxAge,
         uint64 walletMaxBtcTransfer,
         uint32 walletClosingPeriod
     ) external onlyGovernance {
         self.updateWalletParameters(
             walletCreationPeriod,
-            walletMinBtcBalance,
-            walletMaxBtcBalance,
+            walletCreationMinBtcBalance,
+            walletCreationMaxBtcBalance,
+            walletClosureMinBtcBalance,
             walletMaxAge,
             walletMaxBtcTransfer,
             walletClosingPeriod
@@ -1002,7 +1056,7 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///      - Fraud notifier reward multiplier must be in the range [0, 100]
     ///      - Fraud challenge defeat timeout must be greater than 0
     function updateFraudParameters(
-        uint256 fraudSlashingAmount,
+        uint96 fraudSlashingAmount,
         uint256 fraudNotifierRewardMultiplier,
         uint256 fraudChallengeDefeatTimeout,
         uint256 fraudChallengeDepositAmount
@@ -1185,6 +1239,11 @@ contract Bridge is Governable, EcdsaWalletOwner {
     ///         redemption request was created via `requestRedemption` call.
     ///         Reported  timed out requests are cancelled and locked TBTC is
     ///         returned to the redeemer in full amount.
+    /// @return redemptionTimeoutSlashingAmount The amount of stake slashed
+    ///         from each member of a wallet for a redemption timeout.
+    /// @return redemptionTimeoutNotifierRewardMultiplier The percentage of the
+    ///         notifier reward from the staking contract the notifier of a
+    ///         redemption timeout receives. The value is in the range [0, 100].
     function redemptionParameters()
         external
         view
@@ -1192,13 +1251,18 @@ contract Bridge is Governable, EcdsaWalletOwner {
             uint64 redemptionDustThreshold,
             uint64 redemptionTreasuryFeeDivisor,
             uint64 redemptionTxMaxFee,
-            uint256 redemptionTimeout
+            uint256 redemptionTimeout,
+            uint96 redemptionTimeoutSlashingAmount,
+            uint256 redemptionTimeoutNotifierRewardMultiplier
         )
     {
         redemptionDustThreshold = self.redemptionDustThreshold;
         redemptionTreasuryFeeDivisor = self.redemptionTreasuryFeeDivisor;
         redemptionTxMaxFee = self.redemptionTxMaxFee;
         redemptionTimeout = self.redemptionTimeout;
+        redemptionTimeoutSlashingAmount = self.redemptionTimeoutSlashingAmount;
+        redemptionTimeoutNotifierRewardMultiplier = self
+            .redemptionTimeoutNotifierRewardMultiplier;
     }
 
     /// @notice Returns the current values of Bridge moving funds between
@@ -1232,10 +1296,12 @@ contract Bridge is Governable, EcdsaWalletOwner {
 
     /// @return walletCreationPeriod Determines how frequently a new wallet
     ///         creation can be requested. Value in seconds.
-    /// @return walletMinBtcBalance The minimum BTC threshold in satoshi that is
-    ///         used to decide about wallet creation or closing.
-    /// @return walletMaxBtcBalance The maximum BTC threshold in satoshi that is
-    ///         used to decide about wallet creation.
+    /// @return walletCreationMinBtcBalance The minimum BTC threshold in satoshi
+    ///         that is used to decide about wallet creation.
+    /// @return walletCreationMaxBtcBalance The maximum BTC threshold in satoshi
+    ///         that is used to decide about wallet creation.
+    /// @return walletClosureMinBtcBalance The minimum BTC threshold in satoshi
+    ///         that is used to decide about wallet closure.
     /// @return walletMaxAge The maximum age of a wallet in seconds, after which
     ///         the wallet moving funds process can be requested.
     /// @return walletMaxBtcTransfer The maximum BTC amount in satoshi than
@@ -1250,16 +1316,18 @@ contract Bridge is Governable, EcdsaWalletOwner {
         view
         returns (
             uint32 walletCreationPeriod,
-            uint64 walletMinBtcBalance,
-            uint64 walletMaxBtcBalance,
+            uint64 walletCreationMinBtcBalance,
+            uint64 walletCreationMaxBtcBalance,
+            uint64 walletClosureMinBtcBalance,
             uint32 walletMaxAge,
             uint64 walletMaxBtcTransfer,
             uint32 walletClosingPeriod
         )
     {
         walletCreationPeriod = self.walletCreationPeriod;
-        walletMinBtcBalance = self.walletMinBtcBalance;
-        walletMaxBtcBalance = self.walletMaxBtcBalance;
+        walletCreationMinBtcBalance = self.walletCreationMinBtcBalance;
+        walletCreationMaxBtcBalance = self.walletCreationMaxBtcBalance;
+        walletClosureMinBtcBalance = self.walletClosureMinBtcBalance;
         walletMaxAge = self.walletMaxAge;
         walletMaxBtcTransfer = self.walletMaxBtcTransfer;
         walletClosingPeriod = self.walletClosingPeriod;
@@ -1279,7 +1347,7 @@ contract Bridge is Governable, EcdsaWalletOwner {
         external
         view
         returns (
-            uint256 fraudSlashingAmount,
+            uint96 fraudSlashingAmount,
             uint256 fraudNotifierRewardMultiplier,
             uint256 fraudChallengeDefeatTimeout,
             uint256 fraudChallengeDepositAmount

package/contracts/bridge/BridgeState.sol

@@ -122,6 +122,13 @@ library BridgeState {
         // timed out requests are cancelled and locked TBTC is returned
         // to the redeemer in full amount.
         uint256 redemptionTimeout;
+        // The amount of stake slashed from each member of a wallet for a
+        // redemption timeout.
+        uint96 redemptionTimeoutSlashingAmount;
+        // The percentage of the notifier reward from the staking contract
+        // the notifier of a redemption timeout receives. The value is in the
+        // range [0, 100].
+        uint256 redemptionTimeoutNotifierRewardMultiplier;
         // Collection of all pending redemption requests indexed by
         // redemption key built as
         // `keccak256(walletPubKeyHash | redeemerOutputScript)`.
@@ -152,7 +159,7 @@ library BridgeState {
         //    `pendingRedemptions` mapping.
         mapping(uint256 => Redemption.RedemptionRequest) timedOutRedemptions;
         // The amount of stake slashed from each member of a wallet for a fraud.
-        uint256 fraudSlashingAmount;
+        uint96 fraudSlashingAmount;
         // The percentage of the notifier reward from the staking contract
         // the notifier of a fraud receives. The value is in the range [0, 100].
         uint256 fraudNotifierRewardMultiplier;
@@ -175,11 +182,20 @@ library BridgeState {
         // Value in seconds.
         uint32 walletCreationPeriod;
         // The minimum BTC threshold in satoshi that is used to decide about
-        // wallet creation or closing.
-        uint64 walletMinBtcBalance;
+        // wallet creation. Specifically, we allow for the creation of a new
+        // wallet if the active wallet is old enough and their amount of BTC
+        // is greater than or equal this threshold.
+        uint64 walletCreationMinBtcBalance;
         // The maximum BTC threshold in satoshi that is used to decide about
-        // wallet creation.
-        uint64 walletMaxBtcBalance;
+        // wallet creation. Specifically, we allow for the creation of a new
+        // wallet if the active wallet's amount of BTC is greater than or equal
+        // this threshold, regardless of the active wallet's age.
+        uint64 walletCreationMaxBtcBalance;
+        // The minimum BTC threshold in satoshi that is used to decide about
+        // wallet closing. Specifically, we allow for the closure of the given
+        // wallet if their amount of BTC is lesser than this threshold,
+        // regardless of the wallet's age.
+        uint64 walletClosureMinBtcBalance;
         // The maximum age of a wallet in seconds, after which the wallet
         // moving funds process can be requested.
         uint32 walletMaxAge;
@@ -213,7 +229,9 @@ library BridgeState {
         uint64 redemptionDustThreshold,
         uint64 redemptionTreasuryFeeDivisor,
         uint64 redemptionTxMaxFee,
-        uint256 redemptionTimeout
+        uint256 redemptionTimeout,
+        uint96 redemptionTimeoutSlashingAmount,
+        uint256 redemptionTimeoutNotifierRewardMultiplier
     );
 
     event MovingFundsParametersUpdated(
@@ -224,15 +242,16 @@ library BridgeState {
 
     event WalletParametersUpdated(
         uint32 walletCreationPeriod,
-        uint64 walletMinBtcBalance,
-        uint64 walletMaxBtcBalance,
+        uint64 walletCreationMinBtcBalance,
+        uint64 walletCreationMaxBtcBalance,
+        uint64 walletClosureMinBtcBalance,
         uint32 walletMaxAge,
         uint64 walletMaxBtcTransfer,
         uint32 walletClosingPeriod
     );
 
     event FraudParametersUpdated(
-        uint256 fraudSlashingAmount,
+        uint96 fraudSlashingAmount,
         uint256 fraudNotifierRewardMultiplier,
         uint256 fraudChallengeDefeatTimeout,
         uint256 fraudChallengeDepositAmount
@@ -324,17 +343,29 @@ library BridgeState {
     ///        request was created via `requestRedemption` call. Reported  timed
     ///        out requests are cancelled and locked TBTC is returned to the
     ///        redeemer in full amount.
+    /// @param _redemptionTimeoutSlashingAmount New value of the redemption
+    ///        timeout slashing amount in T, it is the amount slashed from each
+    ///        wallet member for redemption timeout
+    /// @param _redemptionTimeoutNotifierRewardMultiplier New value of the
+    ///        redemption timeout notifier reward multiplier as percentage,
+    ///        it determines the percentage of the notifier reward from the
+    ///        staking contact the notifier of a redemption timeout receives.
+    ///        The value must be in the range [0, 100]
     /// @dev Requirements:
     ///      - Redemption dust threshold must be greater than zero
     ///      - Redemption treasury fee divisor must be greater than zero
     ///      - Redemption transaction max fee must be greater than zero
     ///      - Redemption timeout must be greater than zero
+    ///      - Redemption timeout notifier reward multiplier must be in the
+    ///        range [0, 100]
     function updateRedemptionParameters(
         Storage storage self,
         uint64 _redemptionDustThreshold,
         uint64 _redemptionTreasuryFeeDivisor,
         uint64 _redemptionTxMaxFee,
-        uint256 _redemptionTimeout
+        uint256 _redemptionTimeout,
+        uint96 _redemptionTimeoutSlashingAmount,
+        uint256 _redemptionTimeoutNotifierRewardMultiplier
     ) internal {
         require(
             _redemptionDustThreshold > 0,
@@ -356,16 +387,26 @@ library BridgeState {
             "Redemption timeout must be greater than zero"
         );
 
+        require(
+            _redemptionTimeoutNotifierRewardMultiplier <= 100,
+            "Redemption timeout notifier reward multiplier must be in the range [0, 100]"
+        );
+
         self.redemptionDustThreshold = _redemptionDustThreshold;
         self.redemptionTreasuryFeeDivisor = _redemptionTreasuryFeeDivisor;
         self.redemptionTxMaxFee = _redemptionTxMaxFee;
         self.redemptionTimeout = _redemptionTimeout;
+        self.redemptionTimeoutSlashingAmount = _redemptionTimeoutSlashingAmount;
+        self
+            .redemptionTimeoutNotifierRewardMultiplier = _redemptionTimeoutNotifierRewardMultiplier;
 
         emit RedemptionParametersUpdated(
             _redemptionDustThreshold,
             _redemptionTreasuryFeeDivisor,
             _redemptionTxMaxFee,
-            _redemptionTimeout
+            _redemptionTimeout,
+            _redemptionTimeoutSlashingAmount,
+            _redemptionTimeoutNotifierRewardMultiplier
         );
     }
 
@@ -426,10 +467,12 @@ library BridgeState {
     /// @param _walletCreationPeriod New value of the wallet creation period in
     ///        seconds, determines how frequently a new wallet creation can be
     ///        requested
-    /// @param _walletMinBtcBalance New value of the wallet minimum BTC balance
-    ///        in satoshi, used to decide about wallet creation or closing
-    /// @param _walletMaxBtcBalance New value of the wallet maximum BTC balance
-    ///        in satoshi, used to decide about wallet creation
+    /// @param _walletCreationMinBtcBalance New value of the wallet minimum BTC
+    ///        balance in satoshi, used to decide about wallet creation
+    /// @param _walletCreationMaxBtcBalance New value of the wallet maximum BTC
+    ///        balance in satoshi, used to decide about wallet creation
+    /// @param _walletClosureMinBtcBalance New value of the wallet minimum BTC
+    ///        balance in satoshi, used to decide about wallet closure
     /// @param _walletMaxAge New value of the wallet maximum age in seconds,
     ///        indicates the maximum age of a wallet in seconds, after which
     ///        the wallet moving funds process can be requested
@@ -449,19 +492,20 @@ library BridgeState {
     function updateWalletParameters(
         Storage storage self,
         uint32 _walletCreationPeriod,
-        uint64 _walletMinBtcBalance,
-        uint64 _walletMaxBtcBalance,
+        uint64 _walletCreationMinBtcBalance,
+        uint64 _walletCreationMaxBtcBalance,
+        uint64 _walletClosureMinBtcBalance,
         uint32 _walletMaxAge,
         uint64 _walletMaxBtcTransfer,
         uint32 _walletClosingPeriod
     ) internal {
         require(
-            _walletMinBtcBalance > 0,
-            "Wallet minimum BTC balance must be greater than zero"
+            _walletCreationMaxBtcBalance > _walletCreationMinBtcBalance,
+            "Wallet creation maximum BTC balance must be greater than the creation minimum BTC balance"
         );
         require(
-            _walletMaxBtcBalance > _walletMinBtcBalance,
-            "Wallet maximum BTC balance must be greater than the minimum"
+            _walletClosureMinBtcBalance > 0,
+            "Wallet closure minimum BTC balance must be greater than zero"
         );
         require(
             _walletMaxBtcTransfer > 0,
@@ -473,16 +517,18 @@ library BridgeState {
         );
 
         self.walletCreationPeriod = _walletCreationPeriod;
-        self.walletMinBtcBalance = _walletMinBtcBalance;
-        self.walletMaxBtcBalance = _walletMaxBtcBalance;
+        self.walletCreationMinBtcBalance = _walletCreationMinBtcBalance;
+        self.walletCreationMaxBtcBalance = _walletCreationMaxBtcBalance;
+        self.walletClosureMinBtcBalance = _walletClosureMinBtcBalance;
         self.walletMaxAge = _walletMaxAge;
         self.walletMaxBtcTransfer = _walletMaxBtcTransfer;
         self.walletClosingPeriod = _walletClosingPeriod;
 
         emit WalletParametersUpdated(
             _walletCreationPeriod,
-            _walletMinBtcBalance,
-            _walletMaxBtcBalance,
+            _walletCreationMinBtcBalance,
+            _walletCreationMaxBtcBalance,
+            _walletClosureMinBtcBalance,
             _walletMaxAge,
             _walletMaxBtcTransfer,
             _walletClosingPeriod
@@ -508,7 +554,7 @@ library BridgeState {
     ///      - Fraud challenge defeat timeout must be greater than 0
     function updateFraudParameters(
         Storage storage self,
-        uint256 _fraudSlashingAmount,
+        uint96 _fraudSlashingAmount,
         uint256 _fraudNotifierRewardMultiplier,
         uint256 _fraudChallengeDefeatTimeout,
         uint256 _fraudChallengeDepositAmount

package/contracts/bridge/Fraud.sol

@@ -260,6 +260,7 @@ library Fraud {
     ///         rewarded.
     /// @param walletPublicKey The public key of the wallet in the uncompressed
     ///        and unprefixed format (64 bytes)
+    /// @param walletMembersIDs Identifiers of the wallet signing group members
     /// @param sighash The hash that was used to produce the ECDSA signature
     ///        that is the subject of the fraud claim. This hash is constructed
     ///        by applying double SHA-256 over a serialized subset of the
@@ -271,11 +272,18 @@ library Fraud {
     ///        Terminated state
     ///      - The `walletPublicKey` and `sighash` must identify an open fraud
     ///        challenge
+    ///      - The expression `keccak256(abi.encode(walletMembersIDs))` must
+    ///        be exactly the same as the hash stored under `membersIdsHash`
+    ///        for the given `walletID`. Those IDs are not directly stored
+    ///        in the contract for gas efficiency purposes but they can be
+    ///        read from appropriate `DkgResultSubmitted` and `DkgResultApproved`
+    ///        events.
     ///      - The amount of time indicated by `challengeDefeatTimeout` must pass
     ///        after the challenge was reported
     function notifyFraudChallengeDefeatTimeout(
         BridgeState.Storage storage self,
         bytes calldata walletPublicKey,
+        uint32[] calldata walletMembersIDs,
         bytes32 sighash
     ) external {
         uint256 challengeKey = uint256(
@@ -312,9 +320,12 @@ library Fraud {
             walletPublicKey.slice32(32)
         );
         bytes20 walletPubKeyHash = compressedWalletPublicKey.hash160View();
-        Wallets.WalletState walletState = self
-            .registeredWallets[walletPubKeyHash]
-            .state;
+
+        Wallets.Wallet storage wallet = self.registeredWallets[
+            walletPubKeyHash
+        ];
+
+        Wallets.WalletState walletState = wallet.state;
 
         if (
             walletState == Wallets.WalletState.Live ||
@@ -323,8 +334,13 @@ library Fraud {
         ) {
             self.terminateWallet(walletPubKeyHash);
 
-            // TODO: Perform slashing of the wallet operators, reward the
-            //       challenger, and add unit tests for that.
+            self.ecdsaWalletRegistry.seize(
+                self.fraudSlashingAmount,
+                self.fraudNotifierRewardMultiplier,
+                challenge.challenger,
+                wallet.ecdsaWalletID,
+                walletMembersIDs
+            );
         } else if (walletState == Wallets.WalletState.Terminated) {
             // This is a special case when the wallet was already terminated
             // due to a previous deliberate protocol violation. In that