Threshold EdDSA Signature for Blockchain-based Decentralized Finance Applications

Abstract

The threshold digital signature technique is important for decentralized finance (DeFi) applications such as asset custody and cross-chain interoperations. The Edwards-curve digital signature algorithm (EdDSA) is widely used in blockchains, e.g., Libra/Diem; however, no suitable threshold solution exists. Therefore, to bridge this gap, we propose a threshold EdDSA that allows n parties to generate keys in a decentralized and distributed manner. Any t + 1-of-n parties can generate standard EdDSA signatures. This scheme supports an arbitrary threshold (t, n) and has been proven to be secure against at most t malicious adversaries. The theoretical analysis (computation complexity and communication footprints) and experimental results demonstrate that the proposed scheme performs efficiently on cloud servers and embedded devices. Furthermore, the proposed scheme is integrated with Tendermint, a blockchain framework that uses EdDSA, to generate keys and sign transactions in a decentralized manner, which indicates that this scheme is compatible with blockchains for supporting DeFi applications.