Potential problems with contracts

The Marlowe language is designed to have as few as possible pitfalls and gotchas, so that contracts can be written intuitively, avoiding any surprises. Nevertheless, it is impossible by design to exclude all contracts that should not be written, without making Marlowe much harder to use. Moreover, even when a contract is well written, it is still possible for its users to interact with it in invalid ways, by issuing invalid transactions.

In all cases, when these unintended effects happen, Marlowe is designed to behave in the most intuitive and conservative way possible. However, it is worth being aware of these potential problems, and review how Marlowe behaves in these situations. That is the subject of this tutorial.


Marlowe warnings are indications that a contract is written wrongly. A well-written contract should never issue a warning, no matter how the users interact with it. Ideally, we would like to forbid contracts that can issue warnings from being ever written, but that would require Marlowe contracts to be dependently-typed, and writing expressions that are dependently-typed is much more cumbersome.

Instead, Marlowe allows contracts that issue warning to be written, and we provide static analysis tools that let contract developers check whether a particular contract can possibly issue warnings. Additionally, we provide fall-back behaviours for when a contract produces a warning, despite our advice. We provide fall-back behaviours because we acknowledge that analysing big contracts can be very computationally expensive, and because mistakes can be made. We want badly written contracts to fail in the most harmless way possible, that is conservatively.

Non-positive payments

When a contract is supposed to pay an amount of money that is less than one unit of a currency or token, it will issue a NonPositivePay warning, and it will not transfer any money.

Negative payments should be implemented as either positive deposits (when paying a participant), or positive payments in the opposite direction (when paying between accounts).

Non-positive deposits

When a contract is supposed to expect an amount of money that is less than one unit of a currency of token, it will still wait for a IDeposit transaction, but that transaction does not need to transfer any money into the contract and no money is transferred to the participant that issues the transaction. Once this ‘fake’ deposit is successful, the contract will issue a NonPositiveDeposit warning.

Negative deposits should always be implemented as positive payments.

Partial payment

When a contract is supposed to pay an amount of money that is larger than the amount of money that there is in the source account, it will just transfer whatever is available in that account, even if there is enough money in all the accounts of the contract, and it will issue a PartialPay warning.

Partial payments should be avoided because a contract that never produces a partial payment is an explicit contract. Explicit contracts reassure their users that they will be enforceable, and that wherever in the contract it says a payment is going to happen it will indeed happen.

Let shadowing (not covered by static analysis)

When a contract reaches a Let construct that re-defines a value with an identifier that was already defined by an outer Let, the contract will issue a Shadowing warning, and it will override the previous definition.

Shadowing is a bad programming practice because it leads to confusion. Using the same identifier for more than one thing can mislead developers or users into thinking that one usage of Use is going to be evaluated to one amount while it is actually going to be evaluated to some other different amount.

Bad smells

There are some other ‘bad smells’ that indicate that a contract has probably been poorly designed.

These contracts are valid, in the sense that they will not necessarily cause any warnings, and they do what they say that they do, but they have characteristics that suggest that either the contract developer was not fully aware of the consequences of the contract, or that the developer purposefully wrote the contract in a way that was confusing for the reader.

Undefined Let usage (should be a warning)

When a Use construct uses an identifier that has not been defined yet, it will evaluate to the default value of 0. No warning will be issued but, again, this is a bad practice because it can be misleading. (Constant 0) should be used instead since it makes explicit the amount in question.

Unreachable parts of a contract

This is the main bad smell in Marlowe contracts. If part of the contract is unreachable, why would it have been included in the first place?

This bad smell takes a number of shapes.

Sub-Contract is not reachable

For example:

If FalseObs contract1 contract2

The previous contract is equivalent to contract2. In general you should never use FalseObs, and you should only use TrueObs as the root observation of a Case construct.

Observation is always short-cut

For example:

OrObs TrueObs observation1

The previous observation is equivalent to observation1. Again, you should only use TrueObs as the root observation of a Case construct.

When branch is unreachable

For example:

When [ Case (Notify TrueObs) contract1
     , Case (Notify TrueObs) contract2 ]

contract2 is unreachable, the whole Case could be removed from the contract and the behaviour would be the same.

Nested non-increasing timeouts

For example:

When []
     When [ Case (Notify TrueObs)
                 contract1 ]

contract1 is unreachable: after block 10, the contract will directly evolve into contract2. The inner When does not make any difference to the contract.

Usability issues

Even if a contract avoids warnings, and has no unreachable code, it may still allow malicious users to force other users into undesirable situations that were not originally intended by developer of the contract.

Bad timing of When constructs

Consider the following contract:

When [Case (Choice (ChoiceId "choice1" (Role "alice")) [Bound 0 10])
           (When [Case (Choice (ChoiceId "choice2" (Role "bob")) [Bound 0 10])
            (Pay (Role "bob") (Party (Role "alice"))
                 (Constant 10)

There is nothing wrong in principle with this contract, but if (Role "alice") makes her choice on block 9, it will be virtually impossible for bob to make his choice on time and get the refund of the money in his account (Role "bob"). Unless, this is part of a game and that is an intended effect, this is likely an unfair contract for (Role "bob").

In general, it is a good practice to ensure that When constructs have increasing timeouts, and that the increase between timeouts is reasonable for the different parties to issue and get their transactions accepted by the blockchain. There are many reasons why the participation of a party may be delayed: an energy supply failure, a sudden peak in the number of pending transactions in the blockchain, network attacks, etc. So it is important to allow plenty of time, and to be generous with timeouts and with increases in timeouts.


Finally, even if a contract is perfectly written. Users may use it incorrectly, and we call those incorrect usages errors.

In all cases, whenever a transaction causes an error, the transaction will have no effect on the Contract or on its State. In fact, the wallet of a user will know in advance whether a transaction is going to produce an error, because transactions are deterministic, so users should never need to send an erroneous transaction to the blockchain.

Ambiguous interval

When a transaction reaches a timeout, its slot interval must be unambiguous about whether the timeout has passed or not. For example, if the top-most When of a contract has timeout 10 and a transaction with slot interval [6, 14] is issued, the transaction will cause an AmbiguousSlotIntervalError error, because it is impossible to know whether the timeout has passed just by looking at the transaction. To avoid this, the transaction must be split into two separate transactions:

  1. One with slot interval [6, 9].

  2. Another one with slot interval [10, 14].

Apply no-match

If a transaction does not provide the inputs that are expected by the Contract, then the contract will issue a NoMatchError error, and the whole transaction will be discarded.

Useless transaction

If a transaction does not have any effect on the Contract or State, it will result on a UselessTransaction error, and the whole transaction will be discarded. The reason why we discard useless transactions is that they open the door to Denial of Service (DoS) attacks, because a potential attacker could flood the contract with unnecessary transactions and prevent necessary transactions to make it into the blockchain.