Subscribe to the gold package and get unlimited access to Shamra Academy
Register a new userAn Evaluation of Cryptocurrency Payment Channel Networks and Their Privacy Implications
72
0
0.0
(
0
)
Added by
Suat Mercan
Publication date
2021
fields
Informatics Engineering
and research's language is
English
Ask ChatGPT about the research
No Arabic abstract
Cryptocurrencies redefined how money can be stored and transferred among users. However, independent of the amount being sent, public blockchain-based cryptocurrencies suffer from high transaction waiting times and fees. These drawbacks hinder the wide use of cryptocurrencies by masses. To address these challenges, payment channel network concept is touted as the most viable solution to be used for micro-payments. The idea is exchanging the ownership of money by keeping the state of the accounts locally. The users inform the blockchain rarely, which decreases the load on the blockchain. Specifically, payment channel networks can provide transaction approvals in seconds by charging a nominal fee proportional to the payment amount. Such attraction on payment channel networks inspired many recent studies which focus on how to design them and allocate channels such that the transactions will be secure and efficient. However, as payment channel networks are emerging and reaching large number of users, privacy issues are becoming more relevant that raise concerns about exposing not only individual habits but also businesses revenues. In this paper, we first propose a categorization of the existing payment networks formed on top of blockchain-backed cryptocurrencies. After discussing several emerging attacks on user/business privacy in these payment channel networks, we qualitatively evaluate them based on a number of privacy metrics that relate to our case. Based on the discussions on the strengths and weaknesses of the approaches, we offer possible directions for research for the future of privacy based payment channel networks.
rate research
Read More
The last decade has experienced a vast interest in Blockchain-based cryptocurrencies with a specific focus on the applications of this technology. However, slow confirmation times of transactions and unforeseeable high fees hamper their wide adoption for micro-payments. The idea of establishing payment channel networks is one of the many proposed solutions to address this scalability issue where nodes, by utilizing smart contracting, establish payment channels between each other and perform off-chain transactions. However, due to the way these channels are created, both sides have a certain one-way capacity for making transactions. Consequently, if one sides exceeds this one-way capacity, the channel becomes useless in that particular direction, which causes failures of payments and eventually creates an imbalance in the overall network. To keep the payment channel network sustainable, in this paper, we aim to increase the overall success rate of payments by effectively exploiting the fact that end-users are usually connected to the network at multiple points (i.e., gateways) any of which can be used to initiate the payment. We propose an efficient method for selection of the gateway for a user by considering the gateways inbound and outbound payment traffic ratio. We then augment this proposed method with split payment capability to further increase success rate especially for large transactions. The evaluation of the proposed method shows that compared to greedy and maxflow-based approaches, we can achieve much higher success rates, which are further improved with split payments.
Blockchain-based cryptocurrencies received a lot of attention recently for their applications in many domains. IoT domain is one of such applications, which can utilize cryptocur-rencies for micro payments without compromising their payment privacy. However, long confirmation times of transactions and relatively high fees hinder the adoption of cryptoccurency based micro-payments. The payment channel networks is one of the proposed solutions to address these issue where nodes establish payment channels among themselves without writing on blockchain. IoT devices can benefit from such payment networks as long as they are capable of sustaining their overhead. Payment channel networks pose unique characteristics as far as the routing problem is concerned. Specifically, they should stay balanced to have a sustainable network for maintaining payments for longer times, which is crucial for IoT devices once they are deployed.In this paper, we present a payment channel network design that aims to keep the channels balanced by using a common weight policy across the network. We additionally propose using multi-point connections to nodes for each IoT device for unbalanced payment scenarios. The experiment results show that we can keep the channels in the network more equally balanced compared to the minimal fee approach. In addition, multiple connections from IoT devices to nodes increase the success ratio significantly.
This paper initiates the study of demand-aware payment channel networks: offchain cryptocurrency networks whose topology is optimized toward the demand (i.e., financial transactions) it currently serves. In particular, we present a model and optimization framework which allows to compute where to optimally establish virtual payment channels: virtual payment channels allow to avoid intermediaries when routing payments, and hence to reduce fees and latency; however, establishing payment channels also comes at a cost.
Payment channel networks are a promising approach to improve the scalability of cryptocurrencies: they allow to perform transactions in a peer-to-peer fashion, along multi-hop routes in the network, without requiring consensus on the blockchain. However, during the discovery of cost-efficient routes for the transaction, critical information may be revealed about the transacting entities. This paper initiates the study of privacy-preserving route discovery mechanisms for payment channel networks. In particular, we present LightPIR, an approach which allows a source to efficiently discover a shortest path to its destination without revealing any information about the endpoints of the transaction. The two main observations which allow for an efficient solution in LightPIR are that: (1) surprisingly, hub labelling algorithms - which were developed to preprocess street network like graphs so one can later efficiently compute shortest paths - also work well for the graphs underlying payment channel networks, and that (2) hub labelling algorithms can be directly combined with private information retrieval. LightPIR relies on a simple hub labeling heuristic on top of existing hub labeling algorithms which leverages the specific topological features of cryptocurrency networks to further minimize storage and bandwidth overheads. In a case study considering the Lightning network, we show that our approach is an order of magnitude more efficient compared to a privacy-preserving baseline based on using private information retrieval on a database that stores all pairs shortest paths.
Blockchain-based cryptocurrencies, facilitating the convenience of payment by providing a decentralized online solution, have not been widely adopted so far due to slow confirmation of transactions. Offline delegation offers an efficient way to exchange coins. However, in such an approach, the coins that have been delegated confront the risk of being spent twice since the delegators behaviour cannot be restricted easily on account of the absence of effective supervision. Even if a third party can be regarded as a judge between the delegator and delegatee to secure transactions, she still faces the threat of being compromised or providing misleading assure. Moreover, the approach equipped with a third party contradicts the real intention of decentralized cryptocurrency systems. In this paper, we propose textit{DelegaCoin}, an offline delegatable cryptocurrency system to mitigate such an issue. We exploit trusted execution environments (TEEs) as decentralized virtual agents to prevent malicious delegation. In DelegaCoin, an owner can delegate his coins through offline-transactions without interacting with the blockchain network. A formal model and analysis, prototype implementation, and further evaluation demonstrate that our scheme is provably secure and practically feasible.
Log in to be able to interact and post comments
comments
Fetching comments
Sign in to be able to follow your search criteria
