Blockchain Papers

Marcel Müller, Nadine Ostern, Sandro Rodriguez Garzon, Axel Küpper

No abstract is available for this record.

Palina Tolmach, Yi Li, Shang‐Wei Lin, Yang Liu

Decentralized finance (DeFi) has become one of the most successful applications of blockchain and smart contracts. The DeFi ecosystem enables a wide range of crypto-financial activities, while the underlying smart contracts often contain bugs, with many vulnerabilities arising from the unforeseen consequences of composing DeFi protocols together. In this paper, we propose a formal process-algebraic technique that models DeFi protocols in a compositional manner to allow for efficient property verification. We also conduct a case study to demonstrate the proposed approach in analyzing the composition of two interacting DeFi protocols, namely, Curve and Compound. Finally, we discuss how the proposed modeling and verification approach can be used to analyze financial and security properties of interest.

Vipin Deval, Alex Norta, Patrick Dai, Neil Mahi · 5 authors

No abstract is available for this record.

Wulf A. Kaal

No abstract is available for this record.

Jakub Śliwiński, Roger Wattenhofer

No abstract is available for this record.

Qian Hu, Biwei Yan, Yubing Han, Jiguo Yu

Aiming at the problems of the existing DPoS(Delegated Proof of Stake) consensus algorithm, such as low enthusiasm of voting nodes and difficulties in dealing with malicious nodes, we improve the traditional DPoS consensus algorithm and propose a reputation-based delegated proof of stake consensus algorithm, called Reputation-DPoS. In our Reputation-DPoS, the reputation model is introduced. By evaluating the behavior of nodes, nodes are divided into different trusted states, and high-quality nodes in the network are selected as consensus nodes to reduce security risks and improve efficiency. Besides, incentive methods of reputation and token are used to improve the enthusiasm of nodes to participate in voting. Simulation results show that our Reputation-DPoS can reduce the probability of malicious nodes being selected and optimize the state of nodes in DPoS. Nodes with good behavior will get more votes and rewards, which will motivate nodes and improve the security of the system. Insert here your abstract text.

Hyoungsung Kim, Jaehyuk Jang, Sangjun Park, Heung-No Lee

The error-correction code proof-of-work (ECCPoW) algorithm is based on a low-density parity-check (LDPC) code. ECCPoW can impede the advent of mining application-specific integrated circuits (ASICs) with its time-varying puzzle generation capability. Previous research studies on the ECCPoW algorithm have presented its theory and implementation on Bitcoin. In this study, we have not only designed ECCPoW for Ethereum, called ETH-ECC, but have also implemented, simulated, and validated it. In the implementation, we have explained how the ECCPoW algorithm has been integrated into Ethereum 1.0 as a new consensus algorithm. Furthermore, we have devised and implemented a new method for controlling the difficulty level in ETH-ECC. In the simulation, we have tested the performance of ETH-ECC using a large number of node tests and demonstrated that the ECCPoW Ethereum works well with automatic difficulty-level change capability in real-world experimental settings. In addition, we discuss how stable the block generation time (BGT) of ETH-ECC is. Specifically, one key issue we intend to investigate is the finiteness of the mean of ETH-ECC BGT. Owing to a time-varying cryptographic puzzle generation system in the ECCPoW algorithm, the BGT in the algorithm may lead to a long-tailed distribution. Thus, simulation tests have been performed to determine whether the BGT distribution is heavy-tailed and has a finite mean. If the distribution is heavy-tailed, transaction confirmation cannot be guaranteed. In the validation, we have presented statistical analysis results based on the two-sample Anderson–Darling test and discussed how the BGT distribution satisfies the necessary to be considered an exponential distribution. Our implementation is available for download at https://github.com/cryptoecc/ETH-ECC.

V. S. Dhillon, David Metcalf, Max Hooper

Ethereum is an open source, decentralized blockchain platform with computational capabilities that reconstructs an elementary currency exchange into a transfer of value between users via a scripting language. Ethereum is widely recognized as a successor to the Bitcoin protocol, generalizing the original ideas and enabling a more diverse array of applications to be built on top of the blockchain technology. Ethereum has two essential components. First, there is a Turing-complete virtual processor that can load resources and execute scripts called the Ethereum Virtual Machine (EVM). The second component is a token of value called ether, which is the currency of the network and is used for user-to-user transactions or compensation to miners of the network. In this chapter, we begin our journey with an overview of Ethereum’s architecture in comparison to Bitcoin, focusing on the EVM and Turing-completeness properties. Following the overview of its architecture, there is a short discussion of the accounts model in Ethereum and account representation with Merkle-Patricia trees. This will lead us to the topics of global state representation in Ethereum, account storage, and gas, which is a spam prevention mechanism in the network. Then, we deconstruct the notion of a smart contract enabled by the EVM, the security concerns revolving around sandboxing executable code, and how the EVM pushes executable code (bytecode) to the blockchain. After that, we provide an introduction to Solidity and Vyper, two programming languages used for writing smart contracts in Ethereum. We explore the syntax of Solidity and Vyper, as well as the popular integrated development environments (IDEs) being used, and provide a brief list of key developer resources. Next, we focus on the world computer model proposed in Ethereum and introduce supporting decentralized technologies such as IPFS and Whisper. Then, we look at the state of decentralized apps (DApps) along the publishing platform called Mist available in Ethereum. This allows us to transition into talking about the Layer 2 updates to Ethereum—the major technical focus of this chapter and the maturation of the Ethereum ecosystem beyond 2020. Then, we will introduce the enterprise aspect of Ethereum, Blockchain-as-a-Service (BaaS) deployed on the Azure cloud by Microsoft. The chapter will conclude with an overview of recent technical proposals in Ethereum, the status of Layer 2 upgrades, and exciting changes on the horizon.

Cindy Vestergaard, Haimanot Anbesaw Bobosha, Karolin Langfeldt

No abstract is available for this record.

Bartosz Kuśmierz, Sebastian Müller, Angelo Capossele

In this paper, we propose several solutions to the committee selection problem among participants of a DAG distributed ledger. Our methods are based on a ledger intrinsic reputation model that serves as a selection criterion. The main difficulty arises from the fact that the DAG ledger is a priori not totally ordered and that the participants need to reach a consensus on participants' reputation. Furthermore, we outline applications of the proposed protocols, including: (i) self-contained decentralized random number beacon; (ii) selection of oracles in smart contracts; (iii) applications in consensus protocols and sharding solutions. We conclude with a discussion on the security and liveness of the proposed protocols by modeling reputation with a Zipf law.

Daniel Engel, Maurice Herlihy, Yingjie Xue

No abstract is available for this record.

Ümit Cali, Murat Kuzlu, Manisa Pipattanasomporn, James Kempf · 5 authors

No abstract is available for this record.

Caixiang Fan, Sara Ghaemi, Hamzeh Khazaei, Yuxiang Chen · 5 authors

Distributed ledgers (DLs) provide many advantages over centralized solutions in Internet of Things projects, including but not limited to improved security, transparency, and fault tolerance. To leverage DLs at scale, their well-known limitation (i.e., performance) should be adequately analyzed and addressed. Directed acyclic graph-based DLs have been proposed to tackle the performance and scalability issues by design. The first among them, IOTA, has shown promising signs in addressing the preceding issues. IOTA is an open source DL designed for the Internet of Things. It uses a directed acyclic graph to store transactions on its ledger, to achieve a potentially higher scalability over blockchain-based DLs. However, due to the uncertainty and centralization of the deployed consensus, the current IOTA implementation exposes some performance issues, making it less performant than the initial design. In this article, we first extend an existing simulator to support realistic IOTA simulations and investigate the impact of different design parameters on IOTA’s performance. Then, we propose a layered model to help the users of IOTA determine the optimal waiting time to resend the previously submitted but not yet confirmed transaction. Our findings reveal the impact of the transaction arrival rate, tip selection algorithms, weighted tip selection algorithm randomness, and network delay on the throughput. Using the proposed layered model, we shed some light on the distribution of the confirmed transactions. The distribution is leveraged to calculate the optimal time for resending an unconfirmed transaction to the DL. The performance analysis results can be used by both system designers and users to support their decision making.

Naipeng Dong, Babu Pillai, Guangdong Bai, Mark Utting

Abstract Distributed ledger technology (DLT) emerged as a disruptive force towards decentralization and has expanded beyond its origins in cryptocurrencies like Bitcoin. At the heart of DLT is an infrastructure that replicates data across multiple network nodes, enabling new opportunities for data integrity, transparency, and trust in distributed business environments. In recent years, technological advances have improved the performance, energy efficiency, and functionality of DLT, expanding its application to various sectors such as finance, healthcare, trade and media, logistics, and the public sector. Despite these advances, adoption remained limited, with notable successes primarily in areas such as decentralized finance and non-fungible tokens. By placing DLT within the historical development of ledgers and distributed databases, this Fundamental provides a business-oriented foundation for structuring and assessing DLT-based solutions. It presents, a unified definition covering blockchain technologies, describes the key characteristics of DLT, and offers a structured analysis of its potential and challenges using a multi-dimensional interaction framework. Ultimately, it serves to carve out where and under which conditions DLT infrastructures add value for interorganizational relationships.

Alexandru Cojocaru, Juan A. Garay, Aggelos Kiayias, Fang Song · 5 authors

Bitcoin and its underlying blockchain protocol have recently received significant attention in the context of building distributed systems and foundations of the consensus problem. At the same time, the rapid development in quantum computing makes the threats to cryptography more and more concerning. In this work, we revisit the formal security of the core of the Bitcoin consensus protocol, called the Bitcoin backbone (Eurocrypt 2015), in the presence of quantum adversaries -- i.e. adversaries equipped with quantum computers. We show that the security of the Bitcoin backbone holds under a quantum analogue of the ``honest majority'' assumption that we develop. The critical ingredient of proving security of the blockchain is to analyzing the quantum query complexity of a Chain-of-Proofs-of-Work search problem. This problem in turn reduces to a problem we call multi-solution Bernoulli search, for which we establish its quantum query complexity. This can be viewed as an extension of a threshold direct product theorem to an average-case unstructured search problem. Our proof, adding to active recent efforts, simplifies and generalizes the powerful recording technique due to Zhandry (Crypto 2019). Our analysis indicates that the security of the Bitcoin backbone protocol is guaranteed provided that the number of adversarial quantum queries is bounded so that each quantum query is worth $O(p^{-1/2})$ classical ones, where $p$ is the probability of success of a single classical query to the protocol's underlying hash function. Perhaps surprisingly, the wait time for safe settlement of transactions in the case of quantum adversaries matches (up to a constant) the safe settlement time in the classical case and thus does not result in any further overhead.

Jelena Mišić, Vojislav B. Mišić, Xiaolin Chang, Haytham Qushtom

This work proposes Practical Byzantine Fault Tolerance (PBFT) ordering service needed for block formation in permissioned blockchain environments. Contrary to current PBFT implementations that only provide a single point of entry to the ordering service, we allow each ordering node to act as an entry point that proposes and conducts the consensus process of including new record in the distributed ledger. To ensure atomicity of record insertion in distributed ledger, we have developed a bandwidth reservation protocol that uses a modification of CSMA/CA protocol to regulate access to the broadcast medium formed by the P2P network of TCP connections between orderers. We have modeled record insertion service time in a cluster where ordering nodes have random position within Cartesian coordinate system. We have also modeled total request access time to the ledger which includes waiting time in the orderer's queue and record insertion time. These models are used to evaluate system performance under variable request rate ordering service, variable number of nodes and variable physical cluster dimensions. Our results show the interaction between decreased request waiting time in orderer's queue and increased contention among orderers when the number of orderers increases for the given total request arrival rate. This interaction is also investigated for two different physical cluster sizes which affect record insertion time. The interplay of request rate, number of orderers and physical cluster size determines system capacity expressed in total request rate. Our model can be used to make the trade-off between the required system capacity, number of orderers, and physical cluster dimensions under constraints on Byzantine fault rate.

Mikel Cortes-Goicoechea, Leonardo Bautista-Gomez

Achieving the equilibrium between scalability, sustainability and security has prevailed as the ideal solution for decentralized blockchain applications over the last years. Several approaches have been proposed being Ethereum a solid proposal among them. Ethereum is on the path of a major protocol improvement called Ethereum 2.0 (Eth2), implementing Sharding and introducing the Proof-of-Stake (PoS). As the change of consensus mechanism is a delicate matter, this improvement will be achieved through different phases, the first of which is the implementation of the Beacon Chain. The implementation of the latest has been stated with the recent launch of the Eth2 main net. In this work, we introduce an Eth2 network monitor tool, called Armiarma, used to generate a complete analysis of the p2p network of the Eth2 main net. In this paper, we present some of the results of what this Eth2 network monitor can achieve.

Yizhong Liu, Jianwei Liu, Qianhong Wu, Hui Yu · 6 authors

Sharding blockchains are proposed to solve the scalability problem while maintaining security and decentralization. However, there are still many issues to be solved. First, the member selection and assignment process are not strictly analyzed, which might lead to an increase in the adversary proportion. Second, current intra-shard consensus algorithms are inefficient. Besides, cross-shard transaction processing costs expensive system overhead. Moreover, there is a lack of a formal security framework. In this article, we propose a secure and scalable hybrid consensus (SSHC). First, we propose a fair sharding selection scheme to select committee members, including mining processes and member lists confirmation by a reference committee. Second, a pipelined Byzantine fault tolerance for intra-shard consensus is designed, combining the pipelined technology with threshold signatures. Third, we propose a responsive sharding transaction batch processing mechanism to handle cross-shard transactions, which reduces the number of calls to Byzantine fault tolerance algorithms. Fourth, a secure committee reconfiguration method is designed to update shard members efficiently. Furthermore, we employ a formal security framework to design and analyze a sharding blockchain. For an adversary whose computational power fraction is less than$1/3$, by reasonably setting a corruption parameter and other related parameters, SSHC is proved to achieve consistency and liveness.

Leonid Al'bertovich Merkin-Janson, Ruslan Rezin, Nikolay Konstantinovich Vasilyev

In this paper we consider the software architecture of InnoChain, a distributed ledger system (DLS) with 5 levels of formal verification, including a formally-verified underlying operating system (OS). The objective of this architecture is to achieve a higher level of DLS dependability compared to more traditional software architectures and quality assurance (QA) methods. The architecture of InnoChain includes (1) a programming language for smart contracts which is a domain-specific language with formal semantics embedded into CakeML, which is a functional language ofthe ML family; this allows us to carry out formal verification of smart contracts' correctness properties using higher-order logic systems, such as HOL4; (2) trusted compilation of smart contracts into the machine code using the verified compiler available for CakeML, rather than relying on a virtual machine for execution of smart contracts; (3) using CakeML for implementation of InnoChain node functionality which allows for formal verification of code correctness and trusted compilation into the machine code; (4) formal verification of the consensus protocol used InnoChain, namely HotStuff BFT; (5) using seL4, a formally-verified microkernel, as the underlying OS for InnoChain instead of more traditional general-purpose OSes such as Linux. The proposed verified architecture will allow InnoChain to be used in mission-critical applications, such as the decentralized Aircraft Fuelling Control System which is currently under development for JSC Aeroflot, the Russian national air carrier.

Vladimir Kukharenko, Kirill Ziborov, Rafael Faritovich Sadykov, Alexandr Naumchev · 6 authors

The extent of formal verification methods applied to industrial projects has always been limited. The proliferation of distributed ledger systems (DLS), also known as blockchain, is rapidly changing the situation. Since the main area of DLSs' application is the automation of financial transactions, the properties of predictability and reliability are critical for implementing such systems. The actual behavior of the DLS is determined by the chosen consensus protocol, which properties require strict specification and formal verification. Formal specification and verification of the consensus protocol is necessary but not sufficient. It is required to ensure that the software implementation of the DLS nodes complies with this protocol. The verified software implementation of the protocol must run on a fairly reliable operating system. The so-called “smart contracts”, which are an important part of the applied implementations of specific business processes based on DLSs, must be verifiable as well. In this paper, we describe an ongoing industrial project that will result in a DLS verified at least at the four technological levels described above. We then share our experience with the formal specification and verification of HotStuff, a leader-based fault-tolerant protocol that ensures reaching distributed consensus in the presence of Byzantine processes.

Kendric Hood, Joseph Oglio, Mikhail Nesterenko, Gokarna Sharma

We consider operation of blockchain-based cryptocurrency in case of partitioning. We define the Partitionable Blockchain Consensus Problem. The problem may have an interesting solution if the partitions proceed independently by splitting accounts. We prove that this problem is not solvable in the asynchronous system. The peers in the two partitions may not agree on the last jointly mined block or, alternatively, on the starting point of independent concurrent computation. We introduce a family of detectors that enable a solution. We establish the relationship between detectors. We present the algorithm that solves the Partitionable Blockchain Consensus Problem using our detectors. We extend our solution to multiple splits, message loss and to partition merging. We simulate and evaluate the performance of detectors, discuss the implementation of the detectors and future work.

Amani Altarawneh, Fei Sun, Richard R. Brooks, Owulakemi Hambolu · 6 authors

No abstract is available for this record.

You Sun, Rui Xue, Rui Zhang, Qianqian Su · 5 authors

Blockchain technology, whose most successful application is Bitcoin, enables non-repudiation and non-tamperable online transactions without the participation of a trusted central party. As a global ledger, the blockchain achieves the consistency of replica stored on each node through a consensus mechanism. A well-designed consensus mechanism, on one hand, needs to be efficient to meet the high frequency of online transactions. For example, the existing electronic payment systems can handle over 50,000 transactions per second (TPS), while Bitcoin can only handle an average of about 3TPS. On the other hand, it needs to have good security and high fault tolerance; that is, in the case when some nodes are captured by adversaries, the network can still operate normally. In this article, we establish a reputation system, called RTChain, to be integrated into the e-commerce blockchain to achieve a distributed consensus and transaction incentives. The proposed scheme has the following advantages. First, an incentive mechanism is used to influence the consensus behavior of nodes and the transaction behavior of users, which in turn influence the reputation scores of both nodes and users. That is, when a node correctly processes a transaction, it will receive the corresponding reputation value as a reward, and the reputation value will be reduced as punishment not only when the node is dishonest and violates the consensus agreement but also the transaction is not completed as required. Just like electronic transactions in the real world, the higher the reputation of the user, the more likely it is to be selected as the transaction partner. A user with a low reputation will be gradually eliminated in our system because it is difficult to complete the transaction. Second, RTChain uses a verifiable random function to generate the leader in each round, which guarantees fairness for all participants and, unlike PoW, does not consume a large amount of computing resources. Then our consensus mechanism selects the nodes with high reputation scores to reduce the number of nodes participating in the consensus, thus improving the consensus efficiency, so that RTChain’s throughput can reach 4,000TPS. Third, we built a reputation chain to implement the distributed storage and management of reputation. Finally, our consensus mechanism is secure against existing attacks, such as flash attacks, selfish mining attacks, eclipse attacks, and double spending attacks, and allows nodes that participate in the consensus to fail, as long as the reputation of the failure node does not exceed one-third of the total reputation. We build a prototype of RTChain, and the experimental results show that RTChain is promising and deployable for e-commerce blockchains.

Dajiang Suo, Sanjay E. Sarma

Previous work on misbehavior detection and trust management can identify falsified and malicious Vehicle-to-Everything (V2X) messages and enable witness vehicles to report their observations to the trust authority for certificate management. However, there may not exist enough “benign” vehicles with V2X connectivity or vehicle owners who are willing to opt-in at an early stage of connected vehicle deployment. In this paper, we propose a security protocol for Vehicle-to-Infrastructure (V2I) communication, titled Proof-of- Travel (POT), to answer the research question: How can we transform the power of cryptography techniques embedded within the protocol into social and economic mechanisms to simultaneously incentivize V2X adoption and determine the trustworthiness of V2I data? The POT protocol determines the trust of a vehicle based on its distance traveled and the V2I information the vehicle has shared along the path of its movement. Additionally, the total vehicle mileage traveled by the vehicle must be testified by the digital signatures from infrastructure components in the vehicle's trajectory. Targeting rationale attackers motivated by profit-seeking behaviors, the POT protocol creates burdens for malicious vehicles who must acquire chains of proofs for compulsory spatial movement to gain reputation. However, the protocol does not incur extra cost for a normal vehicle who naturally moves from the origin to the destination. Instead, the verifiable vehicle mileage traveled by the normal vehicle can be used to determine its contributions and stake in the system as the altruistic behaviors of sharing observations about traffic events can benefit the transportation network. We show how to use the POT protocol to construct voting-based consensus algorithms to decide the authenticity and the correctness of vehicle-reported events and present initial simulation results.