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January 2023

· 6 min read
Sebastian Nagel

This report summarizes the work on Hydra since December 2022. It serves as preparation for the monthly review meeting, where the teams update major project stakeholders on recent developments to gather their feedback on the proposed plan forward.


Looking at the roadmap, there are just a few things to report this month:

The latest roadmap with minor changes, which needs a reflection of the latest objectives.


Issues closed since last report

This month, the team worked on the following:

  • First write-up of Hydra spec online. The team has been aggregating the latest definitions of on- and off-chain semantics into a new technical specification. The latest version can still be found on Overleaf, before its integration into the core Hydra repository. Should you have feedback, please send it our way through one of the communication channels.

  • Closed more gaps in the Head Contract. The team addressed two more gaps in the on-chain scripts based on discussions on the specification.

    • All validators are authenticated now and ensure contract continuity by checking for the state tokens in the output (or getting burned).

    • Abort now fully reimburses all committed UTXOs, even if two parties would have committed the exact same output (quite a theoretical attack vector).

    This work is captured in #452, but this work item is taking quite a bit longer than expected. Also, it's a single feature item, lacking some rationale on certain requirements, so we intend to break this down into smaller pieces over the next days and weeks.

  • Mutation test framework improvements. While closing gaps in the contracts, the team realized that some of the mutation tests were correctly tripping validators and making transactions invalid, but not always for the right reason. In fact, some of the mutations were ‘too harsh’ and made the even transaction not even pass phase-1 validation. The team addressed this by introducing a first (naiive) way to assert the right cause of the failure by checking strings in the validator log. #679

  • Add headId in API and TUI. The team not only added the unique headId to the appropriate server outputs and the TUI #678, but also added sequence numbers and timestamps to produced outputs #618. This feature was asked for by users and simplifies identifying of heads and integration with the hydra-node.

  • Hydra explorer experiment. Some of the team used the holiday season to conduct some experiments on summarizing Hydra Heads observed on a network. This quick hack already demonstrates the value of a Hydra explorer as a tool to measure adoption by open heads on a given network. Naturally, it would reuse code from the hydra-node and challenge the architecture used in it for tracking multiple heads. Also, it will drive discussion about the versioning of hydra-plutus and the possibility to track multiple versions of the Hydra protocol on the chain (hashes/addresses change in each version).

Hydra explorer first experiment UI


  • The Hydra for Voting project, which got kicked off in December is picking up steam with deep dives into Catalyst voting and Hydra technology. Discussions are currently held in various settings and the team is continuing to develop a picture of what is achievable.

  • Hydra for auctions lite paper. IOG is collaborating with MLabs on exploring how Hydra can improve auction use cases. At this stage, the teams discussed multiple approaches on structuring the problem space with various Hydra topologies and specific trade-offs. The full case study was published on Essential Cardano. The teams plan to upstream the findings back into the use case section on the Hydra website from which this project originated.

Themes for 2023

After kicking off planning in a workshop and reflecting on what Hydra achieved in 2023, the team has progressed in fleshing out relevant themes and objectives for this year to position Hydra as a sustainable open-source project in the age of Voltaire:

  • A mainnet mature application

    • Why? The core contributors should be able to use the protocol on mainnet, so it should be maintainable and mature enough to lock some ada in a Hydra Head using a reference DApp (eg, hydraw). By creating and growing this DApp, the team will dogfood features and hence improve additional usability.
    • How to measure? Number of heads on mainnet > 0 and core contributors feel confident to lock at least 100₳ in a Hydra Head on mainnet.
    • Next steps:
      • Publish Hydra Head V1 specification
      • Close gaps in implementation and release 0.9.0
      • Create a request for proposals (RFP) to audit the specification and its implementation
  • Increase adoption

    • Why? The team wants to showcase what is possible with Hydra through benchmarks and lighthouse projects, enabling use cases and reducing friction to use Hydra. Also, ensuring interoperability through open standards and reference implementations.
    • How to measure? Number of third-party created heads on any network > 0
    • Next steps:
      • Build a basic Hydra Head explorer to measure adoption
      • Benchmark off-chain performance (of a selected scenario)
      • Demonstrate Hydra for payments to potential users
      • Support Hydra for voting project
      • Hydra for auctions project exploring a delegated voucher auction
  • Sustainable open-source-development

    • Why? The team wants to scale Cardano in the long run. Hence this project should not be owned by a single entity, but by the community and the Cardano network itself. It is thus essential to make contributions to the project possible and ultimately it should be easy to become a contributor.
    • How to measure? Number of contributors on GitHub
    • Next steps:
      • Open up monthly reviews
      • Add tutorials to the website
      • Publish and maintain a use-case-centric roadmap and feature map


This monthly review was the first public one with not only stakeholders from IOG and the CF, but also collaborators of the latest projects. This was the first step to a more open and transparent development process.

The teams showed some classic demos – like the ‘hydraw’ application which has been running on the same Hydra Head for four weeks now – and some new developments on the Hydra explorer and minor improvements to hydra-node API and TUI.

It was very interesting to bring various teams together to exchange ideas and thoughts on the individual roadmaps for the new year. The teams also shared the relevant themes and objectives of the Hydra project for 2023 (as also listed above). They will now make sure to reflect these steps into this concrete roadmap such that it will contain marketable features bringing us closer to these goals.