Blockchain Papers

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846 papersLast indexed Aug 31, 2026
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Nov 27, 2023·arXiv (Cornell University)
2 cites
VeryFL: A Verify Federated Learning Framework Embedded with Blockchain

Yihao Li, Yanyi Lai, Chuan Chen, Zibin Zheng

Blockchain-empowered federated learning (FL) has provoked extensive research recently. Various blockchain-based federated learning algorithm, architecture and mechanism have been designed to solve issues like single point failure and data falsification brought by centralized FL paradigm. Moreover, it is easier to allocate incentives to nodes with the help of the blockchain. Various centralized federated learning frameworks like FedML, have emerged in the community to help boost the research on FL. However, decentralized blockchain-based federated learning framework is still missing, which cause inconvenience for researcher to reproduce or verify the algorithm performance based on blockchain. Inspired by the above issues, we have designed and developed a blockchain-based federated learning framework by embedding Ethereum network. This report will present the overall structure of this framework, which proposes a code practice paradigm for the combination of FL with blockchain and, at the same time, compatible with normal FL training task. In addition to implement some blockchain federated learning algorithms on smart contract to help execute a FL training, we also propose a model ownership authentication architecture based on blockchain and model watermarking to protect the intellectual property rights of models. These mechanism on blockchain shows an underlying support of blockchain for federated learning to provide a verifiable training, aggregation and incentive distribution procedure and thus we named this framework VeryFL (A Verify Federated Learninig Framework Embedded with Blockchain). The source code is avaliable on https://github.com/GTMLLab/VeryFL.

Open access
2 source records
cs.LG
cs.CR
Privacy-Preserving Technologies in Data
Original source
Nov 26, 2023·Proceedings of the VLDB Endowment
16 cites
Secure and Verifiable Data Collaboration with Low-Cost Zero-Knowledge Proofs

Yizheng Zhu, Yuncheng Wu, Zhaojing Luo, Beng Chin Ooi · 5 authors

Federated Learning (FL) emerges as a viable solution to facilitate data collaboration, enabling multiple clients to collaboratively train a machine learning (ML) model under the supervision of a central server while ensuring the confidentiality of their raw data. However, existing studies have unveiled two main risks: (i) the potential for the server to infer sensitive information from the client's uploaded updates (i.e., model gradients), compromising client input privacy, and (ii) the risk of malicious clients uploading malformed updates to poison the FL model, compromising input integrity. Recent works utilize secure aggregation with zero-knowledge proofs (ZKP) to guarantee input privacy and integrity in FL. Nevertheless, they suffer from extremely low efficiency and, thus, are impractical for real deployment. In this paper, we propose a novel and highly efficient approach RiseFL for secure and verifiable data collaboration, ensuring input privacy and integrity simultaneously. Firstly, we devise a probabilistic integrity check method that transforms strict checks into a hypothesis test problem, offering great optimization opportunities. Secondly, we introduce a hybrid commitment scheme to satisfy Byzantine robustness with improved performance. Thirdly, we present an optimized ZKP generation and verification technique that significantly reduces the ZKP cost based on probabilistic integrity checks. Furthermore, we theoretically prove the security guarantee of RiseFL and provide a cost analysis compared to state-of-the-art baselines. Extensive experiments on synthetic and real-world datasets suggest that our approach is effective and highly efficient in both client computation and communication. For instance, RiseFL is up to 28x, 53x, and 164x faster than baselines ACORN, RoFL, and EIFFeL for the client computation.

Open access
4 source records
Cryptography and Data Security
Privacy-Preserving Technologies in Data
Cloud Data Security Solutions
Original source
Nov 25, 2023·arXiv (Cornell University)
0 cites
New Online Communities: Graph Deep Learning on Anonymous Voting Networks to Identify Sybils in Polycentric Governance

Quinn DuPont

This research examines the polycentric governance of digital assets in blockchain-based Decentralized Autonomous Organizations (DAOs). It offers a theoretical framework and addresses a critical challenge facing decentralized governance by developing a method to identify Sybils, or spurious identities. Sybils pose significant organizational sustainability threats to DAOs and other, commons-based online communities, and threat models are identified. The experimental method uses an autoencoder architecture and graph deep learning techniques to identify Sybil activity in a DAO governance dataset (snapshot.org). Specifically, a Graph Convolutional Neural Network (GCNN) learned voting behaviours and a fast vector clustering algorithm used high-dimensional embeddings to identify similar nodes in a graph. The results reveal that deep learning can effectively identify Sybils, reducing the voting graph by 2-5%. This research underscores the importance of Sybil resistance in DAOs, identifies challenges and opportunities for forensics and analysis of anonymous networks, and offers a novel perspective on decentralized governance, informing future policy, regulation, and governance practices.

Open access
2 source records
Blockchain Technology Applications and Security
FinTech, Crowdfunding, Digital Finance
Sharing Economy and Platforms
Original source
Nov 23, 2023·arXiv
0 cites
A Blockchain Solution for Collaborative Machine Learning over IoT

Carlos Beis-Penedo, Francisco Troncoso-Pastoriza, Rebeca P. Díaz-Redondo, Ana Fernández-Vilas · 6 authors

The rapid growth of Internet of Things (IoT) devices and applications has led to an increased demand for advanced analytics and machine learning techniques capable of handling the challenges associated with data privacy, security, and scalability. Federated learning (FL) and blockchain technologies have emerged as promising approaches to address these challenges by enabling decentralized, secure, and privacy-preserving model training on distributed data sources. In this paper, we present a novel IoT solution that combines the incremental learning vector quantization algorithm (XuILVQ) with Ethereum blockchain technology to facilitate secure and efficient data sharing, model training, and prototype storage in a distributed environment. Our proposed architecture addresses the shortcomings of existing blockchain-based FL solutions by reducing computational and communication overheads while maintaining data privacy and security. We assess the performance of our system through a series of experiments, showcasing its potential to enhance the accuracy and efficiency of machine learning tasks in IoT settings.

Open access
cs.LG
cs.CR
cs.NI
Original source
Nov 23, 2023·International Journal of Forecasting
18 cites
Deep learning and NLP in cryptocurrency forecasting: Integrating financial, blockchain, and social media data

Vincent Gurgul, Stefan Lessmann, Wolfgang Karl Härdle

We introduce novel approaches to cryptocurrency price forecasting, leveraging Machine Learning (ML) and Natural Language Processing (NLP) techniques, with a focus on Bitcoin and Ethereum. By analysing news and social media content, primarily from Twitter and Reddit, we assess the impact of public sentiment on cryptocurrency markets. A distinctive feature of our methodology is the application of the BART MNLI zero-shot classification model to detect bullish and bearish trends, significantly advancing beyond traditional sentiment analysis. Additionally, we systematically compare a range of pre-trained and fine-tuned deep learning NLP models against conventional dictionary-based sentiment analysis methods. Another key contribution of our work is the adoption of local extrema alongside daily price movements as predictive targets, reducing trading frequency and portfolio volatility. Our findings demonstrate that integrating textual data into cryptocurrency price forecasting not only improves forecasting accuracy but also consistently enhances the profitability and Sharpe ratio across various validation scenarios, particularly when applying deep learning NLP techniques. The entire codebase of our experiments is available via an online repository: https://anonymous.4open.science/r/crypto-forecasting-public . • NLP data from social media improve the accuracy of cryptocurrency forecasting models. • As a target variable, local extrema are a valid alternative to daily price changes. • Deep learning language models substantially outperform dictionary-based methodologies. • Both pre-trained and fine-tuned language models effectively quantify market sentiment.

Open access
3 source records
Stock Market Forecasting Methods
Blockchain Technology Applications and Security
Complex Systems and Time Series Analysis
Original source
Nov 21, 2023·arXiv
0 cites
FBChain: A Blockchain-based Federated Learning Model with Efficiency and Secure Communication

Yang Li, Chunhe Xia, Tianbo Wang

Privacy and security in the parameter transmission process of federated learning are currently among the most prominent concerns. However, there are two thorny problems caused by unprotected communication methods: "parameter-leakage" and "inefficient-communication". This article proposes Blockchain-based Federated Learning (FBChain) model for federated learning parameter communication to overcome the above two problems. First, we utilize the immutability of blockchain to store the global model and hash value of local model parameters in case of tampering during the communication process, protect data privacy by encrypting parameters, and verify data consistency by comparing the hash values of local parameters, thus addressing the "parameter-leakage" problem. Second, the Proof of Weighted Link Speed (PoWLS) consensus algorithm comprehensively selects nodes with the higher weighted link speed to aggregate global model and package blocks, thereby solving the "inefficient-communication" problem. Experimental results demonstrate the effectiveness of our proposed FBChain model and its ability to improve model communication efficiency in federated learning.

Open access
cs.CR
cs.LG
Original source
Nov 21, 2023·arXiv (Cornell University)
3 cites
Heuristics for Detecting CoinJoin Transactions on the Bitcoin Blockchain

Hugo Schnoering, Michalis Vazirgiannis

This research delves into the intricacies of Bitcoin, a decentralized peer-to-peer network, and its associated blockchain, which records all transactions since its inception. While this ensures integrity and transparency, the transparent nature of Bitcoin potentially compromises users' privacy rights. To address this concern, users have adopted CoinJoin, a method that amalgamates multiple transaction intents into a single, larger transaction to bolster transactional privacy. This process complicates individual transaction tracing and disrupts many established blockchain analysis heuristics. Despite its significance, limited research has been conducted on identifying CoinJoin transactions. Particularly noteworthy are varied CoinJoin implementations such as JoinMarket, Wasabi, and Whirlpool, each presenting distinct challenges due to their unique transaction structures. This study delves deeply into the open-source implementations of these protocols, aiming to develop refined heuristics for identifying their transactions on the blockchain. Our exhaustive analysis covers transactions up to block 760,000, offering a comprehensive insight into CoinJoin transactions and their implications for Bitcoin blockchain analysis.

Open access
2 source records
Blockchain Technology Applications and Security
Internet Traffic Analysis and Secure E-voting
cs.CR
Original source
Nov 17, 2023·arXiv
0 cites
Exploring Machine Learning Models for Federated Learning: A Review of Approaches, Performance, and Limitations

Elaheh Jafarigol, Theodore Trafalis, Talayeh Razzaghi, Mona Zamankhani

In the growing world of artificial intelligence, federated learning is a distributed learning framework enhanced to preserve the privacy of individuals' data. Federated learning lays the groundwork for collaborative research in areas where the data is sensitive. Federated learning has several implications for real-world problems. In times of crisis, when real-time decision-making is critical, federated learning allows multiple entities to work collectively without sharing sensitive data. This distributed approach enables us to leverage information from multiple sources and gain more diverse insights. This paper is a systematic review of the literature on privacy-preserving machine learning in the last few years based on the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) guidelines. Specifically, we have presented an extensive review of supervised/unsupervised machine learning algorithms, ensemble methods, meta-heuristic approaches, blockchain technology, and reinforcement learning used in the framework of federated learning, in addition to an overview of federated learning applications. This paper reviews the literature on the components of federated learning and its applications in the last few years. The main purpose of this work is to provide researchers and practitioners with a comprehensive overview of federated learning from the machine learning point of view. A discussion of some open problems and future research directions in federated learning is also provided.

Open access
cs.LG
cs.AI
Original source
Nov 17, 2023·arXiv (Cornell University)
8 cites
Decentralized Energy Marketplace via NFTs and AI-based Agents

Rasoul Nikbakht, Farhana Javed, Farhad Rezazadeh, Nikolaos Bartzoudis · 5 authors

The paper introduces an advanced Decentralized Energy Marketplace (DEM) integrating blockchain technology and artificial intelligence to manage energy exchanges among smart homes with energy storage systems. The proposed framework uses Non-Fungible Tokens (NFTs) to represent unique energy profiles in a transparent and secure trading environment. Leveraging Federated Deep Reinforcement Learning (FDRL), the system promotes collaborative and adaptive energy management strategies, maintaining user privacy. A notable innovation is the use of smart contracts, ensuring high efficiency and integrity in energy transactions. Extensive evaluations demonstrate the system's scalability and the effectiveness of the FDRL method in optimizing energy distribution. This research significantly contributes to developing sophisticated decentralized smart grid infrastructures. Our approach broadens potential blockchain and AI applications in sustainable energy systems and addresses incentive alignment and transparency challenges in traditional energy trading mechanisms. The implementation of this paper is publicly accessible at \url{https://github.com/RasoulNik/DEM}.

Open access
3 source records
Smart Grid Energy Management
Reinforcement Learning in Robotics
Smart Grid Security and Resilience
Original source
Nov 14, 2023·arXiv
0 cites
A Quality-of-Service Compliance System using Federated Learning and Optimistic Rollups

Joao Paulo de Brito Goncalves, Guilherme Emerick Sathler, Rodolfo da Silva Villaca

Edge computing brings a new paradigm in which the sharing of computing, storage, and bandwidth resources as close as possible to the mobile devices or sensors generating a large amount of data. A parallel trend is the rise of phones and tablets as primary computing devices for many people. The powerful sensors present on these devices combined with the fact that they are mobile, mean they have access to data of an unprecedentedly diverse and private nature. Models learned on such data hold the promise of greatly improving usability by powering more intelligent applications, but the sensitive nature of the data means there are risks and responsibilities to storing it in a centralized location. To address the data privacy required for some data in these devices we propose the use of Federated Learning (FL) so that specific data about services performed by clients do not leave the source machines. Instead of sharing data, users collaboratively train a model by only sending weight updates to a server. However, the naive use of FL in those scenarios exposes it to a risk of corruption, whether intentional or not, during the training phase. To improve the security of the FL structure, we propose a decentralized Blockchain-based FL in an edge computing scenario. We also apply blockchain to create a reward mechanism in FL to enable incentive strategy for trainers.

Open access
cs.CR
cs.LG
Original source
Nov 2, 2023·arXiv (Cornell University)
2 cites
Analysis of Information Propagation in Ethereum Network Using Combined Graph Attention Network and Reinforcement Learning to Optimize Network Efficiency and Scalability

Stefan Kambiz Behfar, Richard Mortier, Jon Crowcroft

Blockchain technology has revolutionized the way information is propagated in decentralized networks. Ethereum plays a pivotal role in facilitating smart contracts and decentralized applications. Understanding information propagation dynamics in Ethereum is crucial for ensuring network efficiency, security, and scalability. In this study, we propose an innovative approach that utilizes Graph Convolutional Networks (GCNs) to analyze the information propagation patterns in the Ethereum network. The first phase of our research involves data collection from the Ethereum blockchain, consisting of blocks, transactions, and node degrees. We construct a transaction graph representation using adjacency matrices to capture the node embeddings; while our major contribution is to develop a combined Graph Attention Network (GAT) and Reinforcement Learning (RL) model to optimize the network efficiency and scalability. It learns the best actions to take in various network states, ultimately leading to improved network efficiency, throughput, and optimize gas limits for block processing. In the experimental evaluation, we analyze the performance of our model on a large-scale Ethereum dataset. We investigate effectively aggregating information from neighboring nodes capturing graph structure and updating node embeddings using GCN with the objective of transaction pattern prediction, accounting for varying network loads and number of blocks. Not only we design a gas limit optimization model and provide the algorithm, but also to address scalability, we demonstrate the use and implementation of sparse matrices in GraphConv, GraphSAGE, and GAT. The results indicate that our designed GAT-RL model achieves superior results compared to other GCN models in terms of performance. It effectively propagates information across the network, optimizing gas limits for block processing and improving network efficiency.

Open access
3 source records
Advanced Graph Neural Networks
Complex Network Analysis Techniques
Blockchain Technology Applications and Security
Original source
Oct 30, 2023·2023 IEEE 14th Annual Ubiquitous Computing, Electronics & Mobile Communication Conference (UEMCON)
0 cites
Enhancing Scalability and Reliability in Semi-Decentralized Federated Learning With Blockchain: Trust Penalization and Asynchronous Functionality

Ajay Kumar Shrestha, Faijan Ahamad Khan, Mohammed Afaan Shaikh, Amir Jaberzadeh · 5 authors

The paper presents an innovative approach to address the challenges of scalability and reliability in Distributed Federated Learning by leveraging the integration of blockchain technology. The paper focuses on enhancing the trustworthiness of participating nodes through a trust penalization mechanism while also enabling asynchronous functionality for efficient and robust model updates. By combining Semi-Decentralized Federated Learning with Blockchain (SDFL-B), the proposed system aims to create a fair, secure and transparent environment for collaborative machine learning without compromising data privacy. The research presents a comprehensive system architecture, methodologies, experimental results, and discussions that demonstrate the advantages of this novel approach in fostering scalable and reliable SDFL-B systems.

Open access
cs.LG
Original source
Oct 27, 2023·arXiv
0 cites
From Generative AI to Generative Internet of Things: Fundamentals, Framework, and Outlooks

Jinbo Wen, Jiangtian Nie, Jiawen Kang, Dusit Niyato · 7 authors

Generative Artificial Intelligence (GAI) possesses the capabilities of generating realistic data and facilitating advanced decision-making. By integrating GAI into modern Internet of Things (IoT), Generative Internet of Things (GIoT) is emerging and holds immense potential to revolutionize various aspects of society, enabling more efficient and intelligent IoT applications, such as smart surveillance and voice assistants. In this article, we present the concept of GIoT and conduct an exploration of its potential prospects. Specifically, we first overview four GAI techniques and investigate promising GIoT applications. Then, we elaborate on the main challenges in enabling GIoT and propose a general GAI-based secure incentive mechanism framework to address them, in which we adopt Generative Diffusion Models (GDMs) for incentive mechanism designs and apply blockchain technologies for secure GIoT management. Moreover, we conduct a case study on modern Internet of Vehicle traffic monitoring, which utilizes GDMs to generate effective contracts for incentivizing users to contribute sensing data with high quality. Finally, we suggest several open directions worth investigating for the future popularity of GIoT.

Open access
cs.LG
cs.GT
cs.NI
Original source
Oct 23, 2023·IEEE Communications Surveys & Tutorials
32 cites
Zero-Knowledge Proof-Based Verifiable Decentralized Machine Learning in Communication Network: A Comprehensive Survey

Zhibo Xing, Zijian Zhang, Ziang Zhang, Zhen Li · 11 authors

Over recent decades, machine learning has significantly advanced network communication, enabling improved decision-making, user behavior analysis, and fault detection. Simultaneously, the growth of communication networks has facilitated the efficient collection of large-scale training data. Traditional centralized machine learning, however, requires collecting data from users, raising significant concerns about privacy and security. Decentralized approaches, where participants exchange computation results instead of raw private data, mitigate these risks but introduce challenges related to trust and verifiability. A critical issue arises: How can one ensure the integrity and validity of computation results shared by other participants? Existing survey articles predominantly address security and privacy concerns in decentralized machine learning, whereas this survey uniquely highlights the emerging issue of verifiability. Recognizing the critical role of zero-knowledge proofs in ensuring verifiability, we present a comprehensive review of Zero-Knowledge Proof-based Verifiable Machine Learning (ZKP-VML). To clarify the research problem, we present a definition of ZKP-VML consisting of four algorithms and several key security properties. In addition, we provide an overview of the current research landscape by systematically organizing the research timeline and categorizing existing schemes based on their security properties. Furthermore, through an in-depth analysis of each existing scheme, we summarize their technical contributions and optimization strategies, aiming to uncover common design principles underlying ZKP-VML schemes. Building on the reviews and analysis presented, we identify current research challenges and suggest future research directions. To the best of our knowledge, this is the most comprehensive survey to date on verifiable decentralized machine learning and ZKP-VML.

Open access
4 source records
Neural Networks and Applications
Adversarial Robustness in Machine Learning
cs.LG
Original source
Oct 20, 2023·arXiv
0 cites
BRFL: A Blockchain-based Byzantine-Robust Federated Learning Model

Yang Li, Chunhe Xia, Chang Li, Tianbo Wang

With the increasing importance of machine learning, the privacy and security of training data have become critical. Federated learning, which stores data in distributed nodes and shares only model parameters, has gained significant attention for addressing this concern. However, a challenge arises in federated learning due to the Byzantine Attack Problem, where malicious local models can compromise the global model's performance during aggregation. This article proposes the Blockchain-based Byzantine-Robust Federated Learning (BRLF) model that combines federated learning with blockchain technology. This integration enables traceability of malicious models and provides incentives for locally trained clients. Our approach involves selecting the aggregation node based on Pearson's correlation coefficient, and we perform spectral clustering and calculate the average gradient within each cluster, validating its accuracy using local dataset of the aggregation nodes. Experimental results on public datasets demonstrate the superior byzantine robustness of our secure aggregation algorithm compared to other baseline byzantine robust aggregation methods, and proved our proposed model effectiveness in addressing the resource consumption problem.

Open access
cs.LG
Original source
Oct 15, 2023·arXiv
0 cites
SGA: A Graph Augmentation Method for Signed Graph Neural Networks

Zeyu Zhang, Shuyan Wan, Sijie Wang, Xianda Zheng · 8 authors

Signed Graph Neural Networks (SGNNs) are vital for analyzing complex patterns in real-world signed graphs containing positive and negative links. However, three key challenges hinder current SGNN-based signed graph representation learning: sparsity in signed graphs leaves latent structures undiscovered, unbalanced triangles pose representation difficulties for SGNN models, and real-world signed graph datasets often lack supplementary information like node labels and features. These constraints limit the potential of SGNN-based representation learning. We address these issues with data augmentation techniques. Despite many graph data augmentation methods existing for unsigned graphs, none are tailored for signed graphs. Our paper introduces the novel Signed Graph Augmentation framework (SGA), comprising three main components. First, we employ the SGNN model to encode the signed graph, extracting latent structural information for candidate augmentation structures. Second, we evaluate these candidate samples (edges) and select the most beneficial ones for modifying the original training set. Third, we propose a novel augmentation perspective that assigns varying training difficulty to training samples, enabling the design of a new training strategy. Extensive experiments on six real-world datasets (Bitcoin-alpha, Bitcoin-otc, Epinions, Slashdot, Wiki-elec, and Wiki-RfA) demonstrate that SGA significantly improves performance across multiple benchmarks. Our method outperforms baselines by up to 22.2% in AUC for SGCN on Wiki-RfA, 33.3% in F1-binary, 48.8% in F1-micro, and 36.3% in F1-macro for GAT on Bitcoin-alpha in link sign prediction.

Open access
cs.LG
cs.SI
Original source
Oct 14, 2023·arXiv
0 cites
A Blockchain-empowered Multi-Aggregator Federated Learning Architecture in Edge Computing with Deep Reinforcement Learning Optimization

Xiao Li, Weili Wu

Federated learning (FL) is emerging as a sought-after distributed machine learning architecture, offering the advantage of model training without direct exposure of raw data. With advancements in network infrastructure, FL has been seamlessly integrated into edge computing. However, the limited resources on edge devices introduce security vulnerabilities to FL in the context. While blockchain technology promises to bolster security, practical deployment on resource-constrained edge devices remains a challenge. Moreover, the exploration of FL with multiple aggregators in edge computing is still new in the literature. Addressing these gaps, we introduce the Blockchain-empowered Heterogeneous Multi-Aggregator Federated Learning Architecture (BMA-FL). We design a novel light-weight Byzantine consensus mechanism, namely PBCM, to enable secure and fast model aggregation and synchronization in BMA-FL. We also dive into the heterogeneity problem in BMA-FL that the aggregators are associated with varied number of connected trainers with Non-IID data distributions and diverse training speed. We proposed a multi-agent deep reinforcement learning algorithm to help aggregators decide the best training strategies. The experiments on real-word datasets demonstrate the efficiency of BMA-FL to achieve better models faster than baselines, showing the efficacy of PBCM and proposed deep reinforcement learning algorithm.

Open access
cs.DC
cs.CR
cs.LG
Original source
Oct 14, 2023·arXiv (Cornell University)
3 cites
A Framework for Empowering Reinforcement Learning Agents with Causal Analysis: Enhancing Automated Cryptocurrency Trading

Rasoul Amirzadeh, Dhananjay Thiruvady, Asef Nazari, Mong Shan Ee

Despite advances in artificial intelligence-enhanced trading methods, developing a profitable automated trading system remains challenging in the rapidly evolving cryptocurrency market. This research focuses on developing a reinforcement learning (RL) framework to tackle the complexities of trading five prominent altcoins: Binance Coin, Ethereum, Litecoin, Ripple, and Tether. To this end, we present the CausalReinforceNet~(CRN) framework, which integrates both Bayesian and dynamic Bayesian network techniques to empower the RL agent in trade decision-making. We develop two agents using the framework based on distinct RL algorithms to analyse performance compared to the Buy-and-Hold benchmark strategy and a baseline RL model. The results indicate that our framework surpasses both models in profitability, highlighting CRN's consistent superiority, although the level of effectiveness varies across different cryptocurrencies.

Open access
2 source records
cs.AI
cs.LG
Blockchain Technology Applications and Security
Original source
Oct 13, 2023·arXiv (Cornell University)
2 cites
ZeroSwap: Data-driven Optimal Market Making in DeFi

Viraj Nadkarni, Jiachen Hu, Ranvir Rana, Jin, Chi · 6 authors

Automated Market Makers (AMMs) are major centers of matching liquidity supply and demand in Decentralized Finance. Their functioning relies primarily on the presence of liquidity providers (LPs) incentivized to invest their assets into a liquidity pool. However, the prices at which a pooled asset is traded is often more stale than the prices on centralized and more liquid exchanges. This leads to the LPs suffering losses to arbitrage. This problem is addressed by adapting market prices to trader behavior, captured via the classical market microstructure model of Glosten and Milgrom. In this paper, we propose the first optimal Bayesian and the first model-free data-driven algorithm to optimally track the external price of the asset. The notion of optimality that we use enforces a zero-profit condition on the prices of the market maker, hence the name ZeroSwap. This ensures that the market maker balances losses to informed traders with profits from noise traders. The key property of our approach is the ability to estimate the external market price without the need for price oracles or loss oracles. Our theoretical guarantees on the performance of both these algorithms, ensuring the stability and convergence of their price recommendations, are of independent interest in the theory of reinforcement learning. We empirically demonstrate the robustness of our algorithms to changing market conditions.

Open access
2 source records
cs.LG
cs.GT
Financial Markets and Investment Strategies
Original source
Oct 10, 2023·arXiv
0 cites
BC4LLM: Trusted Artificial Intelligence When Blockchain Meets Large Language Models

Haoxiang Luo, Jian Luo, Athanasios V. Vasilakos

In recent years, artificial intelligence (AI) and machine learning (ML) are reshaping society's production methods and productivity, and also changing the paradigm of scientific research. Among them, the AI language model represented by ChatGPT has made great progress. Such large language models (LLMs) serve people in the form of AI-generated content (AIGC) and are widely used in consulting, healthcare, and education. However, it is difficult to guarantee the authenticity and reliability of AIGC learning data. In addition, there are also hidden dangers of privacy disclosure in distributed AI training. Moreover, the content generated by LLMs is difficult to identify and trace, and it is difficult to cross-platform mutual recognition. The above information security issues in the coming era of AI powered by LLMs will be infinitely amplified and affect everyone's life. Therefore, we consider empowering LLMs using blockchain technology with superior security features to propose a vision for trusted AI. This paper mainly introduces the motivation and technical route of blockchain for LLM (BC4LLM), including reliable learning corpus, secure training process, and identifiable generated content. Meanwhile, this paper also reviews the potential applications and future challenges, especially in the frontier communication networks field, including network resource allocation, dynamic spectrum sharing, and semantic communication. Based on the above work combined and the prospect of blockchain and LLMs, it is expected to help the early realization of trusted AI and provide guidance for the academic community.

Open access
cs.NI
cs.AI
cs.LG
Original source
Oct 4, 2023·IEEE Transactions on Big Data
38 cites
zkFL: Zero-Knowledge Proof-Based Gradient Aggregation for Federated Learning

Zhipeng Wang, Nanqing Dong, Jiahao Sun, William J. Knottenbelt · 5 authors

Federated learning (FL) is a machine learning paradigm, which enables multiple and decentralized clients to collaboratively train a model under the orchestration of a central aggregator. FL can be a scalable machine learning solution in big data scenarios. Traditional FL relies on the trust assumption of the central aggregator, which forms cohorts of clients honestly. However, a malicious aggregator, in reality, could abandon and replace the client's training models, or insert fake clients, to manipulate the final training results. In this work, we introduce zkFL, which leverages zero-knowledge proofs to tackle the issue of a malicious aggregator during the training model aggregation process. To guarantee the correct aggregation results, the aggregator provides a proof per round, demonstrating to the clients that the aggregator executes the intended behavior faithfully. To further reduce the verification cost of clients, we use blockchain to handle the proof in a zero-knowledge way, where miners (i.e., the participants validating and maintaining the blockchain data) can verify the proof without knowing the clients' local and aggregated models. The theoretical analysis and empirical results show that zkFL achieves better security and privacy than traditional FL, without modifying the underlying FL network structure or heavily compromising the training speed.

Open access
3 source records
Privacy-Preserving Technologies in Data
Cryptography and Data Security
Stochastic Gradient Optimization Techniques
Original source
Oct 3, 2023·arXiv (Cornell University)
0 cites
What Determines the Price of NFTs?

Vivian Ziemke, Benjamin Estermann, Roger Wattenhofer, Ye Wang

In the evolving landscape of digital art, Non-Fungible Tokens (NFTs) have emerged as a groundbreaking platform, bridging the realms of art and technology. NFTs serve as the foundational framework that has revolutionized the market for digital art, enabling artists to showcase and monetize their creations in unprecedented ways. NFTs combine metadata stored on the blockchain with off-chain data, such as images, to create a novel form of digital ownership. It is not fully understood how these factors come together to determine NFT prices. In this study, we analyze both on-chain and off-chain data of NFT collections trading on OpenSea to understand what influences NFT pricing. Our results show that while text and image data of the NFTs can be used to explain price variations within collections, the extracted features do not generalize to new, unseen collections. Furthermore, we find that an NFT collection's trading volume often relates to its online presence, like social media followers and website traffic.

Open access
2 source records
cs.CE
cs.LG
Art History and Market Analysis
Original source
Oct 2, 2023·arXiv
0 cites
Combining Deep Learning and GARCH Models for Financial Volatility and Risk Forecasting

Jakub Michańków, Łukasz Kwiatkowski, Janusz Morajda

In this paper, we develop a hybrid approach to forecasting the volatility and risk of financial instruments by combining common econometric GARCH time series models with deep learning neural networks. For the latter, we employ Gated Recurrent Unit (GRU) networks, whereas four different specifications are used as the GARCH component: standard GARCH, EGARCH, GJR-GARCH and APARCH. Models are tested using daily logarithmic returns on the S&P 500 index as well as gold price Bitcoin prices, with the three assets representing quite distinct volatility dynamics. As the main volatility estimator, also underlying the target function of our hybrid models, we use the price-range-based Garman-Klass estimator, modified to incorporate the opening and closing prices. Volatility forecasts resulting from the hybrid models are employed to evaluate the assets' risk using the Value-at-Risk (VaR) and Expected Shortfall (ES) at two different tolerance levels of 5% and 1%. Gains from combining the GARCH and GRU approaches are discussed in the contexts of both the volatility and risk forecasts. In general, it can be concluded that the hybrid solutions produce more accurate point volatility forecasts, although it does not necessarily translate into superior VaR and ES forecasts.

Open access
q-fin.RM
cs.AI
cs.LG
Original source
Oct 2, 2023·arXiv
0 cites
A Novel IoT Trust Model Leveraging Fully Distributed Behavioral Fingerprinting and Secure Delegation

Marco Arazzi, Serena Nicolazzo, Antonino Nocera

With the number of connected smart devices expected to constantly grow in the next years, Internet of Things (IoT) solutions are experimenting a booming demand to make data collection and processing easier. The ability of IoT appliances to provide pervasive and better support to everyday tasks, in most cases transparently to humans, is also achieved through the high degree of autonomy of such devices. However, the higher the number of new capabilities and services provided in an autonomous way, the wider the attack surface that exposes users to data hacking and lost. In this scenario, many critical challenges arise also because IoT devices have heterogeneous computational capabilities (i.e., in the same network there might be simple sensors/actuators as well as more complex and smart nodes). In this paper, we try to provide a contribution in this setting, tackling the non-trivial issues of equipping smart things with a strategy to evaluate, also through their neighbors, the trustworthiness of an object in the network before interacting with it. To do so, we design a novel and fully distributed trust model exploiting devices' behavioral fingerprints, a distributed consensus mechanism and the Blockchain technology. Beyond the detailed description of our framework, we also illustrate the security model associated with it and the tests carried out to evaluate its correctness and performance.

Open access
cs.CR
cs.LG
Original source