Hans Walter Behrens, Nicolò Vallarano, Claudio J. Tessone
The proceedings of ChainScience 2023 epitomize the integration of various scientific disciplines with the dynamic world of blockchain and AI. This collection, encapsulating both full and short papers, as well as posters, delves into areas such as cryptoeconomics, machine learning, and analysis of blockchain networks, under the guiding principle of this year's conference: 'Applying insights and methods from the physical, mathematical, behavioral, and computational sciences to blockchain and the future of AI'. This diverse compilation offers a critical examination of theoretical constructs and innovative practical applications to empower the future of the blockchain industry.
Orestis Alpos, Ignacio Amores-Sesar, Christian Cachin, Michelle Yeo
Traditional blockchains grant the miner of a block full control not only over which transactions but also their order. This constitutes a major flaw discovered with the introduction of decentralized finance and allows miners to perform MEV attacks. In this paper, we address the issue of sandwich attacks by providing a construction that takes as input a blockchain protocol and outputs a new blockchain protocol with the same security but in which sandwich attacks are not profitable. Furthermore, our protocol is fully decentralized with no trusted third parties or heavy cryptography primitives and carries a linear increase in latency and minimum computation overhead.
Payment channel networks are an approach to improve the scalability of blockchain-based cryptocurrencies. Because payment channel networks are used for transfer of financial value, their security in the presence of adversarial participants should be verified formally. We formalize the protocol of the Lightning Network, a payment channel network built for Bitcoin, and show that the protocol fulfills the expected security properties. As the state space of a specification consisting of multiple participants is too large for model checking, we formalize intermediate specifications and use a chain of refinements to validate the security properties where each refinement is justified either by model checking or by a pen-and-paper proof.
Possible manipulation of user transactions by miners in a permissionless blockchain systems is a growing concern. This problem is a pervasive and systemic issue, known as Miner Extractable Value (MEV), incurs highs costs on users of decentralised applications. Furthermore, transaction manipulations create other issues in blockchain systems such as congestion, higher fees, and system instability. Detecting transaction manipulations is difficult, even though it is known that they originate from the pre-consensus phase of transaction selection for a block building, at the base layer of blockchain protocols. In this paper we summarize known transaction manipulation attacks. We then present LØ, an accountable base layer protocol specifically designed to detect and mitigate transaction manipulations. LØ is built around accurate detection of transaction manipulations and assignment of blame at the granularity of a single mining node. LØ forces miners to log all the transactions they receive into a secure mempool data structure and to process them in a verifiable manner. Overall, LØ quickly and efficiently detects reordering, injection or censorship attempts. Our performance evaluation shows that LØ is also practical and only introduces a marginal performance overhead.
We study a novel automated market maker design: the function maximizing AMM (FM-AMM). Our central assumption is that trades are batched before execution. Because of competition between arbitrageurs, the FM-AMM eliminates arbitrage profits (or LVR) and sandwich attacks, currently the two main problems in decentralized finance and blockchain design more broadly. We then consider 11 token pairs and use Binance price data to simulate the lower bound to the return of providing liquidity to an FM-AMM. Such a lower bound is, for the most part, slightly higher than the empirical returns of providing liquidity on Uniswap v3 (currently the dominant AMM).
Data security and sharing remains nuisance among many applications like business data, medical data, banking data etc. In this research, block chain technology is built with encryption algorithm for high level data security in cloud storage. Medical data security seems critical aspect due to sensitivity of patient’s information. Unauthorized access of medical data creates major issue to patients. This article proposed block chain with hybrid encryption technique for securing medical data stored in block chain model at cloud storage. New Two fish encryption model is implemented based on RSA Multiple Precision Arithmetic (MPA). MPA works by using library concept. The objective of using this methodology is to enhance security performance with less execution time. Patient data is processed by encryption algorithm and stored at blockchain infrastructure using encrypted key. Access permission allows user to read or write the medical data attached in block chain framework. The performance of traditional cryptographic techniques is very less in providing security infrastructure. Proposed blockchain based Two fish encryption technique provides high security in less encryption and decryption time.
The incentive-compatibility properties of blockchain transaction fee mechanisms have been investigated with *passive* block producers that are motivated purely by the net rewards earned at the consensus layer. This paper introduces a model of *active* block producers that have their own private valuations for blocks (representing, for example, additional value derived from the application layer). The block producer surplus in our model can be interpreted as one of the more common colloquial meanings of the term ``MEV.'' The main results of this paper show that transaction fee mechanism design is fundamentally more difficult with active block producers than with passive ones: with active block producers, no non-trivial or approximately welfare-maximizing transaction fee mechanism can be incentive-compatible for both users and block producers. These results can be interpreted as a mathematical justification for the current interest in augmenting transaction fee mechanisms with additional components such as order flow auctions, block producer competition, trusted hardware, or cryptographic techniques.
Web3Recommend is a decentralized Social Recommender System implementation that enables Web3 Platforms on Android to generate recommendations that balance trust and relevance. Generating recommendations in decentralized networks is a non-trivial problem because these networks lack a global perspective due to the absence of a central authority. Further, decentralized networks are prone to Sybil Attacks in which a single malicious user can generate multiple fake or Sybil identities. Web3Recommend relies on a novel graph-based content recommendation design inspired by GraphJet, a recommendation system used in Twitter enhanced with MeritRank, a decentralized reputation scheme that provides Sybil-resistance to the system. By adding MeritRank's decay parameters to the vanilla Social Recommender Systems' personalized SALSA graph algorithm, we can provide theoretical guarantees against Sybil Attacks in the generated recommendations. Similar to GraphJet, we focus on generating real-time recommendations by only acting on recent interactions in the social network, allowing us to cater temporally contextual recommendations while keeping a tight bound on the memory usage in resource-constrained devices, allowing for a seamless user experience. As a proof-of-concept, we integrate our system with MusicDAO, an open-source Web3 music-sharing platform, to generate personalized, real-time recommendations. Thus, we provide the first Sybil-resistant Social Recommender System, allowing real-time recommendations beyond classic user-based collaborative filtering. The system is also rigorously tested with extensive unit and integration tests. Further, our experiments demonstrate the trust-relevance balance of recommendations against multiple adversarial strategies in a test network generated using data from real music platforms.
Open and permissionless blockchains are distributed systems with thousands to tens of thousands of nodes, establishing novel platforms for decentralized applications. When realizing such an application, data might be stored and retrieved from one or more blockchains by distributed network nodes without relying on centralized coordination and trusted third parties. Data access could be provided through a query language such as SQL at the application level, establishing a unified view on application-level data that is verifiably stored. However, when accessing multiple blockchains through their node software and APIs, interoperability cannot be assumed today, resulting in challenges of inhomogeneous data access. In addition, different feature sets and trade-offs exist, e.g., regarding smart contract functionality, availability, distribution, scalability, and security. For increasing interoperability, the paper at hand suggests pursuing the development of a cross-chain query language at the application level. The language abstracts from implementation by providing a standardized syntax, an integrated data model, and a processing architecture for data queries. This research is an extended and updated paper of a prior publication demonstrating the language syntax, data model, and architecture with an evaluation of compatibility against the largest open and permissionless blockchains today.
One of the most important features of blockchain protocols is decentralization, as their main contribution is that they formulate a distributed ledger that will be maintained and extended without the need of a trusted party. Bitcoin has been criticized for its tendency to centralization, as very few pools control the majority of the hashing power. Pass et al. proposed FruitChain [PODC 17] and claimed that this blockchain protocol mitigates the formation of pools by reducing the variance of the rewards in the same way as mining pools, but in a fully decentralized fashion. Many follow up papers consider that the problem of centralization in Proof-of- Work (PoW) blockchain systems can be solved via lower rewards' variance, and that in FruitChain the formation of pools is unnecessary. Contrary to the common perception, in this work, we prove that lower variance of the rewards does not eliminate the tendency of the PoW blockchain protocols to centralization; miners have also other incentives to create large pools, and specifically to share the cost of creating the instance they need to solve the PoW puzzle. We abstract the procedures of FruitChain as oracles and assign to each of them a cost. Then, we provide a formal definition of a pool in a blockchain system, and by utilizing the notion of equilibrium with virtual payoffs (EVP) [AFT 21], we prove that there is a completely centralized EVP, where all the parties form a single pool controlled by one party called the pool leader. The pool leader is responsible for creating the instance used for the PoW procedure. To the best of our knowledge, this is the first work that examines the construction of mining pools in the FruitChain system.
At the core of each blockchain system, parties communicate through a peer-to-peer (P2P) overlay. Unfortunately, recent evidence suggests these P2P overlays represent a significant bottleneck for transaction throughput and scalability. Furthermore, they enable a number of attacks. We argue that these performance and security problems arise because current P2P overlays cannot fully capture the complexity of a blockchain system as they do not offer flexibility to accommodate node heterogeneity. We propose a novel approach to address these issues: P2P Overlay Domains with Sovereignty (PODS), which allows nodes in a single overlay to belong to multiple heterogeneous groups, called domains. Each domain features its own set of protocols, tailored to the characteristics and needs of its nodes. To demonstrate the effectiveness of PODS, we design and implement two novel node discovery protocols: FedKad and SovKad. Using a custom simulator, we show that node discovery using PODS (SovKad) architecture outperforms both single overlay (Kademlia) and multi-overlay (FedKad) architectures in terms of hop count and success rate, though FedKad requires slightly less bandwidth.
Zhihao Hao, Guancheng Wang, Chunwei Tian, Bob Zhang
The recurrent neural network has been greatly developed for effectively solving time-varying problems corresponding to complex environments. However, limited by the way of centralized processing, the model performance is greatly affected by factors like the silos problems of the models and data in reality. Therefore, the emergence of distributed artificial intelligence such as federated learning (FL) makes it possible for the dynamic aggregation among models. However, the integration process of FL is still server-dependent, which may cause a great risk to the overall model. Also, it only allows collaboration between homogeneous models, and does not have a good solution for the interaction between heterogeneous models. Therefore, we propose a Distributed Computation Model (DCM) based on the consortium blockchain network to improve the credibility of the overall model and effective coordination among heterogeneous models. In addition, a Distributed Hierarchical Integration (DHI) algorithm is also designed for the global solution process. Within a group, permissioned nodes collect the local models' results from different permissionless nodes and then sends the aggregated results back to all the permissionless nodes to regularize the processing of the local models. After the iteration is completed, the secondary integration of the local results will be performed between permission nodes to obtain the global results. In the experiments, we verify the efficiency of DCM, where the results show that the proposed model outperforms many state-of-the-art models based on a federated learning framework.
Electronic Health Records (EHRs) have undergone numerous technical improvements in recent years, including the incorporation of mobile devices with the cloud computing technologies to facilitate medical data exchanges between patients and the healthcare professionals. This cutting-edge architecture enables cyber physical systems housed in the cloud to provide healthcare services with minimal operational costs, high flexibility, security, and EHR accessibility. If patient health information is stored in the hospital database, there will always be a risk of intrusion, i.e., unauthorized file access and information modification by attackers. To address this concern, we propose a decentralized EHR system based on Blockchain technology. To facilitate secure EHR exchange across various patients and medical providers, we develop a reliable access control method based on smart contracts. We incorporate Cryptocurrency, specifically Ethereum, in the suggested system to protect sensitive health information from potential attackers. In our suggested approach, both physicians and patients are required to be authenticated. Patients can register, and a block with a unique hash value will be generated. Once the patient discusses the disease with the physician, the physician can check the patient's condition and offer drugs. For experimental findings, we employ the public Block chain Ganache and solidity remix-based smart contracts to protect privacy. Ethers are used as the crypto currencies.
Blockchain, as the basis for cryptocurrencies, has recently garnered significant attention. It is a type of immutable distributed ledger technology with key features including decentralization, anti-tampering, transparency, anonymity, and contract-autonomy. These attributes enable transactions to be conducted credibly within a decentralized environment. Such features are instrumental in enhancing services and driving the advancement of blockchain-based applications. The proliferation of blockchain-based applications across various sectors such as financial services, reputation systems, Internet of Things (IoT), among others is evident. However, there remain numerous challenges associated with blockchain technology such as scalability and security that require resolution. This article presents a comprehensive overview of blockchain technology and its applications. It begins by outlining the evolution of blockchain before providing an architectural overview and systematically reviewing the research and application of blockchain technology in diverse fields (including federated learning, reinforcement learning, cloud edge computing, intelligent transportation, power systems, and IoT) from both academic research and industry perspectives. Additionally highlighted are technical challenges alongside recent developments. Finally concluded are some challenges and future directions pertaining to the application of blockchain technology as well as broader perspectives for further study. Received: 24 July 2023 | Revised: 15 September 2023 | Accepted: 10 October 2023 Conflicts of Interest The authors declare that they have no conflicts of interest to this work. Data Availability Statement Data sharing is not applicable to this article as no new data were created or analyzed in this study. Author Contribution Statement Min An: Conceptualization, Methodology, Software, Formal analysis, Writing — original draft, Writing — review & editing, Visualization, Supervision, Project administration, Funding acquisition. Qiyuan Fan: Methodology, Resources, Supervision. Hao Yu: Methodology. Bo An: Conceptualization, Software, Data curation. Nannan Wu: Conceptualization, Data curation, Visualization, Project administration. Haiyang Zhao: Methodology, Validation, Resources. Xinhao Wan: Validation, Investigation. Jiaxuan Li: Validation, Investigation. Rui Wang: Validation, Investigation. Jingyu Zhen: Software, Formal analysis. Qinyan Zou: Software, Formal analysis. Bin Zhao: Software, Formal analysis.
Artificial intelligence (AI) and deep learning techniques have gained significant attraction in recent years, owing to their remarkable capability of achieving high performance across a broad range of applications. However, a crucial challenge in training such models is the acquisition of vast amounts of data, which is often limited in fields like healthcare. In this domain, medical data is typically scattered across various sources such as hospitals, clinics, and wearable devices. The aggregated data collected from multiple sources in the healthcare domain is sufficient for training advanced deep learning models. However, these sources are frequently hesitant to share such data due to privacy considerations. To address this challenge, researchers have proposed the integration of blockchain and federated learning to develop a system that facilitates the secure sharing of medical records. This work provides a succinct review of the current state of the art in the use of blockchain and federated learning in the decentralized healthcare domain.
Offering an architecture for social networking in which people have agency over their personal information and social graph is an open challenge. Here we present a grassroots architecture for serverless, permissionless, peer-to-peer social networks termed Grassroots Social Networking that aims to address this challenge. The architecture is geared for people with networked smartphones -- roaming (address-changing) computing devices communicating over an unreliable network (e.g., using UDP). The architecture incorporates (i) a decentralized social graph, where each person controls, maintains and stores only their local neighborhood in the graph; (iii) personal feeds, with authors and followers who create and store the feeds; and (ii) a grassroots dissemination protocol, in which communication among people occurs only along the edges of their social graph. The architecture realizes these components using the blocklace data structure -- a partially-ordered conflict-free counterpart of the totally-ordered conflict-based blockchain. We provide two example Grassroots Social Networking protocols -- Twitter-like and WhatsApp-like -- and address their security (safety, liveness and privacy), spam/bot/deep-fake resistance, and implementation, demonstrating how server-based social networks could be supplanted by a grassroots architecture.
The Internet of Energy (IoE) is a distributed paradigm that leverages smart networks and distributed system technologies to enable decentralized energy systems. In contrast to the traditional centralized energy systems, distributed Energy Internet systems comprise multiple components and communication requirements that demand innovative technologies for decentralization, reliability, efficiency, and security. Recent advances in blockchain architectures, smart contracts, and distributed federated learning technologies have opened up new opportunities for realizing decentralized Energy Internet services. In this paper, we present a comprehensive analysis and classification of state-of-the-art solutions that employ blockchain, smart contracts, and federated learning for the IoE domains. Specifically, we identify four representative system models and discuss their key aspects. These models demonstrate the diverse ways in which blockchain, smart contracts, and federated learning can be integrated to support the main domains of IoE, namely distributed energy trading and sharing, smart microgrid energy networks, and electric and connected vehicle management. Furthermore, we provide a detailed comparison of the different levels of decentralization, the advantages of federated learning, and the benefits of using blockchain for the IoE systems. Additionally, we identify open issues and areas for future research for integrating federated learning and blockchain in the Internet of Energy domains.
Patrik Keller, Ben Glickenhaus, George Bissias, Gregory Griffith
Proof-of-work (PoW) cryptocurrencies rely on a balance of security and fairness in order to maintain a sustainable ecosystem of miners and users. Users demand fast and consistent transaction confirmation, and in exchange drive the adoption and valuation of the cryptocurrency. Miners provide the confirmations, however, they primarily seek rewards. In unfair systems, miners can amplify their rewards by consolidating mining power. Centralization however, undermines the security guarantees of the system and might discourage users. In this paper we present Tailstorm, a cryptocurrency that strikes this balance. Tailstorm merges multiple recent protocol improvements addressing security, confirmation latency, and throughput with a novel incentive mechanism improving fairness. We implement a parallel proof-of-work consensus mechanism with $k$ PoWs per block to obtain state-of-the-art consistency guarantees. Inspired by Bobtail and Storm, we structure the individual PoWs in a tree which, by including a list of transactions with each PoW, reduces confirmation latency and improves throughput. Our proposed incentive mechanism discounts rewards based on the depth of this tree. Thereby, it effectively punishes information withholding, the core attack strategy used to reap an unfair share of rewards. We back our claims with a comprehensive analysis. We present a generic system model which allows us to specify Bitcoin, $B_k$, and Tailstorm from a joint set of assumptions. We provide an analytical bound for the fairness of Tailstorm and Bitcoin in honest networks and we confirm the results through simulation. We evaluate the effectiveness of dishonest behaviour through reinforcement learning. Our attack search reproduces known optimal strategies against Bitcoin, uncovers new ones against $B_k$, and confirms that Tailstorm's reward discounting makes it more resilient to incentive layer attacks.
Blockchain technology transformed the digital sphere by providing a transparent, secure, and decentralized platform for data security across a range of industries, including cryptocurrencies and supply chain management. Blockchain's integrity and dependability have been jeopardized by the rising number of security threats, which have attracted cybercriminals as a target. By summarizing suggested fixes, this research aims to offer a thorough analysis of mitigating blockchain attacks. The objectives of the paper include identifying weak blockchain attacks, evaluating various solutions, and determining how effective and effective they are at preventing these attacks. The study also highlights how crucial it is to take into account the particular needs of every blockchain application. This study provides beneficial perspectives and insights for blockchain researchers and practitioners, making it essential reading for those interested in current and future trends in blockchain security research.
Dominic Grandjean, Lioba Heimbach, Roger Wattenhofer
In September 2022, Ethereum transitioned from Proof-of-Work (PoW) to Proof-of-Stake (PoS) during "the merge" - making it the largest PoS cryptocurrency in terms of market capitalization. With this work, we present a comprehensive measurement study of the current state of the Ethereum PoS consensus layer on the beacon chain. We perform a longitudinal study of the history of the beacon chain. Our work finds that all dips in network participation are caused by network upgrades, issues with major consensus clients, or issues with service operators controlling a large number of validators. Further, our longitudinal staking power decentralization analysis reveals that Ethereum PoS fairs similarly to its PoW counterpart in terms of decentralization and exhibits the immense impact of (liquid) staking services on staking power decentralization. Finally, we highlight the heightened security concerns in Ethereum PoS caused by high degrees of centralization.
Byzantine Fault-Tolerant (BFT) protocols have been proposed to tolerate malicious behaviors in state machine replications. With classic BFT protocols, the total number of replicas is known and fixed a priori. The resilience of BFT protocols, i.e., the number of tolerated Byzantine replicas (denoted f ), is derived from the total number of replicas according to the quorum theory. To guarantee that an attacker cannot control more than f replicas, so to guarantee safety, it is vital to ensure fault independence among all replicas. This in practice is achieved by enforcing diverse configurations of replicas, i.e., each replica has a unique configuration, avoiding f fault compromises more than f replicas. While managing replica diversity in BFT protocols has been studied in permissioned environments with a small number of replicas, no prior work has discussed the fault independence in a permissionless environment (such as public blockchains) where anyone can join and leave the system at any time. This is particularly challenging due to the following two facts. First, with permissionless environment, any one can join as a replica at any time and no global coordinator can be relied on to manage replica diversity. Second, while great progress has been made to scale consensus algorithms to thousands of replicas, the replica diversity cannot provide fault independence at this scale, limiting practical and meaningful resilience. This paper provides the first discussion on the impact of fault independence on permissionless blockchains, provides discussions on replica configuration diversity, quantifies replica diversity by using entropy, and defines optimal fault independence.
Alexander Spiegelman, Balaji Arun, Rati Gelashvili, Zekun Li
The Narwhal system is a state-of-the-art Byzantine fault-tolerant scalable architecture that involves constructing a directed acyclic graph (DAG) of messages among a set of validators in a Blockchain network. Bullshark is a zero-overhead consensus protocol on top of the Narwhal's DAG that can order over 100k transactions per second. Unfortunately, the high throughput of Bullshark comes with a latency price due to the DAG construction, increasing the latency compared to the state-of-the-art leader-based BFT consensus protocols. We introduce Shoal, a protocol-agnostic framework for enhancing Narwhal-based consensus. By incorporating leader reputation and pipelining support for the first time, Shoal significantly reduces latency. Moreover, the combination of properties of the DAG construction and the leader reputation mechanism enables the elimination of timeouts in all but extremely uncommon scenarios in practice, a property we name Prevalent Responsiveness" (it strictly subsumes the established and often desired Optimistic Responsiveness property for BFT protocols). We integrated Shoal instantiated with Bullshark, the fastest existing Narwhal-based consensus protocol, in an open-source Blockchain project and provide experimental evaluations demonstrating up to 40% latency reduction in the failure-free executions, and up-to 80% reduction in executions with failures against the vanilla Bullshark implementation.
Lioba Heimbach, Lucianna Kiffer, Christof Ferreira Torres, Roger Wattenhofer
With Ethereum's transition from Proof-of-Work to Proof-of-Stake in September 2022 came another paradigm shift, the Proposer-Builder Separation (PBS) scheme. PBS was introduced to decouple the roles of selecting and ordering transactions in a block (i.e., the builder), from those validating its contents and proposing the block to the network as the new head of the blockchain (i.e., the proposer). In this landscape, proposers are the validators in the Proof-of-Stake consensus protocol, while now relying on specialized block builders for creating blocks with the highest value for the proposer. Additionally, relays act as mediators between builders and proposers. We study PBS adoption and show that the current landscape exhibits significant centralization amongst the builders and relays. Further, we explore whether PBS effectively achieves its intended objectives of enabling hobbyist validators to maximize block profitability and preventing censorship. Our findings reveal that although PBS grants validators the opportunity to access optimized and competitive blocks, it tends to stimulate censorship rather than reduce it. Additionally, we demonstrate that relays do not consistently uphold their commitments and may prove unreliable. Specifically, proposers do not always receive the complete promised value, and the censorship or filtering capabilities pledged by relays exhibit significant gaps.
Byzantine Consensus is fundamental for building consistent and fault-tolerant distributed systems. In traditional quorum-based consensus protocols, quorums are defined using globally known assumptions shared among all participants. Motivated by decentralized applications on open networks, the Stellar blockchain relaxes these global assumptions by allowing each participant to define its quorums using local information. A similar model called Consensus with Unknown Participants (CUP) studies the minimal knowledge required to solve consensus in ad-hoc networks where each participant knows only a subset of other participants of the system. We prove that Stellar cannot solve consensus using the initial knowledge provided to participants in the CUP model, even though CUP can. We propose an oracle called sink detector that augments this knowledge, enabling Stellar participants to solve consensus.