Peer Selection Techniques for Enhanced Transaction Propagation in Bitcoin Peer-to-Peer Network

Abstract

The Bitcoin protocol, based on a peer-to-peer network enables transactions and blocks to be propagated to all the nodes in a decentralized manner. The information is verified and stored across the nodes as a distributed data ledger, the Blockchain. A node can have a maximum of 8 outgoing connections. The selection of outgoing connections are carried out in a random manner and information is broadcasted to these nodes by flooding. Transaction propagation delays in the network results in temporary inconsistencies in the ledger information resulting in blockchain forks. These can lead to possible double spending attacks. This paper addresses the issue of transaction propagation delay in the network. We present a simulation model of Bitcoin network. The effect of varying the number of outgoing connections and its implication in propagation delay is analyzed to determine the optimum limit of outgoing connections. Further, the idea of selection of nodes based on combination of two parameters, proximity to the sending node and random selection and its effect on transaction propagation delay is explored. Simulation results prove that this method further decreases transaction propagation delay.