Roman Matzutt, Oliver Hohlfeld, Martin Henze, Robin Rawiel · 6 authors
As transaction fees skyrocket today, blockchains become increasingly expensive, hurting their adoption in broader applications. This work tackles the saving of transaction fees for economic blockchain applications. The key insight is that other than the existing "default'' mode to execute application logic fully on-chain, i.e., in smart contracts, and in fine granularity, i.e., user request per transaction, there are alternative execution modes with advantages in cost-effectiveness. On Ethereum, we propose a holistic middleware platform supporting flexible and secure transaction executions, including off-chain states and batching of user requests. Furthermore, we propose control-plane schemes to adapt the execution mode to the current workload for optimal runtime cost. We present a case study on the institutional accounts (e.g., coinbase.com) intensively sending Ether on Ethereum blockchains. By collecting real-life transactions, we construct workload benchmarks and show that our work saves 18%\sim 47%18%-47% per invocation than the default baseline while introducing 1.81%\sim 16.59%1.81%-16.59% blocks delay.
Cryptocurrencies, such as Bitcoin and 250 similar alt-coins, embody at their core a blockchain protocol --- a mechanism for a distributed network of computational nodes to periodically agree on a set of new transactions. Designing a secure blockchain protocol relies on an open challenge in security, that of designing a highly-scalable agreement protocol open to manipulation by byzantine or arbitrarily malicious nodes. Bitcoin's blockchain agreement protocol exhibits security, but does not scale: it processes 3--7 transactions per second at present, irrespective of the available computation capacity at hand.
Arthur Gervais, Ghassan Karame, Karl Wüst, Vasileios Glykantzis · 6 authors
Proof of Work (PoW) powered blockchains currently account for more than 90% of the total market capitalization of existing digital cryptocurrencies. Although the security provisions of Bitcoin have been thoroughly analysed, the security guarantees of variant (forked) PoW blockchains (which were instantiated with different parameters) have not received much attention in the literature. This opens the question whether existing security analysis of Bitcoin's PoW applies to other implementations which have been instantiated with different consensus and/or network parameters.
This paper presents a possible solution to a fundamental limitation facing all blockchain-based systems; scalability. We propose a temporal rolling blockchain which solves the problem of its current exponential growth, instead replacing it with a constant fixed-size blockchain. We conduct a thorough analysis of related work and present a formal analysis of the new rolling blockchain, comparing the results to a traditional blockchain model to demonstrate that the deletion of data from the blockchain does not impact on the security of the proposed blockchain model before concluding our work and presenting future work to be conducted.
Blockchain Technology Applications and Security
Advanced Steganography and Watermarking Techniques
Emmanuelle Anceaume, Thibaut Lajoie-Mazenc, Romaric Ludinard, Bruno Sericola
Decentralized cryptocurrency systems offer a medium of exchange secured by cryptography, without the need of a centralized banking authority. Among others, Bitcoin is considered as the most mature one. Its popularity lies on the introduction of the concept of the blockchain, a public distributed ledger shared by all participants of the system. Double spending attacks and blockchain forks are two main issues in blockchain-based protocols. The first one refers to the ability of an adversary to use the very same bitcoin more than once, while blockchain forks cause transient inconsistencies in the blockchain. We show through probabilistic analysis that the reliability of recent solutions that exclusively rely on a particular type of Bitcoin actors, called miners, to guarantee the consistency of Bitcoin operations, drastically decreases with the size of the blockchain.
Die Möglichkeit der Programmierbarkeit des Bitcoins ist fast ein nachträglicher Einfall, auch wenn Sidechain‐Vorschläge diese Programmierbarkeit ein wenig leichter machen wollen und es bereits Altcoins mit verschiedenen spezifischen Anwendungen gibt. Im Gegensatz dazu wurde das Kryptowährungstechnologieprojekt Ethereum von Vitalik Buterin, seinem Erfinder, von Tag 1 als Software‐Entwicklungsplattform für dezentrale Applikationen konzipiert, und ihre Blockchain wurde speziell entwickelt, um die Ausführung dieser dezentralen Apps (auch Dapps genannt) zu unterstützen. Vitalik Buterin, 1994 in Russland geboren, war vor der Gründung von Ethereum auch involviert in die Entwicklungsprojekte Colored Coins und Mastercoins. Er gewann 2014 den "World Technology Award" und ein Stipendium des Risikokapitalgebers Peter Thiel. In dem Diskussionspapier zu Ethereum skizzierte Buterin vor allem die Grenzen einer Programmierbarkeit der Bitcoin‐Blockchain und schlug die Erstellung einer neuen komplett programmierbaren Blockchain mit einer turing‐vollständigen Programmiersprache vor. Anders als andere Blockchain‐Projekte soll die Ethereum Software nicht nur für einen Zweck nutzbar sein – sondern soll die Basis für die Erarbeitung aller möglichen Arten von Lösungen sein und dabei die Umsetzung intelligenter Verträge (Smart Contracts) ebenso erfassen als auch die Ethereum‐spezifische Idee von dezentralen autonomen Organisationen (DAOs).
Decentralized enactment of workflows is generally advocated for data intensive scientific applications. This approach offers a number of advantages including avoiding a single (centralized) point of failure, and associated (centralized) performance bottlenecks. However, such services are often assumed to be openly available with little or no security. This is increasingly not the case. Instead organizations and the services they offer require autonomous ways of defining and enforcing their own access control policies supporting fine-grained authorization. Tackling such scenarios raises many issues regarding workflow definition, enactment and potential re-enactment. This research explores the issues related to security-oriented decentralized workflow definition and enactment. The solution is respectful of the need for autonomy of service providers and allows each participating service to define their own access control policies. We also show how different security delivery models can be supported leveraging the pulling and pushing of security credentials.
A public ledger is a tamperproof sequence of data that can be read and augmented by everyone. Public ledgers have innumerable and compelling uses. They can secure, in plain sight, all kinds of transactions ---such as titles, sales, and payments--- in the exact order in which they occur. Public ledgers not only curb corruption, but also enable very sophisticated applications ---such as cryptocurrencies and smart contracts. They stand to revolutionize the way a democratic society operates. As currently implemented, however, they scale poorly and cannot achieve their potential. Algorand is a truly democratic and efficient way to implement a public ledger. Unlike prior implementations based on proof of work, it requires a negligible amount of computation, and generates a transaction history that will not "fork" with overwhelmingly high probability. Algorand is based on (a novel and super fast) message-passing Byzantine agreement. For concreteness, we shall describe Algorand only as a money platform.
Blockchain is a distributed timestamp server technology introduced for realization of Bitcoin, a digital cash system. It has been attracting much attention especially in the areas of financial and legal applications. But such applications would fail if they are designed without knowledge of the fundamental differences in blockchain from existing technology. We show that blockchain is a probabilistic state machine in which participants can never commit on decisions, we also show that this probabilistic nature is necessarily deduced from the condition where the number of participants remains unknown. This work provides useful abstractions to think about blockchain, and raises discussion for promoting the better use of the technology.
Most popular blockchain solutions, like Bitcoin, rely on proof-of-work, guaranteeing that the output of the consensus is agreed upon with high probability. However, this probability depends on the delivery of messages and that the computational power of the system is sufficiently scattered among pools of nodes in the network so that no pool can mine more blocks faster than the crowd. New approaches, like Ethereum, generalise the proof-of-work approach by letting individuals deploy their own private blockchain with high transaction throughput. As companies are starting to deploy private chains, it has become crucial to better understand the guarantees blockchains offer in such a small and controlled environment. In this paper, we present the \emph{Blockchain Anomaly}, an execution that we experienced when building our private chain at NICTA/Data61. Even though this anomaly has never been acknowledged before, it may translate into dramatic consequences for the user of blockchains. Named after the infamous Paxos anomaly, this anomaly makes dependent transactions, like "Bob sends money to Carole after he received money from Alice" impossible. This anomaly relies on the fact that existing blockchains do not ensure consensus safety deterministically: there is no way for Bob to make sure that Alice actually sent him coins without Bob using an external mechanism, like converting these coins into a fiat currency that allows him to withdraw. We also explore smart contracts as a potential alternative to transactions in order to freeze coins, and show implementations of smart contract that can suffer from the Blockchain anomaly and others that may cope with it.
We examine a protocol $\pi_{\text{beacon}}$ that outputs unpredictable and publicly verifiable randomness, meaning that the output is unknown at the time that $\pi_{\text{beacon}}$ starts, yet everyone can verify that the output is close to uniform after $\pi_{\text{beacon}}$ terminates. We show that $\pi_{\text{beacon}}$ can be instantiated via Bitcoin under sensible assumptions; in particular we consider an adversary with an arbitrarily large initial budget who may not operate at a loss indefinitely. In case the adversary has an infinite budget, we provide an impossibility result that stems from the similarity between the Bitcoin model and Santha-Vazirani sources. We also give a hybrid protocol that combines trusted parties and a Bitcoin-based beacon.
In this paper, we shortly review current challenges of distributed automotive software architectures with respect to economic considerations and discuss several principles of the Bitcoin crypto-currency in more depth. We then point out, how future architectures could benefit from those mechanisms and highlight that future research in this direction should be performed, as we think that Bitcoin itself is not suited to enhance automotive software architectures.
Blockchain is an emerging technology for decentralized and transactional data sharing across a large network of untrusted participants. It enables new forms of distributed software architectures, where components can find agreements on their shared states without trusting a central integration point or any particular participating components. Considering the blockchain as a software connector helps make explicitly important architectural considerations on the resulting performance and quality attributes (for example, security, privacy, scalability and sustainability) of the system. Based on our experience in several projects using blockchain, in this paper we provide rationales to support the architectural decision on whether to employ a decentralized blockchain as opposed to other software solutions, like traditional shared data storage. Additionally, we explore specific implications of using the blockchain as a software connector including design trade-offs regarding quality attributes.
Alexander Chepurnoy, Mario Larangeira, Alexander Ojiganov
Bitcoin is the first successful decentralized global digital cash system. Usefulness of the mining process requiring a lot of computational resources to be wasted, though, remains disputable. One of possible alternatives for useful Proof-of-Work schemes, Permacoin, is using non-interactive proofs of a static dataset retrievability thus providing a mechanism to store a huge dataset being spread across miners collectively.
In this paper we present a new consensus protocol for Bitcoin-like peer-to-peer systems, where the right to generate a block is given to the party which provides non-interactive proofs of retrievability for the past state snapshots. This Proof-of-Work scheme has better resistance to specialized hardware than Bitcoin and Permacoin. Unlike blockchain systems being used today, a network using the protocol of ours is safe if majority of nodes are rational in terms of storing full blocks. By using that we also show that one useful application of our protocol is the construction of a prunable blockchain system without a security loss.
Alexander Chepurnoy, Mario Larangeira, Alexander Ojiganov
Bitcoin is the first successful decentralized global digital cash system. Its mining process requires intense computational resources, therefore its usefulness remains a disputable topic. We aim to solve three problems with Bitcoin and other blockchain systems of today by repurposing their work. First, space to store a blockchain is growing linearly with number of transactions. Second, a honest node is forced to be irrational regarding storing full blocks by a way implementations are done. Third, a trustless bootstrapping process for a new node involves downloading and processing all the transactions ever written into a blockchain. In this paper we present a new consensus protocol for Bitcoin-like peer-to-peer systems where a right to generate a block is given to a party providing non-interactive proofs of storing a subset of the past state snapshots. Unlike the blockchain systems in use today, a network using our protocol is safe if the nodes prune full blocks not needed for mining. We extend the GKL model to describe our Proof-of-Work scheme and a transactional model modifications needed for it. We provide a detailed analysis of our protocol and proofs of its security.
Blockchain (BC) has received significant attention recently. This paper presents system-related issues for BCs for financial applications. This paper first presents the design of a BC without consideration of any application scenarios, and issues such as performance, security, performance and scalability lead to specific BC designs. Sample BC scenarios are analyzed and these lead to additional BC designs. Specifically, two new kinds of BC emerge: for storing information at transactional level, for storing account information. By splitting traditional BCs into these two BCs allow one to optimize the system with respect to scalability and privacy.
Eleftherios Kokoris-Kogias, Philipp Jovanovic, Nicolas Gailly, Ismail Khoffi · 6 authors
While showing great promise, Bitcoin requires users to wait tens of minutes\nfor transactions to commit, and even then, offering only probabilistic\nguarantees. This paper introduces ByzCoin, a novel Byzantine consensus protocol\nthat leverages scalable collective signing to commit Bitcoin transactions\nirreversibly within seconds. ByzCoin achieves Byzantine consensus while\npreserving Bitcoin's open membership by dynamically forming hash\npower-proportionate consensus groups that represent recently-successful block\nminers. ByzCoin employs communication trees to optimize transaction commitment\nand verification under normal operation while guaranteeing safety and liveness\nunder Byzantine faults, up to a near-optimal tolerance of f faulty group\nmembers among 3f + 2 total. ByzCoin mitigates double spending and selfish\nmining attacks by producing collectively signed transaction blocks within one\nminute of transaction submission. Tree-structured communication further reduces\nthis latency to less than 30 seconds. Due to these optimizations, ByzCoin\nachieves a throughput higher than PayPal currently handles, with a confirmation\nlatency of 15-20 seconds.\n
Bitcoin is the first decentralized peer-to-peer (P2P) electronic currency. It was created in November 2008 by Satoshi Nakamoto. Nakamoto released the first implementation of the protocol in an open source client software and the genesis of bitcoins began on January 9th 2009. The Bitcoin protocol is based on clever ideas which solve a form of the Byzantine Generals Problem and sets the foundation for Decentralized Trust Protocols. Still in its infancy, the currency and the protocol have the potential to disrupt the international financial system and other sectors where business is based on trusted third parties. The security of the bitcoin protocol relies on strong cryptography and one way hashing algorithms.
I present the design and implementation of a novel anti-malware environment called BitAV. BitAV allows for the decentralization of the update and maintenance mechanisms of the software, traditionally performed by a central host, and uses a staggered scanning mechanism in order to improve performance. The peer-to-peer network maintenance mechanism lowered the average update propagation speed by 500% and is far less susceptible to targeted denial-of-service attacks. The feedforward scanning mechanism significantly improved end-to-end performance of the malware matching system, to a degree of an average 14x increase, by decomposing the file matching process into efficient queries that operate in verifiably constant time.
Distributed consensus (aka Byzantine agreement [Pease, Shostak & Lamport, 1980]) is one of the fundamental problems in fault-tolerant distributed computing and cryptographic protocols. It requires correct participants (parties) to reach agreement on initially held values despite the arbitrary behavior of some of them, with the additional requirement (known as Validity) that if all the correct participants start off with the same value, then that must be the decision value. The problem has been studied extensively in both the unconditional setting (where no assumptions are made about the computational power of the adversary) and the cryptographic setting, and efficient (i.e., polynomial-time) solutions exist tolerating the optimal number of misbehaving parties and running in the optimal number of rounds, on networks with pairwise authenticated channels. In many interesting scenarios, however, such as "peer-to-peer" networks, where parties come and go as they please and there are no prior relations among them, such infrastructure (pairwise authenticated channels, public-key infrastructure) is unavailable, thus raising the question whether anything "interesting" can be achieved. In this talk we answer this question in the affirmative, presenting two new probabilistic consensus protocols based on "proofs of work" (POWs, aka "moderately hard functions," "cryptographic puzzles" [Dwork & Naor, 1992]), the technology underlying Bitcoin, the first and most popular decentralized cryptocurrency to date. (In Bitcoin, POWs are implemented using the SHA-256 cryptographic hash function, by finding preimages that produce values in a given smaller domain.) In more detail, we first extract and analyze the core of the Bitcoin protocol, which we term the Bitcoin backbone, and prove two fundamental properties of its "blockchain" approach which we call "common prefix" and "chain quality." The consensus protocols can then be built as applications on top of the backbone protocol, with the Agreement and Validity properties following from common prefix and chain quality, respectively. The first protocol works assuming the adversary's hashing power is bounded by 1/3 of the network's total hashing power. The second consensus protocol is more elaborate, relies on the notion of robust transaction ledgers, which capture the essence of Bitcoin's operation as a cryptocurrency, and works assuming the adversary's hashing power is strictly less than 1/2.
Blockchains and Byzantine Fault Tolerance form the basis of decentralized currencies and ledgers such as Bitcoin, Ripple, ZeroCash, and Ethereum. A large slate of literature has focused on the currency aspects (e.g. anonymity, independence from central banks, etc.). We argue that, as-far-as Distributed Payment Transactions Networks (PTNs) are concerned, there are other, possibly more interesting, properties. This paper provides a systematic review of both traditional PTNs and their analogues in decentralized ledgers and associates different technological features to the corresponding business and financial requirements. We provide a conceptual classification of the key properties (value creation, payment promise, transaction fulfillment, and value preservation). We map existing (distributed) PTNs into the classification showing different alternatives are possible. Furthermore, the ideas behind distributed ledgers can be extended beyond payments and contracts. We illustrate the idea of derivatives-contracts-as-programs that are marked to market (or an account that is margined) automatically by computations run on, and whose ownership transitions are recorded, in a distributed payment network.
The past several years have seen the surprising and rapid rise of Bitcoin and other “cryptocurrencies.” These are decentralized peer-to-peer networks that allow users to transmit money, tocompose financial instruments, and to enforce contracts between mutually distrusting peers, andthat show great promise as a foundation for financial infrastructure that is more robust, efficientand equitable than ours today. However, it is difficult to reason about the security of cryptocurrencies. Bitcoin is a complex system, comprising many intricate and subtly-interacting protocol layers. At each layer it features design innovations that (prior to our work) have not undergone any rigorous analysis. Compounding the challenge, Bitcoin is but one of hundreds of competing cryptocurrencies in an ecosystem that is constantly evolving. The goal of this thesis is to formally reason about the security of cryptocurrencies, reining in their complexity, and providing well-defined and justified statements of their guarantees. We provide a formal specification and construction for each layer of an abstract cryptocurrency protocol, and prove that our constructions satisfy their specifications. The contributions of this thesis are centered around two new abstractions: “scratch-off puzzles,” and the “blockchain functionality” model. Scratch-off puzzles are a generalization of the Bitcoin “mining” algorithm, its most iconic and novel design feature. We show how to provide secure upgrades to a cryptocurrency by instantiating the protocol with alternative puzzle schemes. We construct secure puzzles that address important and well-known challenges facing Bitcoin today, including wasted energy and dangerous coalitions. The blockchain functionality is a general-purpose model of a cryptocurrency rooted in the “Universal Composability” cryptography theory. We use this model to express a wide range of applications, including transparent “smart contracts” (like those featured in Bitcoin and Ethereum), and also privacy-preserving applications like sealed-bid auctions. We also construct a new protocol compiler, called Hawk, which translates user-provided specifications into privacy-preserving protocols based on zero-knowledge proofs.