High-Level Architecture

The IRIS Protocol is designed around a strictly permissioned hub-and-spoke smart contract architecture, prioritizing security, modularity, and isolated risk execution.

The system operates across three distinct operational layers:

1. On-Chain Contracts: The immutable Solidity smart contracts that handle canonical truth, intent settlement, isolated pod deployment, solver bond management, and adversarial liquidation.
2. Off-Chain RFQ Coordinator: High-performance off-chain infrastructure that orchestrates the auction sequence, collects and cryptographically verifies solver bids, and routes optimal intents for execution.
3. Solver Network: Distributed, automated agents operated by independent quantitative market makers. They maintain active connections to the RFQ Coordinator, continuously compute rate curves, and submit signed competitive bids.

The Core Contracts

IRIS leverages a modular design where IRIS_Core acts as the central state registry. Every major lifecycle transition—from intent settlement to position liquidation—is routed through or verified by the core registry.

Isolated LoanPods (EIP-1167)

To eliminate systemic risk, IRIS does not pool borrower collateral. Every newly originated intent results in the deployment of a unique LoanPod via an EIP-1167 minimal proxy.

This isolation architecture guarantees that vulnerabilities, edge-case exploits, or oracle failures affecting one position cannot geometrically propagate through the protocol. A single Pod custodies exactly the collateral for one specific borrower and interfaces with exactly one lending venue position at a time.

• Borrowers interface with the protocol almost entirely through their dedicated Pod.
• Solvers are granted constrained execution rights on the Pod to optimize the underlying variable loan. These rights are enforced by the PositionGuard contract to prevent malicious extraction.

The Bond Manager

Because IRIS relies on a counterfactual guarantee of capital rather than a native liquidity pool, the BondManager serves as the economic enforcement engine. Before quoting rates, Solvers must stake baseline capital. Upon winning an auction, the contract escrows a statistically derived portion of this capital to cover worst-case volatility. The BondManager autonomously handles the slashing of these bonds if a solver fails to settle an intent or defaults during a catastrophic rate spike.

Universal Venue Adapters

To interact with external liquidity (like Aave or Compound) without hardcoding platform-specific logic into the core protocol, IRIS utilizes an adapter pattern. Standardized interfaces (supply, borrow, repay, withdraw) abstract the complexities of external DeFi protocols, allowing IRIS to rapidly expand its list of supported variable-rate substrates without upgrading the core settlement engine.