On Conditional Cryptocurrency With Privacy

Abstract

In this paper, we present the design and implementation of a conditional cryptocurrency system with privacy protection. Unlike the existing approaches that often depend on smart contracts where cryptocurrencies are first locked in a vault, and then released according to event triggers, the conditional cryptocurrency system encodes event outcome as part of a cryptocurrency note in a UTXO based system. Without relying on any triggering mechanism, the proposed system separates event processing from conditional coin transaction processing where conditional cryptocurrency notes can be transferred freely in an asynchronous manner, only with their asset values conditional to the linked event outcomes. The main advantage of such design is that it enables free trade of conditional assets and prevents assets from being locked. In this work, we demonstrate a method of confidential conditional coin by extending the Zerocoin data model and protocol. The system is implemented and evaluated using xJsnark.