Crypto exchange and wallet testing

What crypto exchange and wallet testing covers

Deposit detection and confirmations

For crypto exchanges and custodial wallets, a deposit becomes client money when the ledger credits it. A credit that a client withdraws before a reorganisation removes it is paid from the exchange's own holdings. Tests per chain and token:

• Detection. Native transfers, token transfers from contract event logs, value sent by a contract call, and one Bitcoin transaction paying several deposit addresses each credit once, to the right client.
• Credit state by depth. A deposit stays pending until the configured threshold. On Ethereum, tests compare crediting at the latest, safe, and finalized block tags of the JSON-RPC API.
• Memo or tag deposits. A deposit with a missing tag on a shared address goes to suspense and credits no client.

Reorganisation handling

On Bitcoin regtest, invalidateblock removes the block holding a credited deposit. Tests check that a dropped transaction reverses through an entry linked to the original, that a transaction mined again in another block keeps one credit (the deduplication key is transaction ID and output index), and that a double spend after the client traded the credit shows as a negative balance in the break report. On Ethereum, when the chain has not finalized for more than four epochs, the inactivity leak starts (rewards and penalties), so tests also run while the finalized tag stops advancing. The crypto deposit reorg testing guide lists the node calls.

Withdrawal approval and signing

A broadcast withdrawal cannot be reversed, so tests stop defects before the signer:

• Approval quorum. The requester cannot approve their own request, an approval bound to a payload hash fails when the amount or destination changes, and a policy change needs the quorum.
• MPC threshold signing. With key share nodes offline below the threshold, the withdrawal stays retriable, and a retry after a signer timeout with the same idempotency key broadcasts one transaction.
• Multisig. For Bitcoin multisig built on BIP 174 partially signed transactions, an output altered between two signers is refused by the second signer's policy check.
• Nonces. Two Ethereum withdrawals with one nonce let one replace the other, and a nonce gap holds every later withdrawal from that wallet.

MiCA Article 75(8) makes a custodian liable to clients for the loss of crypto-assets or of the means of access from an incident attributable to it, capped at market value when the loss occurred (Regulation (EU) 2023/1114). The MiCA testing requirements page maps Article 75 to evidence.

Fee estimation and stuck transactions

The fee charged to the client and the network fee paid are separate ledger entries. Under EIP-1559, the base fee moves by at most one eighth per block, and a transaction with a max fee per gas below the base fee cannot be included. Tests raise the base fee between quote and broadcast and check one replacement with the same nonce and one payout booked with the fee paid. Bitcoin Core 28.0 (2 October 2024) set -mempoolfullrbf to 1 by default; tests bump a stuck withdrawal and check that the dropped original triggers no second payout.

Address validation and travel rule data

BIP 350 requires Bech32 for witness version 0 and Bech32m for versions 1 to 16. EIP-55 adds a mixed-case checksum that an all-lowercase address lacks. Tests submit a Taproot address with a Bech32 checksum, a testnet address, and a mistyped EIP-55 address.

Under Regulation (EU) 2023/1113, the originator's provider submits the Article 14(1) and 14(2) data in advance of, or simultaneously with, the transfer (14(4)), and neither allows initiation of nor executes a transfer until every Article 14 obligation is met (14(8)). For a transfer exceeding EUR 1,000 to or from a self-hosted address, the provider takes adequate measures to assess whether its client owns or controls the address (14(5), 16(2)). In Canada, an entity keeping records of virtual currency transfers includes both parties' name, address, and any account or reference number (Regulations s. 124.1(1)); see FINTRAC testing requirements. Tests block signing when a field is missing and capture IVMS 101 payloads.

Staking reward accounting

Ethereum validators with 0x01 credentials have balance above 32 ETH swept to the withdrawal address, while 0x02 validators compound rewards up to 2048 ETH (staking withdrawals), so a reward job counting only withdrawals credits nothing for 0x02 validators. Tests check that commission is deducted once, that allocation uses each epoch's balance snapshot, that balances stay locked through exit, and that each reward reaches the register of positions, where Article 75(4) records any event likely to modify a client's rights immediately. Reward exports carry UTC timestamp, amount, and commission for crypto tax software.