Authenticated Key Exchange over Bitcoin

Abstract

Abstract. Bitcoin is designed to protect user anonymity (or pseudonymity) in a financial transaction, and has been increasingly adopted by major e-commerce websites such as Dell, PayPal and Expedia. While the anonymity of Bitcoin transactions has been extensively studied, little attention has been paid to the security of post-transaction correspondence. In a commercial ap-plication, the merchant and the user often need to engage in follow-up corre-spondence after a Bitcoin transaction is completed, e.g., to acknowledge the receipt of payment, to confirm the billing address, to arrange the product de-livery, to discuss refund and so on. Currently, such follow-up correspondence is typically done in plaintext via email with no guarantee on confidentiality. Obviously, leakage of sensitive data from the correspondence (e.g., billing ad-dress) can trivially compromise the anonymity of Bitcoin users. In this paper, we initiate the first study on how to realise end-to-end secure communica-tion between Bitcoin users in a post-transaction scenario without requiring any trusted third party or additional authentication credentials. This is an important new area that has not been covered by any IEEE or ISO/IEC se-curity standard, as none of the existing PKI-based or password-based AKE schemes are suitable for the purpose. Instead, our idea is to leverage the Bit-coin’s append-only ledger as an additional layer of authentication between previously confirmed transactions. This naturally leads to a new category of AKE protocols that bootstrap trust entirely from the block chain. We call this new category “Bitcoin-based AKE ” and present two concrete protocols: one is non-interactive with no forward secrecy, while the other is interactive with additional guarantee of forward secrecy. Finally, we present proof-of-concept prototypes for both protocols with experimental results to demonstrate their practical feasibility.