A Gasless Method to Purchase ETH with USDC

Introduction

In the evolving world of blockchain transactions, gas fees remain a significant barrier for many users. This article explores an innovative smart contract solution that enables users to swap USDC for ETH without paying gas fees directly. Instead, the gas costs are covered by the transaction itself, making the process more accessible and efficient.

This method relies on a specialized contract acting as a trusted intermediary between users (customers) and gas providers. By leveraging ERC-2612 permits and EIP-712 signed messages, the system ensures security and transparency while eliminating the need for users to hold ETH for gas.

How the Gas Broker Contract Works

The Core Concept

The Gas Broker contract serves as a middleware that facilitates the exchange of USDC for ETH. Customers sign messages that authorize the transfer of their USDC and specify a reward for the gas provider. The gas provider then executes the transaction, paying the gas fees and receiving the USDC in return, while the customer gets ETH.

This approach is particularly useful for users who hold stablecoins like USDC but need ETH to interact with the Ethereum network. It removes the initial need to acquire ETH for gas, streamlining the onboarding process.

Key Components

Customer: The user who holds USDC and wants to acquire ETH without paying gas fees.
Gas Provider: The entity that executes the transaction, covering the gas costs in exchange for a reward in USDC.
Gas Broker Contract: The smart contract that facilitates the secure exchange between the two parties.

Technical Implementation of the Swap Function

Interface Design

The swap function is the heart of the Gas Broker contract. It requires multiple parameters to ensure security and functionality:

Signer address: The customer's address.
Token address: The USDC contract address.
Value: The amount of USDC to be swapped.
Deadline: The expiration time for the permit signature.
Reward: The amount of USDC offered to the gas provider.
Signature components: Split parts (v, r, s) for both the permit and reward signatures.

Here is the function interface:

function swap(
    address signer,
    address token,
    uint256 value,
    uint256 deadline,
    uint256 reward,
    uint8 permitV,
    bytes32 permitR,
    bytes32 permitS,
    uint8 rewardV,
    bytes32 rewardR,
    bytes32 rewardS) external payable

Step-by-Step Swap Logic

Validation Checks:
- Ensure the reward does not exceed the transaction value.
- Verify the reward signature using EIP-712 standards.
Permit Execution:
- Call the token's permit function to authorize the Gas Broker to transfer USDC from the customer.
Oracle Price Check:
- Query a price oracle to determine the equivalent ETH amount for the USDC value minus the reward.
ETH Transfer:
- Check if the gas provider sent sufficient ETH.
- Transfer ETH to the customer and any excess back to the gas provider.
Token Transfer:
- Transfer USDC from the customer to the Gas Broker contract.
- Forward the USDC to the gas provider.

This sequence ensures a trustless and efficient exchange, with all actions validated on-chain.

Preventing Replay Attacks in Reward Messages

The Replay Attack Risk

Without proper safeguards, a malicious gas provider could reuse a signed reward message from a previous transaction. For example, if a customer signed a message for a 10 USDC reward in the past, a gas provider might attempt to use that signature again in a new transaction to claim a higher reward.

Solution: Linking Reward and Permit Signatures

To prevent this, each reward message includes a reference to its corresponding permit signature. The reward message structure includes:

value: The reward amount in USDC.
permitHash: The Keccak256 hash of the permit signature components.

This ensures that each reward signature is uniquely tied to a specific permit signature, making replay attacks impossible.

EIP-712 Compliance

The reward message is structured according to EIP-712, allowing wallets like MetaMask to display human-readable information. Users can review the details before signing, enhancing security and trust.

The domain separator and hash function are implemented within the Gas Broker contract to facilitate this.

Code Deep Dive: Key Functions

Reward Verification

The verifyReward function checks the authenticity of the reward signature using elliptic curve recovery:

function verifyReward(
    address signer,
    Reward memory reward,
    uint8 sigV,
    bytes32 sigR,
    bytes32 sigS
) private view returns (bool) {
    return signer == ecrecover(hashReward(reward), sigV, sigR, sigS);
}

ETH Amount Calculation

The contract uses an external price oracle to determine the ETH amount equivalent to the USDC value:

function _getEthAmount(address token, uint256 amount) internal view returns (uint256 ethAmount) {
    ethAmount = priceOracle.getPriceInEth(address(token), amount);
}

Gas providers can call a public view function, getEthAmount, to estimate the required ETH before executing a swap.

Security Considerations and Best Practices

Signature Handling

Never sign raw byte strings without understanding the data. Use EIP-712 to display structured information.
Ensure all signatures have expiration deadlines to prevent stale transactions.

Contract Upgrades and Oracle Reliability

The price oracle is critical for accurate conversions. Use a decentralized oracle for robustness.
The Gas Broker contract is immutable once deployed. Carefully audit all code before mainnet deployment.

Gas Efficiency

Signature parameters are split into v, r, s to reduce gas costs during execution.
The contract uses OpenZeppelin libraries for safe token transfers and address operations.

Frequently Asked Questions

How does the gasless swap work?
The gas provider pays the gas fees for the transaction and receives a reward in USDC. The customer gets ETH without needing to hold any ETH initially.

Is this method secure?
Yes, through EIP-712 signed messages and replay protection, the system ensures that only intended transactions are executed.

What tokens are supported?
The current implementation focuses on USDC, but the contract can be adapted for other ERC-20 tokens with permit functionality.

How is the ETH price determined?
A price oracle provides the exchange rate. You can explore more strategies for integrating oracles.

Can I use this on any Ethereum network?
The contract must be deployed on a network that supports EIP-2612 permits. Most major networks do.

What happens if the oracle fails?
The transaction will revert if the oracle doesn't return a price, ensuring no incorrect exchanges occur.

Conclusion

The Gas Broker contract offers a innovative solution for gasless swaps, enabling users to convert USDC to ETH without upfront gas costs. By leveraging advanced signature standards and robust security measures, it provides a secure and efficient method for asset exchange.

This approach not only enhances user experience but also opens new possibilities for decentralized finance applications. For those interested in implementing similar solutions, view real-time tools and resources to get started.

Future developments could include support for more tokens and advanced features like limit orders. The potential for gasless transactions is vast, and this contract is a step towards making blockchain more accessible to all.