Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

Annotations already cover the safety profile (readOnlyHint, idempotentHint, destructiveHint=false), so the bar is lower. The description adds real behavioral context beyond them: tracing halts at labelled entities (exchanges, mixers, services) and results carry hop distance, which tells the agent how far the walk goes and what it returns. It does not mention rate limits or cost, keeping it short of a 5.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Is the description appropriately sized, front-loaded, and free of redundancy?

Three short sentences, front-loaded with the core mechanic and terminated with the direction constraint. The sentence 'Answers source-of-funds questions' largely restates the preceding clause, a minor redundancy.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

With no output schema, the description usefully discloses the shape of the result (labelled entities plus hop distance) and the stopping condition, which is what an agent needs. It stops short of describing result ordering or how deep traces behave at the max_hops boundary.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema description coverage is 100%, so chain, address and max_hops are already documented with the enum values and the 1-8 bound. The description only alludes to hop-walking ('walk backwards') without adding format or default guidance beyond the schema. Baseline 3 applies.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Does the description clearly state what the tool does and how it differs from similar tools?

States a specific verb and resource ('walk an address's INCOMING funds backwards') and defines the terminal scope ('stops at labelled entities... with hop distance'). The emphasis on incoming/backwards direction functionally distinguishes it from the sibling trace_funds, so an agent can pick the right tracer without opening either schema.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Does the description explain when to use this tool, when not to, or what alternatives exist?

Gives a clear use case: 'Answers source-of-funds questions' and 'where did this wallet's money come from'. That is a clear when-to-use context, but no exclusions or sibling alternatives (e.g. trace_funds for the opposite direction) are named.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.