Recursive Length Prefix (RLP) is used to encode a wide variety of data in Ethereum, including transactions. The work described in this paper provides a formal specification of RLP encoding and a verified implementation of RLP decoding, developed in the ACL2 theorem prover. This work has led to improvements to the Ethereum documentation and additions to the Ethereum test suite.
Massimiliano Sala, Domenica Sogiorno, Daniele Taufer
We show how a small subgroup confinement-like attack may be mounted on the Bitcoin addresses generation protocol, by inspecting a special subgroup of the group associated to point multiplication. This approach does not undermine the system security but highlights the importance of using fair random sources during the private key selection.
Neville Grech, Michael Kong, Anton Jurisevic, Lexi Brent · 6 authors
Ethereum is a distributed blockchain platform, serving as an ecosystem for smart contracts: full-fledged intercommunicating programs that capture the transaction logic of an account. A gas limit caps the execution of an Ethereum smart contract: instructions, when executed, consume gas, and the execution proceeds as long as gas is available. Gas-focused vulnerabilities permit an attacker to force key contract functionality to run out of gas---effectively performing a permanent denial-of-service attack on the contract. Such vulnerabilities are among the hardest for programmers to protect against, as out-of-gas behavior may be uncommon in nonattack scenarios and reasoning about these vulnerabilities is nontrivial. In this paper, we identify gas-focused vulnerabilities and present MadMax: a static program analysis technique that automatically detects gas-focused vulnerabilities with very high confidence. MadMax combines a smart contract decompiler and semantic queries in Datalog. Our approach captures high-level program modeling concepts (such as "dynamic data structure storage" and "safely resumable loops") and delivers high precision and scalability. MadMax analyzes the entirety of smart contracts in the Ethereum blockchain in just 10 hours and flags vulnerabilities in contracts with a monetary value in billions of dollars. Manual inspection of a sample of flagged contracts shows that 81% of the sampled warnings do indeed lead to vulnerabilities.
U ovom diplomskom radu je opisan problem korištenja podataka iz vanjskih izvora u kontekstu raspodijeljene glavne knjige koji je poznat u literaturi pod nazivom "oracle problem". Istražena su i opisana postojeća rješenja tog problema te je pojašnjen pojam decentraliziranog oracle sustava. Navedeni su tipovi takvih sustava te je objašnjeno kako oni osiguravaju integritet podataka u blok-lancu eliminirajući jedinstvenu točku ispada. Istražene su postojeće implementacije i funkcionalnosti decentraliziranih rješenja za unos podataka iz nepovjerljivih vanjskih izvora. Razvijeno je programsko rješenje za studijski slučaj koji omogućuje primjenu blok-lanca uz korištenje podataka iz vanjskih izvora gdje se koristi rješenje Chainlink s pametnim ugovorima Ethereuma.
Blockchain protocols differ in fundamental ways, including the mechanics of selecting users to produce blocks (e.g., proof-of-work vs. proof-of-stake) and the method to establish consensus (e.g., longest chain rules vs. Byzantine fault-tolerant (BFT) inspired protocols). These fundamental differences have hindered "apples-to-apples" comparisons between different categories of blockchain protocols and, in turn, the development of theory to formally discuss their relative merits. This paper presents a parsimonious abstraction sufficient for capturing and comparing properties of many well-known permissionless blockchain protocols, simultaneously capturing essential properties of both proof-of-work (PoW) and proof-of-stake (PoS) protocols, and of both longest-chain-type and BFT-type protocols. Our framework blackboxes the precise mechanics of the user selection process, allowing us to isolate the properties of the selection process that are significant for protocol design. We demonstrate the utility of our general framework with several concrete results: 1. We prove a CAP-type impossibility theorem asserting that liveness with an unknown level of participation rules out security in a partially synchronous setting. 2. Delving deeper into the partially synchronous setting, we prove that a necessary and sufficient condition for security is the production of "certificates," meaning stand-alone proofs of block confirmation. 3. Restricting to synchronous settings, we prove that typical protocols with a known level of participation (including longest chain-type PoS protocols) can be adapted to provide certificates, but those with an unknown level of participation cannot. 4. Finally, we use our framework to articulate a modular two-step approach to blockchain security analysis that effectively reduces the permissionless case to the permissioned case.
The emerging blockchain technology is the brainchild of Nakamoto, who invented bitcoin in late 2000s. The underlying structure of bitcoin is made up of blockchain, which is an open ledger of blocks linked by the hash values of subsequent blocks. Every action that happens on the blockchain is reflected on each node involved, and the data and transactions are stored on every node. We can say that blockchains provide decentralized solutions for a variety of applications, ensuring only honest parties to be part of the system at the cost of privacy. Blockchain allows mutually distrusting parties to transact cryptocurrency or involve in any other application without the involvement of trusted third party. Transparency is maintained on every level and on each transaction, leaving the data exposed to all the parties involved. In short, we can say that blockchain provides an excellent decentralized solution without privacy. On the other hand, secure computation provides privacy of data on a distributed environment without a third party, but the parties involved in computation have to be monitored carefully to ensure their honesty. Combining both the technologies leads to “ blockchain with privacy” . In recent years, research is happening into combining blockchain concepts with secure computation. While introducing data privacy to blockchain with the help of secure computation, the complexity of application increases. In this chapter, let us see how to minimize the complexity while generating distributed decentralized applications with privacy by incorporating optimized protocols for secure computation. The FGUGChain framework presented in this chapter gives a guideline for generating blockchain applications with privacy. Throughout this chapter, the term blockchain is used in the sense of public blockchain as it preserves decentralization concept, whereas the private blockchain tend to move toward centralized nature.
The novel feature of Bitcoin [N + 08] as a currency is that it is designed to be decentralised, i.e., to be run without the use of a central bank, or any centralised point of control. Beyond simply serving as currencies, however, cryptocurrencies like Bitcoin are really protocols for reaching consensus over a decentralised network of users. While running currencies is one possible application of such protocols, one might consider broad swathes of other possible applications. As one example, we have already seen
Michael Neuder, Daniel J. Moroz, Rithvik Rao, David C. Parkes
Blockchains are intended to be immutable, so an attacker who is able to delete transactions through a chain reorganization (a malicious reorg) can perform a profitable double-spend attack. We study the rate at which an attacker can execute reorgs in the Tezos Proof-of-Stake protocol. As an example, an attacker with 40% of the staking power is able to execute a 20-block malicious reorg at an average rate of once per day, and the attack probability increases super-linearly as the staking power grows beyond 40%. Moreover, an attacker of the Tezos protocol knows in advance when an attack opportunity will arise, and can use this knowledge to arrange transactions to double-spend. We show that in particular cases, the Tezos protocol can be adjusted to protect against deep reorgs. For instance, we demonstrate protocol parameters that reduce the rate of length-20 reorg opportunities for a 40% attacker by two orders of magnitude. We also observe a trade-off between optimizing for robustness to deep reorgs (costly deviations that may be net profitable because they enable double-spends) and robustness to selfish mining (mining deviations that result in typically short reorgs that are profitable even without double-spends). That is, the parameters that optimally protect against one make the other attack easy. Finally, we develop a method that monitors the Tezos blockchain health with respect to malicious reorgs using only publicly available information.
<p class="0abstract">One of the new promising technologies for the future is blockchain. It has become one of the popular techniques for various transactions and applications in many different areas such as economy, business, and government. Blockchain technology started with cryptocurrency and bitcoin applications for a safe and transparent environment. Blockchain is a hybrid technology that incorporates various technologies and tools such as mathematics, peer-peer networking, cryptography algorithms, and consensus algorithms. This survey highlights the latest studies in blockchain and consensus algorithms. The study covers the most recent blockchain applications in various domains and sectors. Furthermore, the study gives an insight into the latest adoption of the blockchain in the real world.</p>
The CAP theorem says that no blockchain can be live under dynamic participation and safe under temporary network partitions. To resolve this availability-finality dilemma, we formulate a new class of flexible consensus protocols, ebb-and-flow protocols, which support a full dynamically available ledger in conjunction with a finalized prefix ledger. The finalized ledger falls behind the full ledger when the network partitions but catches up when the network heals. Gasper, the current candidate protocol for Ethereum 2.0's beacon chain, combines the finality gadget Casper FFG with the LMD GHOST fork choice rule and aims to achieve this property. However, we discovered an attack in the standard synchronous network model, highlighting a general difficulty with existing finality-gadget-based designs. We present a construction of provably secure ebb-and-flow protocols with optimal resilience. Nodes run an off-the-shelf dynamically available protocol, take snapshots of the growing available ledger, and input them into a separate off-the-shelf BFT protocol to finalize a prefix. We explore connections with flexible BFT and improve upon the state-of-the-art for that problem.
Léonard Lys, Arthur Micoulet, Maria Potop-Butucaru
Blockchain technologies have proven their potential when it comes to store assets and value. However, swapping assets across chains, for example trading ethers for bitcoins is still a challenging problem to solve. Current solutions widely rely on trusted third parties such as exchanges, which is not acceptable for a distributed technology.
In Bitcoin, memory pool is a space of unconfirmed transactions. when a node receives newly generated transactions, the node verifies it and appends it into the local mempool. The transactions are stored in the mempool until they get included in a newly mined block. Since each node has a different capacity for storing unconfirmed transactions; thus, each node has different transactions stored in mempool. In this paper, we examine the mempool similarity using the Jaccard Index among four Bitcoin full nodes.
This paper describes a new consensus and governance model for the blockchain, with the objective of protecting the blockchain project against higher-level governance issues by design. As governance issues can lead to human problems, they can impact the proper functioning of the blockchain, leading to loss of cryptocurrency value, hard forks, and even failure of the project. We choose several fail-safe mechanisms and processes used and tested in existing Proof-of-Stake and Proof-of-Work implementations in combination with one another in order to create a framework in line with the philosophy of decentralization of the blockchain and safe against the most common technical and governance pitfalls of the field. Additionally, this composite framework offers ideal circumstances for the creation and success of Decentralized Autonomous Organizations by giving their creators more incentive to start new projects, and more involvement with the governance of the underlying blockchain.
In the present scenario, it is vital for any organization, especially the financial organizations, to understand customers and their financial dealings better. KYC is a process to verify identity and related details of corresponding customers. The current KYC mechanism has a severe concern in financial institutions as it requires separate ledger for the separate financial organizations. Every institution has its KYC process, which sometimes may include third-party, which may cause increased maintenance cost, time and redundancy. There is considerable wastage of costs in the form of opportunity cost, maintenance cost, customer verification cost and many more of around $27 million according to an economic survey. The current KYC process is very time-consuming, and it decreases the user experience. We have proposed an enhanced KYC system using blockchain technology to improve the existing KYC system. An inherent feature of the DLT is used to remove the third-party involvement, and smart contracts are used to build our logic in the mobility of the data. Blockchain technology has various types of cryptographic security which provide a safer place to transact over an unsecured channel. Using the facility of DLT, cryptography and consensus mechanism of blockchain, the proposed model of KYC process can optimize storing, updating, sharing of data and accessing operations along with enhanced security, transparency and privacy. It also enhances customer ownership and improves customer experience. It not only reduces the time duration and document update problem but also saves opportunity cost, aggregation, cost, maintenance cost and many more costs, which can affect the performance of any organization.
Proof of stake (PoS), aiming at replacing Proof of work (PoW) in blockchain consensus, has drawn great attention from academia and industry. We present “Baguena”, a novel PoS protocol for public blockchain with high practicality and security. It uses a special designed algorithm with properties of uniqueness and anonymity for leader selection, and uses the longest chain rule for chain selection. Besides, entropy is introduced to prevent manipulation of leader selection process by simulating a random beacon based on Publicly verifiable secret sharing (PVSS) and threshold signature with only a linear number of exponentiations. We analyze the protocol's security by a threat model and design a robust delegation mechanism based on triple Elliptic curve digital signature algorithm (ECDSA) proxy signature. We implement Baguena and evaluate its performance on 100 Amazon EC2 virtual machines simulating 50k users, which shows that Baguena confirms transactions in 2 minutes, achieves 2.16x of Algorand's throughput and 6.95x of Ouroboros' throughput.
Vicent Cholvi, Antonio Fernández Anta, Chryssis Georgiou, Nicolas Nicolaou · 6 authors
A Distributed Ledger Object (DLO) is a concurrent object that maintains a totally ordered sequence of records, and supports two operations:APPEND, which appends a record at the end of the sequence, andGET, which returns the whole sequence of records. The work presented in this article is made up of two main contributions.The first contribution is a formalization of aByzantine-tolerantDistributed Ledger Object(BDLO), which is a DLO in which clients and servers processes may deviate arbitrarily from their intended behavior (i.e. they may be Byzantine). The proposed formal definition is accompanied by algorithms that implementBDLOs on top of an underlying Byzantine Atomic Broadcast service.The second contribution is a suite of algorithms, based on the previous BDLO implementations, that solve the Atomic Appends problem in the presence of asynchrony, Byzantine clients and Byzantine servers. This problem occurs when clients have a composite record (set of basic records) to append to different BDLOs, in such a way that either each basic record is appended to its BDLO (and this must occur in good circumstances),or no basic record is appended. Distributed algorithms are presented, which solve the Atomic Appends problem when the clients (involved in theAtomic Appends) and the servers (which maintain the BDLOs) may be Byzantine.
There is a growing interest from both the academia and industry to employ distributed ledger technology in the Internet-of-Things domain for addressing security-related and performance challenges. Distributed ledger technology enables non-trusted entities to communicate and reach consensus in a fully distributed manner through a cryptographically secure and immutable ledger. However, significant challenges arise mainly related to transaction processing speed and user privacy. This work explores the interplay between Internet-of-Things and distributed ledger technology, analysing the fundamental characteristics of this technology and discussing the related benefits and challenges.
Asset custody is a core financial service in which the custodian holds in-safekeeping assets on behalf of the client. Although traditional custody service is typically endorsed by centralized authorities, decentralized custody scheme has become technically feasible since the emergence of digital assets, and furthermore, it is greatly needed by new applications such as blockchain and DeFi (Decentralized Finance). In this work, we propose a framework of decentralized asset custody scheme that is able to support a large number of custodians and safely hold customer assets of multiple times the value of the total security deposit. The proposed custody scheme distributes custodians and assets into many custodian groups via combinatorial designs, where each group fully controls the assigned assets. Since every custodian group is small, the overhead cost is significantly reduced. The liveness is also improved because even a single alive group would be able to process transactions. The security of this custody scheme is guaranteed under the rational adversary model, such that any adversary corrupting a bounded fraction of custodians cannot move assets more than the security deposit paid. We further analyze the security and performance of our constructions from both theoretical and experimental sides and give explicit examples with concrete numbers and figures for a better understanding of our results.
Laurens Van Hoye, Tim Wauters, Filip De Turck, Bruno Volckaert
Summary Organizations share data in a cross‐organizational context when they have the goal to derive additional knowledge by aggregating different data sources. The collaborations considered in this article are short‐lived and ad hoc, that is, they should be set up in a few minutes at most (e.g., in emergency scenarios). The data sources are located in different domains and are not publicly accessible. When a collaboration is finished, it is however unclear which exchanges happened. This could lead to possible disputes when dishonest organizations are present. The receipt of requests/responses could be falsely denied or their content could be point of discussion. In order to prevent such disputes afterwards, a logging mechanism is needed which generates a replicated irrefutable proof of which exchanges have happened during a single collaboration. Distributed database solutions can be taken from third parties to store the generated logs, but it can be difficult to find a party which is trusted by all participating organizations. Permissioned blockchains provide a solution for this as each organization can act as a consensus participant. Although the consensus mechanism of the permissioned blockchain Hyperledger Fabric (versions 1.0–1.4) is not fully decentralized, which clashes with the fundamental principle of blockchain, the framework is used in this article as an enabler to set up a distributed database, and a proposal for a logging mechanism is presented which does not require the third party to be fully trusted. A proof of concept is implemented which can be used to experiment with different data exchange setups. It makes use of generic web APIs and behaves according to a Markov chain in order to create a fully automated data exchange scenario where the participants explore their APIs dynamically. The resulting mechanism allows a data‐delivering organization to detect missing logs and to take action, for example, (temporarily) suspend collaboration. Furthermore, each organization is incentivized to follow the steps of the logging mechanism as it may lose access to data of others, otherwise. The created proof of concept is scaled to 10 organizations, which autonomously exchange different data types for 10 min, and evaluation results are presented accordingly.
We propose a new Proof-of-Stake consensus protocol based on a Sequential Proof-of-Work constructed with a verifiable random function (VRF) and a verifiable delay function (VDF) that has the following properties: a) all addresses with positive stake can participate; b) is fair because the coin stake is proportional to the distribution of rewards; c) is resistant to several classic blockchain attacks such as Sybil attacks, Nothing-at-stake attacks and Winner-takes-all attacks. We call it Vixify Consensus. We introduce a variant of sequential Proof-of-Work puzzles with applications on Distributed Randomness Beacons.
We propose a new Proof-of-Stake consensus protocol constructed with a verifiable random function (VRF) and a verifiable delay function (VDF) that has the following properties: a) all addresses with positive stake can participate; b) is fair because the coin stake is proportional to the distribution of rewards; c) is resistant to several classic blockchain attacks such as Sybil attacks, "Nothing-at-stake" attacks and "Winner-takes-all" attacks. We call it Vixify Consensus.
Blockchains help to build trust among a decentralized network of unknown and untrusted peers who need to agree on a common protocol and trust the correctness and compatibility of the corresponding software implementations. The software engineering discipline cannot ignore this trend, as it fundamentally affects the way software is designed, developed, deployed, and delivered.1 As with the emergence of the Internet, software smart contracts for solving new classes of real-world problems, as opposed to introducing blockchains everywhere, where they may be unnecessary, or provide an inefficient and environmentally unsound solution.4