We assume below that you already have read the How it works section.
In general, Connext adopts the same core security model as other locking systems such as HTLCs. Unlike other systems, Connext is less vulnerable to free options as all interactions across chains are with 1:1 assets (e.g. ETH on Optimism to ETH on Arbitrum).
Barring the possibility of a hack or user error, there is no way for users to lose funds in this system. To ensure that they are safe, users simply need to make sure that the corresponding
prepare transaction on the destination chain has the same transaction data as what they sent on the origin chain.
There is a possibility that routers can lose funds if the chain is attacked or if a router goes completely offline for an extended duration while transfers are in progress. After a user
fulfills their transaction on the destination chain, routers have until the transaction's
expiry to submit the corresponding
fulfill tx on the origin chain to claim their funds. If routers fail to do this, the transaction on the origin chain is automatically reverted back to the user.
In practice, this is an acceptable risk so long as the duration of
expiry is long enough to mitigate chain congestion attacks and to account for potential downtime. Routers are assumed to be automated/online actors with high reliability (similar to nodes and validators for other systems), and can gracefully shut down their operations without risk if they cease to accept new transactions and complete all pending ones.
It is possible for routers to grief users by locking up user liquidity for the duration of the
expiry. This can happen if the router commits to making a transaction, the user submits a
prepare tx on the origin chain, but the router never submits a corresponding
prepare on the destination chain.
Note that this lockup explicitly only exists in malicious cases, as the router possesses the ability to
cancel the sender's prepare on the origin chain.
In the short term, there is a whitelist for routers in the core contracts which the Connext team has the ability to update. The Connext team expects to work closely with an initial set of pilot routers that are trustworthy and reputationally disincentivized to attempt to grief users.
In the medium to long term, we are implementing a slashing mechanism to penalize routers that do not complete transactions that they have committed to. When this is implemented, the Connext team will burn their admin key for the router whitelist, enabling any router to join the system permissionlessly.