Ethereum's current Gasper consensus mechanism, which combines the Latest Message Driven Greediest Heaviest Observed SubTree (LMD-GHOST) fork choice rule with the probabilistic Casper the Friendly Finality Gadget (FFG) finality overlay, finalizes transactions in 64 to 95 blocks, an approximate 15-minute delay. This finalization latency impacts user experience and exposes the network to short-term chain reorganization risks, potentially enabling transaction censorship or frontrunning by validators without severe penalties. As the ecosystem pursues a rollup-centric roadmap to scale Ethereum into a secure global settlement layer, faster finality allows cross-layer and inter-rollup communication with greater immediacy, reducing capital inefficiencies. Single slot finality (SSF), wherein transactions are finalized within the same slot they are proposed, promises to advance the Ethereum protocol and enable better user experiences by enabling near-instant economic finality. This thesis systematically studies distributed consensus protocols through propose-vote-merge, PBFT-inspired, and graded agreement families - scrutinizing their capacities to enhance or replace LMD-GHOST. The analysis delves into the intricate tradeoffs between safety, liveness, and finality, shedding light on the challenges and opportunities in designing an optimal consensus protocol for Ethereum. It also explores different design decisions and mechanisms by which single slot or fast finality can be enabled, including cumulative finality, subsampling, and application-layer fast finality. Furthermore, this work introduces SSF-enabled and streamlined fast finality constructions based on a single-vote total order broadcast protocol. The insights and recommendations in this thesis provide a solid foundation for the Ethereum community to make informed decisions regarding the future direction of the protocol's consensus.
We study long-term equilibria that arise in the token monetary policy, or tokenomics, design of proof-of-stake (PoS) blockchain systems that engage utility maximizing users and validators. Validators are system maintainers who get rewarded with tokens for performing the work necessary for the system to function properly, while users compete and pay with such tokens for getting a desired portion of the system service. <br/><br/>We study how the system service provision and suitable rewards schemes together can lead to equilibria with the following desirable characteristics (1) viability: the system keeps parties engaged, (2) decentralization and skin-in-the-game: multiple sufficiently invested validators are participating, (3) stability: the price path of the underlying token used to transact with the system does not change widely over time, and (4) feasibility: the mechanism is easy to implement as a smart contract, e.g., it does not require a fiat reserve on-chain to perform token buybacks or to perform bookkeeping of exponentially growing token holdings.<br/><br/>Our analysis enables us to put forward a novel generic mechanism for blockchain monetary policy that we call quantitative rewarding (QR). We investigate how to implement QR in single-token and two-token proof of stake (PoS) blockchain systems. The latter are systems that utilize one token for the users to pay the transaction fees and a different token for the validators to participate in the PoS protocol and get rewarded. Our approach demonstrates a concrete advantage of the two-token setting in terms of the ability of the QR mechanism to be realized effectively and provide good equilibria. Our analysis also reveals an inherent limitation of the single token setting in terms of implementing an effective blockchain monetary policy - a distinction that is, to the best of our knowledge, highlighted for the first time.licy - a distinction that is, to the best of our knowledge, highlighted for the first time.
In a blockchain network, a rule set called consensus mechanism is used to create and finalize a block. In a proof-of-stake (PoS), consensus-based blockchain network, nodes become validators, minters, or stakeholders’ nodes to complete the consensus mechanism. In these networks, when a node becomes a validator node, its details need to be saved because the details of the validators are used in the network for many important decisions, such as selecting block proposers for the consensus process. In this paper, we present Sea Shield, which uses a validator chain to save a node’s information when it becomes a validator or leaves its responsibility as a validator in the PoS-based blockchain network. The validator chain is a blockchain that can run with the main chain of a PoS-based blockchain. The internal features of the validator chain are similar to those of the blockchain. We designed and simulated a consensus mechanism to create and finalize the block for the validator chain with no forks. We present a process by which a node may join or unjoin as a validator in a PoS-based blockchain network to improve the overall security of the main chain-consensus process.
As the potential of directed acyclic graph (DAG)-based distributed ledgers in IoT systems unfolds, a need arises to understand their intricate dynamics in real-world scenarios. It is well known that discrete event simulations can provide high-fidelity evaluations of protocols. However, there is a lack of public discrete event simulators capable of assessing DAG-based distributed ledgers. In this paper, a discrete-event-based distributed ledger simulator is introduced, with which we investigate a custom Python-based implementation of IOTA's Tangle DAG protocol. The study reveals the dynamics of Tangle (particularly Poisson processes in transaction dynamics), the efficiency and intricacies of the random walk in Tangle, and the quantitative assessment of node convergence. Furthermore, the research underscores the significance of weight updates without depth limitations and provides insights into the role, challenges, and implications of the coordinator/validator in DAG architectures. The results are striking, and although the findings are reported only for Tangle, they demonstrate the need for adaptable and versatile discrete event simulators for DAG architectures and tip selection methodologies in general.
Tao Yan, Shengnan Li, Benjamin Kraner, Luyao Zhang · 5 authors
Ethereum 2.0, as the preeminent smart contract blockchain platform, guarantees the precise execution of applications without third-party intervention. At its core, this system leverages the Proof-of-Stake (PoS) consensus mechanism, which utilizes a stochastic process to select validators for block proposal and validation, consequently rewarding them for their contributions. However, the implementation of blockchain technology often diverges from its central tenet of decentralized consensus, presenting significant analytical challenges. Our study collects consensus reward data from the Ethereum Beacon chain and conducts a comprehensive analysis of reward distribution and evolution, categorizing them into attestation, proposer and sync committee rewards. To evaluate the degree of decentralization in PoS Ethereum, we apply several inequality indices, including the Shannon entropy, the Gini Index, the Nakamoto Coefficient, and the Herfindahl-Hirschman Index (HHI). Our comprehensive dataset is publicly available on Harvard Dataverse, and our analytical methodologies are accessible via GitHub, promoting open-access research. Additionally, we provide insights on utilizing our data for future investigations focused on assessing, augmenting, and refining the decentralization, security, and efficiency of blockchain systems.
Renan Lima Baima, Loïck Chovet, Eduard Hartwich, Abhishek Bera · 7 authors
In the new space economy, space agencies, large enterprises, and start-ups aim to launch space multi-robot systems (MRS) for various in-situ resource utilization (ISRU) purposes, such as mapping, soil evaluation, and utility provisioning. However, these stakeholders' competing economic interests may hinder effective collaboration on a centralized digital platform. To address this issue, neutral and transparent infrastructures could facilitate coordination and value exchange among heterogeneous space MRS. While related work has expressed legitimate concerns about the technical challenges associated with blockchain use in space, we argue that weighing its potential economic benefits against its drawbacks is necessary. This paper presents a novel architectural framework and a comprehensive set of requirements for integrating blockchain technology in MRS, aiming to enhance coordination and data integrity in space exploration missions. We explored distributed ledger technology (DLT) to design a non-proprietary architecture for heterogeneous MRS and validated the prototype in a simulated lunar environment. The analyses of our implementation suggest global ISRU efficiency improvements for map exploration, compared to a corresponding group of individually acting robots, and that fostering a coopetitive environment may provide additional revenue opportunities for stakeholders.
Krzysztof Gogol, Benjamin Kraner, Malte Schlosser, Tao Yan · 6 authors
Liquid staking has become the largest category of decentralized finance protocols in terms of total value locked. However, few studies exist on its implementation designs or underlying risks. The liquid staking protocols allow for earning staking rewards without the disadvantage of locking the capital at the validators. Yet, they are seen by some as a threat to the Proof-of-Stake blockchain security. This paper is the first work that classifies liquid staking implementations. It analyzes the historical performance of major liquid staking tokens in comparison to the traditional staking for the largest Proof-of-Stake blockchains. Furthermore, the research investigates the impact of centralization, maximum extractable value and the migration of Ethereum from Proof-of-Work to Proof-of-Stake on the tokens' performance. Examining the tracking error of the liquid stacking providers to the staking rewards shows that they are persistent and cannot be explained by macro-variables of the currency, such as the variance or return.
Iván Abellán Álvarez, Vincent Gramlich, Johannes Sedlmeir
With the increasing adoption of decentralized information systems based on a variety of permissionless blockchain networks, the choice of consensus mechanism is at the core of many controversial discussions. Ethereum's recent transition from proof-of-work (PoW) to proof-of-stake (PoS)-based consensus has further fueled the debate on which mechanism is more favorable. While the aspects of energy consumption and degree of (de-)centralization are often emphasized in the public discourse, seminal research has also shed light on the formal security aspects of both approaches individually. However, related work has not yet comprehensively structured the knowledge about the security properties of PoW and PoS. Rather, it has focused on in-depth analyses of specific protocols or high-level comparative reviews covering a broad range of consensus mechanisms. To fill this gap and unravel the commonalities and discrepancies between the formal security properties of PoW- and PoS-based consensus, we conduct a systematic literature review over 26 research articles. Our findings indicate that PoW-based consensus with the longest chain rule provides the strongest formal security guarantees. Nonetheless, PoS can achieve similar guarantees when addressing its more pronounced tradeoff between safety and liveness through hybrid approaches.
Vojislav B. Mišić, Soosan Naderi Mighan, Jelena Mišić, Xiaolin Chang
Proof-of-Stake (PoS) protocols are widely accepted as a viable substitute for the Proof-of-Work-based consensus, which is why recent blockchain-based cryptocurrencies and applications, most notably Ethereum 2.0, are using some variant of PoS as the basis for the consensus protocol. However, the implementation of PoS protocols in Ethereum 2.0 are not without its share of problems and vulnerabilities, especially with respect to the malicious behavior of validator nodes. In this paper, we first review the basic tenets of PoS protocols. We then discuss some of the recently described attacks on the Ethereum 2.0 consensus, and we also show that some of the design rationales adopted in PoS implementation—the decentralization of the voting process in particular—have, in actuality, enabled attacks that can be launched at a very low cost to the attacker. We also propose simple remedies that can reduce or eliminate the impact of those attacks and can evaluate the performance of the Ethereum 2.0 consensus when these remedies are applied.
Fueled by the growing popularity of proof-of-stake blockchains, there has been increasing interest and progress in permissioned consensus protocols, which could provide a simpler alternative to existing protocols, such as Paxos and PBFT. In particular, the recently proposed Streamlet protocol provides a surprisingly simple and streamlined consensus approach, which crystallizes years of research in simplifying and improving classical consensus protocols. While the simplicity of Streamlet is a major accomplishment, the protocol lacks certain practical features, such as supporting a stable block proposer, and it makes strong assumptions, such as synchronized clocks and the implicit echoing of all messages. Most importantly, it requires sending $O(N^3)$ messages per block in a network of $N$ nodes, which poses a significant challenge to its application in larger networks. To address these limitations, we introduce Pipelet, a practical streamlined consensus protocol. Pipelet employs the same block-finalization rule as Streamlet, but attains state-of-the-art performance in terms of communication complexity and provides features that are crucial for practical applications, such as clock synchronization and stable block proposers. At the same time, Pipelet retains the simplicity of Streamlet, which presents significant practical advantages, such as ease of implementation and verification.
Cross-chain dApps (decentralized applications) are enabled by smart contracts interoperability on heterogeneous blockchains. Previous work on cross-chain smart contract invocation has limitations in satisfying compatibility, atomicity, and security simultaneously. To address these limitations, this paper presents a new systemAtomCIthat enables atomic cross-chain smart contract invocations spanning heterogeneous blockchains. Our systemAtomCIis enabled by a synergy of three proposed components: (1) Smart Contract Design Patterns, (2) Cross-chain Expression Protocol, and (3) Cross-chain Service Community, which is based on smart contracts and provides honest and auditable cross-chain service. We implement a prototype ofAtomCIand analyze its security. Extensive results show thatAtomCIimposes reasonable cost and latency of end-to-end cross-chain smart contract invocations, and has less impact of locks on the contract availability. The analysis and evaluation demonstrate thatAtomCIis a promising approach to enable atomic smart contract invocations spanning heterogeneous blockchains.
In recent years, decentralized applications (dApps) built on blockchain platforms such as Ethereum and coded in languages such as Solidity, have gained attention for their potential to disrupt traditional centralized systems. Despite their rapid adoption, limited research has been conducted to understand the underlying code structure of these applications. In particular, each dApp is composed of multiple smart contracts, each containing a number of functions that can be called to trigger a specific event, e.g., a token transfer. In this paper, we reconstruct and analyse the network of contracts and functions calls within the dApp, which is helpful to unveil vulnerabilities that can be exploited by malicious attackers. We show how decentralization is architecturally implemented, identifying common development patterns and anomalies that could influence the system's robustness and efficiency. We find a consistent network structure characterized by modular, self-sufficient contracts and a complex web of function interactions, indicating common coding practices across the blockchain community. Critically, a small number of key functions within each dApp play a pivotal role in maintaining network connectivity, making them potential targets for cyber attacks and highlighting the need for robust security measures.
Blockchain makes heavy use ofcryptographic hashingto achieve integrity and consensus in a peer-to-peer network, but hashing causes some inefficiencies. For example, blockchain stores data with their hash digest as a key in the database, so the blockchain always reads and writes data in arandomorder. This can affect blockchain performance, especially for account-based blockchains such as Ethereum, which must maintain a huge, hash-based data structure for accounts, called thestate trie. Also, Proof-of-Work (PoW) consensus algorithm requires the miners to find a nonce that makes the block hash lower than a difficulty threshold, but ASICs with parallel hashing have made PoW use a large dataset such as theEthashDAG for memory-hardness and ASIC-resistance. Unfortunately, verification of the nonce is not easy for many light clients, which cannot deal with the overhead caused by the dataset. This paper proposes a novel PoW mining algorithm namedTrie-Hashimototo address these issues. Trie-Hashimoto adds a nonce field in a state trie node. It then makes the miners find a nonce of every newly-created trie node for a new block such that each node has a hash digest whoseprefixis equal to the block number. This can accelerate the database performance by storing the trie nodes in asequentialorder. The way for Trie-Hashimoto to achieve memory-hardness is also different. It uses the block headers that any client must maintain, obviating a separate dataset. Furthermore, it allows partial verification using a few Merkle proofs of accounts, so that a client with minimal resources or even a smart contract in another interoperable blockchain can verify a block with a high probability. Finally, Trie-Hashimoto discourages big mining pools by increasing the network overhead among the miners. Our experiment on the Geth client with 500K blocks and 100M accounts shows that Trie-Hashimoto improves the transaction execution time tangibly, reducing the full synchronization time by half. It also shows that Trie-Hashimoto has enough memory-hardness as Ethash. Lastly, a Trie-Hashimoto mining pool should exchange messages highly frequently, proportional to the total number of miners.
Fernando Román-García, Juan Hernández‐Serrano, Óscar Esparza
This article introduces the Non-Repudiable Data Exchange (NoRDEx) protocol, designed to ensure non-repudiation in data exchanges. Unlike traditional non-repudiation and fair exchange protocols, NoRDEx can be considered decentralized as it eliminates the need for a centralized Trusted Third Party (TTP) by using a Distributed Ledger Technology (DLT) to store cryptographic proofs without revealing the exchanged message. NoRDEx is an optimistic non-repudiation protocol, as it only uses the DLT in case of a dispute. The protocol has been implemented and tested in real-world environments, with performance assessments covering cost, overhead, and execution time. A formal security analysis using the Syverson Van Oorschot (SVO) logical model demonstrates NoRDEx’s ability to resolve disputes securely.
This document serves as a reference for the architectural design and implementation of a secure decentralized data sharing framework. The framework leverages Distributed Ledger Technology (DLT) to ensure data integrity and immutability, while incorporating multi-party computation, fully homomorphic encryption and Trusted Execution Environments for privacy preservation. The document also explores the GAIA-X framework to further strengthen data security within the decentralized environment.
Public blockchains, such as Ethereum, rely on decentralized networks of peer-to-peer nodes known as validators or miners to verify all transactions and create new valid blocks. These validators can prioritize transactions, primarily based on high gas fees, allowing miners to maximize their block rewards, a concept referred to as maximal extractable value (MEV). However, MEV is vulnerable to front-running, back-running, and sandwich attacks (FBSAs), and is exploited by malicious nodes and bots to manipulate users’ valuable transactions. These malicious activities adversely impact the Blockchain’s scalability, transparency, and security. Flashbots, as one of the solutions, introduces centralization since all nodes have to forward all blocks to the central node. To address these issues, we have designed a new Blockchain transaction ordering protocol called Quantum Random Transaction Ordering Protocol (Q-RTOP). The proposed protocol operates on top of the existing Blockchain transaction ordering mechanism. However, instead of allowing validators to select transactions based on high gas fees, decentralized nodes running Q-RTOP securely randomize all transactions and then forward them to the validators, which proceed with the block validation without any change. Our protocol primarily focuses on randomizing transactions before being processed by the validators by utilizing a quantum random generator as a secure source of randomness. The final results demonstrated that Q-RTOP effectively secured user transactions and randomized 8192 transactions within 25 milliseconds.
Exponential growth of the space industry avails unprecedented opportunities to establish a marketplace of satellite infrastructure services. However, security and resource constraints pose critical challenges to implementing the exchange of services such as storage, compute or even arm-based manipulation. We propose a fully distributed architecture that will facilitate resilient, trustless interactions to enable space infrastructure as a service and applications such as in-space servicing. The distributed architecture engages Distributed Ledger Technology (DLT) such as blockchains and directed acyclic graphs to designate and enforce security policy via smart contracts between multiple parties across payloads owned or operated by different service providers on the same satellite bus or across a constellation. This work presents a zero-trust space infrastructure as a service architecture and examines how the architecture addresses critical challenges such as consensus and cyber resilience to facilitate a space services marketplace.
The primary trend in the development of modern information technologies is the migration of computations to the cloud, making distributed computing the dominant strategy for information processing. In particular, this poses the challenge of reliable distributed data storage. A well-known approach to solving the problem of distributed data storage is blockchain or, more generally, distributed ledger technology. A key challenge of this technology is creating an effective mechanism for the global numbering of registry records. The complexity of solving this problem results from the fundamental limitations of distributed computing — the inability to accurately synchronize distributed computing processes and the limitations resulting from the CAP theorem for distributed data stores. The authors attempt to circumvent the mentioned limitations based on the hypothesis that such limitations can be overcome by considering both the network topology and narrowing the class of distributed systems to distributed registers. The work is based on methods of modeling distributed computing, particularly the model of space-time diagrams proposed by L. Lamport. This model allows us to introduce such a tool as logical clocks, including Lamport's logical clock algorithm. Unfortunately, Lamport's logical clock algorithm allows assigning a common timestamp to different events if they are concurrent. The paper proposes an algorithm that is a composition of Lamport's clock algorithm and the wave algorithm, which is not only a logical clock but also assigns different timestamps to different events. Thus, this algorithm provides a mechanism for the global numbering of entries of distributed ledger replicas. A problematic issue remains gaps in the series of ledger entry numbers. Thus, the paper proposes an effective mechanism for the global numbering of records of a distributed register and identifies a shortcoming of this mechanism. Further study is to identify specific conditions in terms of network topology that would ensure the absence of the mentioned shortcoming.
Smart contracts are programs stored on a blockchain ledger, thus being immutable after deployment, which makes assessment of their correctness before deployment vital. Extended finite state machines (EFSM) offer a structured framework for modeling complex systems, thus providing a systematic approach to scrutinize smart contract functionalities. This paper describes a methodology to automatically convert from the abstract syntax tree of a smart contract to an EFSM model. A smart contract implementing a casino is the specific use case, and verification of the EFSM model reveals it to be blocking. This blocking represents that a malicious player can lock the funds of the casino so that they can never be retrieved.