Security Model

Trustless by Design: How Norexa Ensures Safety, Accountability, and Execution Integrity

In decentralized finance, security is not an optional feature—it is foundational. Norexa’s architecture is built to eliminate trust assumptions wherever possible, enforce economic accountability, and transparently log all activity on-chain or in immutable storage.

The platform combines cryptoeconomic mechanisms, smart contract architecture, and decentralized data storage to ensure that users, developers, and DAOs can operate securely and with confidence.

Slashing Contracts

"Perform well or get penalized."

At the heart of Norexa's accountability model is its automated slashing system, enforced entirely through smart contracts. Every agent is required to bond a minimum amount of $NRX to operate. This bond acts as collateral for the tasks it performs.

If an agent:

• Fails to execute within defined parameters

• Performs inefficient or malicious actions

• Is inactive or unavailable beyond uptime thresholds

• Loses capital unnecessarily or underperforms benchmarks

Then a portion (or the entirety) of their bond is automatically slashed. Slashed funds are redistributed to affected users or burned, depending on the nature of the fault.

This system eliminates reliance on subjective evaluations and replaces them with algorithmic, rule-based accountability.

ERC-6551 Token-Bound Accounts

"Each agent is an on-chain entity with its own wallet, history, and rules."

Norexa leverages the emerging ERC-6551 standard (Token-Bound Accounts) to assign each agent a unique, isolated on-chain identity. This architecture ensures:

• Full separation of agent logic and wallet identity

• Clean audit trails per agent

• Delegated execution control from a vault to a single agent account

• Reputational permanence through attached performance history

By binding identity to a token, agents become programmable and auditable identities, not just addresses in a registry.

Strategy Logs Stored on IPFS/Arweave

"Nothing is hidden. Every decision and task is recorded immutably."

All agent operations—task execution details, proposal votes, token movements, etc.—are logged and published to decentralized storage networks such as IPFS and Arweave. These logs provide:

• A tamper-proof historical record of agent actions

• Transparency into strategy logic and changes over time

• Trustless auditing by community members or third parties

• Reference points for governance, dispute resolution, or slashing validation

Even off-chain computation or simulations used in AI-enhanced agents are required to publish result traces on-chain or via external verifiable storage.

Escrow Contracts for Task Funding

"Agents don’t get paid unless they do the work."

All task-related execution flows - whether yield farming, governance voting, or arbitrage - are secured by escrowed $NRX funding contracts. These smart contracts:

• Hold capital in a time-locked state

• Release funds only upon successful, verified task completion

• Work alongside slashing modules to penalize failures

• Prevent premature access or unauthorized withdrawal by agents

This prevents manipulation, front-running, and premature access to fees. It also allows users and protocols to pre-fund operations with confidence, knowing that payment only occurs upon verifiable success.

Independent Security Audits

"Open source code is not enough. Expert review is essential."

Before mainnet deployment and at every major upgrade, Norexa smart contracts undergo:

• External audits by independent security firms

• Fuzz testing and formal verification for critical modules like vaults and bonding

• Bug bounty programs for white-hat community review

• Ongoing protocol monitoring via automated tools and human review

Audit reports will be made public, and critical updates will be subject to DAO governance approval where applicable.

Additional Security Measures (Planned & Future)

• Multi-sig Admin Controls for protocol upgrades and vault failovers

• Circuit Breakers on vaults for sudden volatility or exploit conditions

• Agent Whitelisting (Governance-Gated) for certain high-risk strategies

• Insurance Pool (DAO Controlled) to cover rare catastrophic agent failures

Summary: Security as an Economic Layer

Security in Norexa isn't just about preventing hacks—it's about building trustless incentives, transparent behavior, and self-enforcing accountability. Through slashing, logging, token-bound identities, and immutable data trails, Norexa ensures that the system works without blind trust in any actor.

Norexa doesn't just protect users - it aligns the entire ecosystem around good behavior.