Thor: A Virtual Payment Channel Network Construction Protocol over Cryptocurrencies

Abstract

Payment Channel Networks (PCNs) have been proposed as a second-layer solution to the scalability issue of blockchain-based cryptocurrencies, most developed systems still lack effective strategies for further scalability solutions. Virtual payment channel (VPC) has been proposed as an off-chain technique that avoids the involvement of intermediaries for payments in a PCN. However, there is no research on how to efficiently construct VPCs while considering the characteristics of the underlying PCN. To fill this void, this paper focuses on the VPC construction in a PCN. More specifically, we propose a metric, Capacity to the Number of Intermediaries Ratio (CNIR), to consider both the capacity of the constructed VPC and the collateral locked by the involved users. We first study the VPC construction problem for a single pair of users and design an efficient algorithm that achieves the optimal CNIR. Based on this, we propose Thor, a protocol that constructs a virtual payment channel network (VPCN) for multiple pairs. Evaluation results show that Thor can efficiently construct a VPCN and outperform baseline algorithms in terms of the CNIR.