BEP-333: BNB Chain Fusion

BEPs/BEP333.md

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+<pre>
+  BEP: 333
+  Title: BNB Chain Fusion
+  Status: Draft
+  Type: Standards
+  Created: 2023-11-29
+</pre>
+
+# BEP-333: BNB Chain Fusion
+
+[BEP-333: BNB Chain Fusion](#bep-333-bnb-chain-fusion)
+  - [1. Summary](#1-summary)
+  - [2. Abstract](#2-abstract)
+  - [3. Status](#3-status)
+  - [4. Motivation](#4-motivation)
+  - [5. Specification](#5-specification)
+      - [5.1 Introduction](#51-introduction)
+      - [5.2 Multiple Phases](#52-multiple-phases)
+  - [6. License](#6-license)
+
+## 1. Summary
+
+This BEP proposes to securely and smoothly transit the BNB Beacon Chain
+and BNB Smart Chain (BSC) from a dual-chain structure into a single chain
+structure and decommission the Beacon Chain.
+
+## 2. Abstract
+
+BNB Chain Fusion (BC Fusion) is a major achievement for BNB Chain. It
+helps overcome legacy services and technical debt, enabling faster
+iteration and development. BC Fusion includes three sub-BEPs:
+
+- [BEP-294: BSC Native Staking](https://github.com/bnb-chain/BEPs/pull/294)
+
+- [BEP-297: BSC Native Governance](https://github.com/bnb-chain/BEPs/pull/297)
+
+- [BEP-299: Token Migration after BC Fusion](https://github.com/bnb-chain/BEPs/pull/299)
+
+This BEP primarily proposes strategic planning and coordination for
+organizing these BEPs. The goal is to facilitate the secure and seamless
+implementation of BC Fusion.
+
+## 3. Status
+
+This BEP is a draft.
+
+## 4. Motivation
+
+BNB Beacon Chain is a blockchain developed by the BNB Chain community
+that implements a vision of a decentralized exchange (DEX) for digital
+assets. Besides this, Beacon Chain and BSC is a dual-chain structure:
+Beacon Chain helps to enhance the security of BSC as a staking and
+governance layer. With the rise of various other forms of Dex,
+order-book based decentralized exchange was decommissioned in
+[BEP151](https://github.com/bnb-chain/BEPs/blob/master/BEPs/BEP151.md).
+With the quick evolution of BSC, the Beacon Chain has become a burden.
+The cross-chain bridge that connects the two chains slows down the
+development iteration and always exposes BNB to a certain level of
+security vulnerabilities. It\'s time to take a step further and migrate
+the functionality of Beacon Chain to BSC, allowing Beacon Chain to
+retire.
+
+## 5. Specification
+
+### 5.1 Introduction
+
+The Beacon Chain currently possesses several key functionalities:
+
+1. Cryptocurrency management platform. The Beacon Chain mainnet
+   currently supports a hundred kinds of [BEP2](https://explorer.bnbchain.org/assets/bep2)
+   and [BEP8](https://explorer.bnbchain.org/assets/bep8)
+   tokens. These tokens have value and can be circulated on the
+   Beacon Chain or transferred across different chains using
+   protocols such as [BEP3](https://github.com/bnb-chain/BEPs/blob/master/BEPs/BEP3.md).
+
+2. The staking layer of BSC. The BSC utilizes the POSA consensus
+   algorithm. It delegates staking election and reward distribution
+   functions to the Beacon Chain. This design choice was based on the
+   fact that the Beacon Chain is built on the cosmos-sdk
+   architecture, which already includes a well-developed staking
+   module that can be reused.
+
+3. The governance layer of BSC. For similar reasons, the governance
+   functionality of BSC is delegated to the Beacon Chain as well. The
+   governance vote and tally happen on Beacon Chain, and the
+   execution plan is delivered to the BSC through cross chain
+   communication protocol.
+
+Therefore, we have three separate BEPs that discuss how to migrate these
+functionalities or valuable assets to BSC.
+
+1. [BEP-299](https://github.com/bnb-chain/BEPs/pull/299):
+   This BEP presents a secure and trustless way for users to recover
+   their assets on the BSC once the Beacon chain stops running.
+
+2. [BEP-294](https://github.com/bnb-chain/BEPs/pull/294):
+   This BEP allows BNB holders to stake BNB to the specified
+   validators and get staking rewards on the BSC side directly. To
+   ensure network security, the migration of Staking voting power is
+   designed to be seamless. This means that both the Beacon Chain and
+   BSC\'s staking modules will coexist and function simultaneously
+   during the migration process.
+
+3. [BEP297](https://github.com/bnb-chain/BEPs/pull/297):
+   This BEP allows community members to submit proposals directly on
+   the BSC network. The governance module is fully compatible with
+   [Tally](https://www.tally.xyz/).
+
+### 5.2 Multiple Phases
+
+To accomplish BC Fusion, there will be several preparation and
+post-action steps involved, connecting these BEPs together. Thus, BC
+Fusion is divided into multiple stages:
+
+![multiple phases](./assets/bep-333/phases.png)
+
+#### 5.2.1 First Sunset Fork
+
+Due to the requirement of returning cryptocurrency to the user\'s wallet
+in order to migrate funds to BSC through
+[BEP-299](https://github.com/bnb-chain/BEPs/pull/299). The
+Beacon Chain will disable specific types of transactions to encourage
+users to keep their funds in their own wallets. The following types of
+Beacon chain transactions will be disabled: **TimeLockMsg**,
+**TimeRelockMsg**, **FreezeMsg**, **IssueMsg**, **MintMsg**,
+**IssueMiniMsg**, **HTLTMsg**, **DepositHTLTMsg**.
+
+During the migration process, Beacon Chain prohibits the creation and
+editing of validators to prevent conflicts with validators created on
+BSC side. New delegations will also be prohibited. 
+The following types of Beacon chain transactions will be
+disabled: **MsgCreateValidatorOpen**, **MsgCreateSideChainValidator**,
+**MsgCreateSideChainValidatorWithVoteAddr**,
+**MsgEditSideChainValidatorWithVoteAddr**, **MsgSideChainDelegate**,
+**MsgSideChainReDelegate**.
+
+To ensure that the voting power migration process is not maliciously
+manipulated, the Governance module will be automatically disabled when
+the voting power is below 5M BNB.
+
+The above-mentioned features will be enabled in Beacon Chain
+**FirstSunsetFork**.
+
+#### 5.2.2 BSC Feynman Hardfork
+
+[BEP-294](https://github.com/bnb-chain/BEPs/pull/294),
+[BEP-297](https://github.com/bnb-chain/BEPs/pull/297) and
+[BEP-299](https://github.com/bnb-chain/BEPs/pull/299) will
+be deployed in the BSC **Feynman** hard fork.
+
+1. [BEP-294](https://github.com/bnb-chain/BEPs/pull/294)
+   will take effect immediately. Validators created on BSC will
+   receive double voting power when staking an equal amount of BNB.
+   This encourages the transfer of voting power from the Beacon Chain
+   to BSC.
+
+2. The [BEP-297](https://github.com/bnb-chain/BEPs/pull/297)
+   governance functionality will not be activated immediately after
+   the hardfork. It will only be automatically enabled once more than
+   10 million BNB are migrated to BSC.
+
+3. The smart contract of [BEP-299](https://github.com/bnb-chain/BEPs/pull/299)
+   is not available as the merkel root in the smart contract is still
+   empty at this time. Only after the Beacon Chain comes to a
+   complete halt, the Token Migration feature will be initiated by
+   setting the Merkle root for balance dump through governance.
+
+4. Cross-chain re-delegation, which allows users to un-delegate their stakes
+   from Beacon Chain and then delegate them on BSC in one Beacon Chain transaction, 
+   will be enabled after governance opening the related cross-chain channel.
+
+An important wallet will be introduced in this hardfork:
+**AssetProtector.** **AssetProtector** is a multi-signature wallet
+controlled by the core dev team at the beginning. It can:
+
+- Pause and unpause the staking, governance and token migration
+  contract in emergency situations.
+
+- Forbidden a specific account to perform any operations in the
+  staking contract.
+
+#### 5.2.3 Second Sunset Fork
+
+After transferring more than two-thirds of the voting power to BSC, the
+Beacon Chain must restrict additional transaction types and
+automatically execute specific logic to ensure the return of funds to
+users\' wallets. The following transactions will be disabled:
+**MsgSideChainSubmitProposal**.
+
+All TimeLock and AtomicSwap will automatically be refunded to the
+user\'s wallet. All the BSC delegation will be undelegated
+automatically, if the delegation comes through
+[BEP153](https://github.com/bnb-chain/BEPs/blob/master/BEPs/BEP153.md),
+the funds will be sent back to the BSC network.
+
+#### 5.2.4 Final Sunset Fork
+
+Before executing Final Sunset, users still have the opportunity to
+transfer funds across chains. However, after Final Sunset, cross-chain
+communication between the Beacon Chain and BSC will be completely
+stopped.
+
+After Sunset Fork, the validators in the Beacon Chain community will
+gradually shut down, and the entire chain will no longer accept new
+transactions or propose new blocks.
+
+Some of the funds will be permanently locked:
+
+1. The total amount of staking funds for validators on the Beacon Chain
+   itself is approximately 110k BNB.
+
+2. On the Beacon Chain, the BEP2/BEP8 tokens that are not mirrored or
+   bound to BSC.
+
+3. The [BEP153](https://github.com/bnb-chain/BEPs/blob/master/BEPs/BEP153.md)
+   staking reward that is less than 0.1BNB or staked value which is
+   less than 0.01BNB will be locked forever.
+
+**All these funds are not recoverable after the Final Sunset Fork.**
+
+#### 5.2.5 Post BC Fusion
+
+- The core dev team will dump the ledger of Beacon Chain and generate
+  a merkle tree. The data will be publicly reviewed for about 1
+  month.
+
+- A governance proposal will be submitted to set the merkel root and
+  approver account of the token migration contract.
+
+- A dapp will be provided for token migration from Beacon Chain to
+  BSC.
+
+- All the blockchain data of Beacon Chain will be uploaded to
+  Greenfield, Filecoin and Arweave for archive.
+
+## 6. License
+
+The content is licensed under [CC0](https://creativecommons.org/publicdomain/zero/1.0/).