This Week in Blockchain Research

This Week in Blockchain Research Issue #122

zk Capital — Fri, 20 Aug 2021 18:05:16 GMT

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Issue #122

Paper of the Week:

Paper Title: Decentralized Exchanges.

TLDR:
Uniswap is one of the largest decentralized exchanges with a liquidity balance of over 3 billion USD and daily trading volume of over 700 million USD.
It is designed as a system of smart contracts on the Ethereum blockchain, and is a new model of liquidity provision, so called automated market making.
This work collects and analyzes data on all 19 million Uniswap interactions from 2018 to the current time.
For this new market, it characterizes equilibrium liquidity pools and provides evidence that they are stable.
It compares this automated market maker to Binance and establishes absence of arbitrage and shows conditions under which the AMM dominates a limit order market.

Authors: Christine A. Parlour*,

Affiliations: * University of California, Berkeley.

Security:

1. Paper Title: Aggregating hash-based signatures using STARKs.

Summary: This work presents an approach for compressing regular hash-based signatures using STARKs.

Authors: Irakliy Khaburzaniya*†, Konstantinos Chalkias*†, Kevin Lewi*†, and Harjasleen Malvai*†‡,

Affiliations: * Novi, † Facebook, and ‡ Cornell University.

2. Paper Title: One-time Traceable Ring Signatures.

Summary: One-time means that the security properties – unforgeability, anonymity, non-frameability – are guaranteed only as long as a signer uses the secret key at most once.

Authors: Alessandra Scafuro* and Bihan Zhang*

Affiliations: * North Carolina State University.

Privacy:

No papers.

Scalability:

1. Paper Title: Aurora: a probabilistic algorithm for distributed ledgers enabling trustless synchronization and transaction inclusion verification.

Summary: A probabilistic algorithm that identifies honest nodes for transient or persistent communication in the presence of malicious nodes in a blockchain network, or ceases operation if it is unable to do so.

Authors: Federico Matteo Bencic* and Ivana Podnar Zarko*

Affiliations: * University of Zagreb.

Proofs:

No papers.

Consensus:

No papers.

Tokenomics:

1. Paper Title: The Limits of Code Deference.

Summary: Litigation over smart contract outcomes may disrupt—if not destroy—decentralized ventures and may have widespread unintended negative effects upon the rights and property of other decentralized venture participants and on third parties.

Authors: Andrew Hinkes*,

Affiliations: * New York University.

2. Paper Title: What Uncertainties Matter to Cryptocurrencies?

Summary: Identifying economic uncertainties salient to the price dynamics of cryptocurrencies.

Authors: Imtiaz Sifat*,

Affiliations: * Monash University.

3. Paper Title: Non-fungible token (NFT) markets on the Ethereum blockchain: Temporal development, cointegration and interrelations.

Summary: This study provides an introduction to NFTs and explores the 14 largest submarkets using data from the Ethereum blockchain between June 2017 and May 2021.

Authors: Lennart Ante*,

Affiliations: * Blockchain Research Lab.

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This Week in Blockchain Research Issue #121

zk Capital — Fri, 13 Aug 2021 19:43:01 GMT

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Issue #121

Paper of the Week:

Paper Title: On the Economic Design of Stablecoins.

TLDR:
Stablecoins are cryptocurrencies designed to trade at par with a reference asset, typically the U.S. Dollar.
While they all share the same fundamental objective of maintaining stability against their reference assets, stablecoins differ substantially in terms of their economic design, quality of backing, stability assumptions and legal protections for coin holders.
This work surfaces two critical dimensions that underpin the economic design of every stablecoin: (1) the volatility of the reserve assets against the reference asset, which defines the risk profile of the stablecoin for coin holders; and (2) the degree to which the stablecoin is exposed to the risk of a death spiral.
To address these risks, fiat-backed stablecoins must rely on reserves of high-quality, liquid assets and be subject to a framework that protects coin holders from credit risk, market risk, operational risk, as well as the insolvency or bankruptcy of the issuer.
Although decentralized stablecoin designs eliminate the need to trust an intermediary, they are either exposed to death spirals, or highly capital inefficient, as they must be highly over-collateralized to account for the lack of an intermediary.
While these trade-offs might be acceptable for narrow use cases within the cryptocurrency space, without a breakthrough in decentralized stablecoin design, they are likely to limit the usefulness of these coins for mainstream adoption.

Authors: Christian Catalini*† and Alonso de Gortari‡,

Affiliations: * Diem Association, † MIT, and ‡ Novi Financial, Inc.

Security:

No papers.

Privacy:

No papers.

Scalability:

No papers.

Proofs:

1. Paper Title: Zero-Knowledge Middleboxes.

Summary: This work introduces a modular pipeline for expressing a ZKMB circuit, and applies it to three case studies: firewalling non-HTTPS traffic, blocklisting domains for encrypted DNS, and allowlisting resolvers for oblivious DNS.

Authors: Paul Grubbs*, Arasu Arun*, Ye Zhang*, Joseph Bonneau*, and Michael Walfish*,

Affiliations: * NYU.

Consensus:

1. Paper Title: Sharding-Based Proof-of-Stake Blockchain Protocols: Security Analysis.

Summary: This article addresses the security of sharding-based blockchain protocols that are based on PoS and pBFT con- sensuses.

Authors: Abdelatif Hafid*, Abdelhakim Senhaji Hafid†, and Adil Senhaji*,

Affiliations: * University of Montreal and † Mizuho Securities.

Tokenomics:

1. Paper Title: Property rights in the Crypto age: NFTs and the auctioning of limited edition artwork.

Summary: This paper examines limited-edition auctions for the sale of digital artwork using NFTs.

Authors: Peyman Khezr* and Vijay Mohan*,

Affiliations: * Royal Melbourne Institute of Technology.

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This Week in Blockchain Research Issue #120

zk Capital — Thu, 05 Aug 2021 19:47:06 GMT

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Issue #120

Paper of the Week:

Paper Title: A Decision Model for Decentralized Autonomous Organization Platform Selection: Three Industry Case Studies.

TLDR:
Decentralized autonomous organizations as a new form of online governance are collections of smart contracts deployed on a blockchain platform that intercede groups of people.
A growing number of Decentralized Autonomous Organization Platforms, such as Aragon and Colony, have been introduced in the market to facilitate the development process of such organizations.
Selecting the best fitting platform is challenging for the organizations, as a significant number of decision criteria, such as popularity, developer availability, governance issues, and consistent documentation of such platforms, should be considered.
Additionally, decision-makers at the organizations are not experts in every domain, so they must continuously acquire volatile knowledge regarding such platforms and keep themselves updated.
Accordingly, a decision model is required to analyze the decision criteria using systematic identification and evaluation of potential alternative solutions for a development project.
This work develops a theoretical framework to assist software engineers with a set of Multi-Criteria Decision-Making problems in software production.

Authors: Elena Baninemeh*, Siamak Farshidi†, and Slinger Jansen*,

Affiliations: * Utrecht University and † University of Amsterdam.

Security:

1. Paper Title: Estimating the Node Degree of Public Peers and Detecting Sybil Peers Based on Address Messages in the Bitcoin P2P Network.

Summary: The behavior of the spamming peers can be used to determine the number of neighbors of public peers and to find Sybil peers (peers that have multiple addresses).

Authors: Matthias Grundmann* and Max Baumstark*,

Affiliations: * Karlsruhe Institute of Technology.

Privacy:

No papers.

Scalability:

No papers.

Proofs:

No papers.

Consensus:

1. Paper Title: RingBFT: Resilient Consensus over Sharded Ring Topology.

Summary: A novel meta-Bft protocol RingBFT that aims to be secure against byzantine attacks, achieves high throughputs, and incurs low latencies.

Authors: Sajjad Rahnama*, Suyash Gupta*, Rohan Sogani*, Dhruv Krishnan*, and Mohammad Sadoghi*,

Affiliations: * University of California Davis.

2. Paper Title: Using Throughput-Centric Byzantine Broadcast to Tolerate Malicious Majority in Blockchains.

Summary: Can practically usable blockchains tolerate a malicious majority, i.e., f ≥ 1/2 ?

Authors: Ruomu Hou*, Haifeng Yu*, and Prateek Saxena*,

Affiliations: * National University of Singapore.

3. Paper Title: Accountability and Forensics in Blockchains: XDC Consensus Engine DPoS 2.0.

Summary: The proposed next generation decentralized consensus engine for the XinFin XDC Network.

Authors: Gerui Wang*, Jerome Wang*, Liam Lai*, and Fisher Yu*,

Affiliations: * Hash Laboratories.

Tokenomics:

1. Paper Title: Smart Contracts, Real-Virtual World Convergence and Economic Implications.

Summary: The goal of this paper is to provide an overview of the rapidly evolving multidisciplinary literature on Smart Contracts to provide a synthesis perspective on the economic implications of smart contracts.

Authors: William Lehr*,

Affiliations: * MIT.

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This Week in Blockchain Research Issue #119

zk Capital — Wed, 28 Jul 2021 22:30:26 GMT

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Issue #119

Paper of the Week:

Paper Title: Kadcast-NG: A Structured Broadcast Protocol for Blockchain Networks.

TLDR:
In order to propagate transactions and blocks, today’s blockchain systems rely on unstructured peer-to-peer overlay networks.
In such networks, broadcast is known to be an inefficient operation in terms of message complexity and overhead.
In addition to the impact on the system performance, inefficient or delayed block propagation may have severe consequences regarding security and fairness of the consensus layer.
In contrast, the Kadcast protocol is a structured peer-to-peer protocol for block and transaction propagation in blockchain networks.
Kadcast utilizes the well-known overlay topology of Kademlia to realize an efficient broadcast operation with tunable overhead.
This work studies the security and privacy of the Kadcast protocol based on probabilistic models and analyzes its resilience to packet losses and node failures.
Moreover, it evaluates Kadcast’s block delivery performance, broadcast reliability, efficiency, and security based on advanced network simulations.
Lastly, it introduces a QUIC-based prototype implementation of the Kadcast protocol and shows its merits through deployment in a large-scale cloud-based testbed.

Authors: Elias Rohrer* and Florian Tschorsch*,

Affiliations: * Technical University of Berlin.

Security:

1. Paper Title: A Lattice-based Provably Secure Multisignature Scheme in Quantum Random Oracle Model.

Summary: A first lattice-based multisignature scheme whose security is proven in QROM.

Authors: Masayuki Fukumitsu* and Shingo Hasegawa†,

Affiliations: * Hokkaido Information University and † Tohoku University.

2. Paper Title: AToM: Active Topology Monitoring for the Bitcoin Peer-to-Peer Network.

Summary: This work thoroughly reviews network-level attacks and empirically shows that topology obfuscation is not an effective countermeasure.

Authors: Federico Franzoni*, Xavier Salleras*, and Vanesa Daza*,

Affiliations: * Universitat Pompeu Fabra.

3. Paper Title: Rectifying Administrated ERC20 Tokens.

Summary: Many smart contracts are administrated, which means that their owners solely possess an omnipotent power over these contracts.

Authors: Nikolay Ivanov*, Hanqing Guo*, and Qiben Yan*,

Affiliations: * Michigan State University.

4. Paper Title: Combining Graph Neural Networks with Expert Knowledge for Smart Contract Vulnerability Detection.

Summary: This work casts the rich control and data flow semantics of the source code into a contract graph.

Authors: Zhenguang Liu*†, Peng Qian*†, Xiaoyang Wang§, Yuan Zhuang‡, Lin Qiu§, and Xun Wang*†

Affiliations: * Zhejiang Gongshang University, † Zhejiang University, ‡ National University of Singapore, and § Southern University of Science and Technology.

Privacy:

No papers.

Scalability:

1. Paper Title: Cross-Referencing Method for Scalable Public Blockchain.

Summary: Transaction processing capacity will increase to 56,000 transactions per second, which is as much as that of a VISA credit card system.

Authors: Takaaki Yanagihara* and Akihiro Fujihara*,

Affiliations: * Chiba Institute of Technology.

2. Paper Title: Layer 2 Blockchain Scaling: a Survey.

Summary: This discussion aims at analyzing the state of the art of current available Layer II solutions to overcome these limitations, both focusing on theoretical and practical aspects and highlighting the main differences among the examined frameworks.

Authors: Cosimo Sguanci*, Roberto Spatafora*, and Andrea Mario Vergani*,

Affiliations: * Politecnico.

Proofs:

No papers.

Consensus:

No papers.

Tokenomics:

1. Paper Title: MiCA and DeFi ('Proposal for a Regulation on Market in Crypto-Assets' and 'Decentralised Finance').

Summary: This paper aims to analyze the relation between the proposal for a Regulation on Markets in Crypto-assets (MiCA), an element of the Digital Finance Package of the European Commission, and DeFi.

Authors: Guilherme Maia* & João Vieira dos Santos†,

Affiliations: * Universidade de Lisboa and † University of Porto.

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This Week in Blockchain Research Issue #118

zk Capital — Fri, 23 Jul 2021 18:18:15 GMT

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Issue #118

Paper of the Week:

Paper Title: Secure Access Control for DAG-based Distributed Ledgers.

TLDR:
Access control is a fundamental component of the design of distributed ledgers, influencing many aspects of their design, such as fairness, efficiency, traditional notions of network security, and adversarial attacks such as Denial-of-Service (DoS) attacks.
This work considers the security of a recently proposed access control protocol for Directed Acyclic Graph-based distributed ledgers.
It presents a number of attack scenarios and potential vulnerabilities of the protocol and introduces a number of additional features which enhance its resilience.
Specifically, a blacklisting algorithm, which is based on a reputation-weighted threshold, is introduced to handle both spamming and multi-rate malicious attackers.
The introduction of a solidification request component is also introduced to ensure the fairness and consistency of network in the presence of attacks.
Finally, a timestamp component is also introduced to maintain the consistency of the network in the presence of multi-rate attackers.
Simulations to illustrate the efficacy and robustness of the revised protocol are also described.

Authors: L. Zhao*, L. Vigneri†, A. Cullen*, W. Sanders†, P. Ferraro*, and R. Shorten*

Affiliations: * Imperial College London and † IOTA Foundation.

Security:

1. Paper Title: Assessment of Quantum Threat To Bitcoin and Derived Cryptocurrencies.

Summary: When will a quantum computer be powerful enough to execute Shor’s algorithm? How fast would a quantum computer need to be to break a specific cryptocurrency?

Authors: Stephen Holmes* and Liqun Chen*,

Affiliations: * University of Surrey.

Privacy:

1. Paper Title: Anonymous Blockchain-based System for Consortium.

Summary: A Multi-center Anonymous Blockchain-based (MAB) system, with joint management for the consortium and privacy protection for the participants.

Authors: Qin Wang*†, Shiping Chen†, and Yang Xiang*,

Affiliations: * Swinburne University of Technology and † CSIRO Data61.

Scalability:

1. Paper Title: Improving Blockchain Consistency by Assigning Weights to Random Blocks.

Summary: Enabling a much faster (10 ∼ 50 times with normal parameter settings) block production rate than Nakamoto protocol under the same security guarantee with the same proportion of malicious mining power.

Authors: Qing Zhang*, Xueping Gong*, Huizhong Li†, Hao Wu†, and Jiheng Zhang*,

Affiliations: * The Hong Kong University of Science and Technology and † WeBank Co., Ltd.

Proofs:

1. Paper Title: Constant-Overhead Zero-Knowledge for RAM Programs.

Summary: A ZK proof in which the communication complexity as well as the running times of the prover and verifier scale linearly in the size of the memory N and the running time T of the underlying RAM program.

Authors: Nicholas Franzese*, Jonathan Katz†, Steve Lu‡, Rafail Ostrovsky§, Xiao Wang*, and Chenkai Weng*,

Affiliations: * Northwestern University, † University of Maryland, ‡ Stealth Software Technologies, Inc., and § UCLA.

2. Paper Title: Shorter and Faster Post-Quantum Designated-Verifier zkSNARKs from Lattices.

Summary: The focus in this work is on post-quantum zkSNARKs, with a focus on minimizing proof size.

Authors: Yuval Ishai*, Hang Su†, and David J. Wu‡.

Affiliations: * Technion, † University of Virginia, and ‡ UT Austin.

Consensus:

No papers.

Tokenomics:

1. Paper Title: A Cooperative Optimal Mining Model for Bitcoin.

Summary: Analyzing Bitcoin mining from the perspective of a game and proposing an optimal mining model that maximizes profits of pools and miners.

Authors: David Lajeunesse* and Hugo D. Scolnik*,

Affiliations: * University of Buenos Aires.

2. Paper Title: Factors determining maximum energy consumption of Bitcoin miners.

Summary: A basic equation that determines energy consumption based on some specific factors: minting, transaction fees, exchange rate, energy price, and amortization cost.

Authors: Jesus M. Gonzalez-Barahona*,

Affiliations: * undisclosed.

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This Week in Blockchain Research Issue #117

zk Capital — Wed, 14 Jul 2021 20:09:33 GMT

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Issue #117

Paper of the Week:

Paper Title: Resurrecting Address Clustering in Bitcoin.

TLDR:
Blockchain analysis is essential for understanding how cryptocurrencies like Bitcoin are used in practice, and address clustering is a cornerstone of blockchain analysis.
However, current techniques rely on heuristics that have not been rigorously evaluated or optimized.
This paper tackles several challenges of change address identification and clustering.
First, it builds a ground truth set of transactions with known change from the Bitcoin blockchain that can be used to validate the efficacy of individual change address detection heuristics.
Equipped with this data set, it develops new techniques to predict change outputs with low false positive rates.
After applying the proposed prediction model to the Bitcoin blockchain, it analyzes the resulting clustering and develops ways to detect and prevent cluster collapse.
Finally, it assesses the impact the proposed enhanced clustering has on two exemplary applications.

Authors: Malte Möser* and Arvind Narayanan*,

Affiliations: * Princeton University.

Security:

1. Paper Title: Mithril: Stake-based Threshold Multisignatures.

Summary: A new stake-based primitive which allows the aggregation of individual signatures into a compact multisignature provided the stake that supports a given message exceeds a stake threshold.

Authors: Pyrros Chaidos* and Aggelos Kiayias†‡,

Affiliations: * National & Kapodistrian University of Athens and † University of Edinburgh, and ‡ IOHK.

2. Paper Title: Publicly Auditable MPC-as-a-Service with succinct verification and universal setup.

Summary: The first efficient construction for auditable MPC that has a one time universal setup.

Authors: Sanket Kanjalkar*, Ye Zhang†, Shreyas Gandlur‡, and Andrew Miller§,

Affiliations: * Blockstream Research, † New York University, ‡ Princeton University, and § University of Illinois, Urbana Champaign.

Privacy:

No papers.

Scalability:

No papers.

Proofs:

1. Paper Title: Darlin: A proof carrying data scheme based on Marlin.

Summary: A recursive SNARK for a Latus sidechain of Zendoo blockchain.

Authors: Ulrich Haböck*, Alberto Garoffolo*, and Daniele Di Benedetto*,

Affiliations: * Horizen Labs.

2. Paper Title: ECLIPSE: Enhanced Compiling method for Pedersen-committed zkSNARK Engines.

Summary: New constructions for zero-knowledge commit-and-prove SNARKs (CP- SNARKs) with a universal updatable SRS.

Authors: Diego F. Aranha*, Emil Madsen Bennedsen†, Matteo Campanelli*, Chaya Ganesh‡, Claudio Orlandi*, and Akira Takahashi*,

Affiliations: * Aarhus University, † Concordium, and ‡ Indian Institute of Science.

Consensus:

1. Paper Title: Proof-of-Stake Mining Games with Perfect Randomness.

Summary: This work investigates the incentive compatibility of longest-chain proof-of-stake protocols with access to perfect external randomness, completely independent of the blockchain.

Authors: Matheus V. X. Ferreira* and S. Matthew Weinberg*

Affiliations: * Princeton University.

Tokenomics:

1. Paper Title: Bitcoin Price Forecast Using Quantitative Models.

Summary: In front of strong volatility and apparently incomprehensible price movements, the principal three factors that move the price of the Bitcoin, the scarcity, the demand and the cost of production, can be really useful to understand the dynamics of the bitcoin price movements.

Authors: Daniele Bernardi* and Ruggero Bertelli†

Affiliations: * Diaman Partners Ltd and † University of Siena.

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This Week in Blockchain Research Issue #116

zk Capital — Thu, 08 Jul 2021 19:13:57 GMT

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Issue #116

Paper of the Week:

Paper Title: Stochastic Modelling of BlockchainConsensus.

TLDR:
Blockchain and general purpose distributed ledgers are foundational technologies which bring significant innovation in the infrastructures and other underpinnings of our socio-economic systems.
These P2P technologies are able to securely diffuse information within and across networks, without need for trustees or central authorities to enforce consensus.
This contribution proposes a minimalistic stochastic model to understand the dynamics of blockchain-based consensus.
By leveraging on random-walk theory, it models block propagation delay on different network topologies and provides a classification of blockchain systems in terms of two emergent properties.
Firstly, it identifies two performing regimes: a functional regime corresponding to an optimal system function; and a non-functional regime characterised by a congested or branched state of sub-optimal blockchains.
Secondly, it discovers a phase transition during the emergence of consensus and numerically investigate the corresponding critical point.
The results provide important insights into the consensus mechanism and sub-optimal states in decentralised systems.

Authors: Claudio J. Tessone*, Paolo Tasca†, and Flavio Iannelli*,

Affiliations: * University of Zurich and † University College London.

Security:

1. Paper Title: TokenHook: Secure ERC-20 smart contract.

Summary: An ERC-20 designed to be secure against known vulnerabilities, and can serve as a second reference implementation to provide software diversity.

Authors: Reza Rahimian* and Jeremy Clark*

Affiliations: * Concordia University.

2. Paper Title: A First Look into the Structural Properties and Resilience of Blockchain Overlays.

Summary: The most important overlay structural properties and the resilience to targeted attacks of seven distinct blockchain networks.

Authors: Aristodemos Paphitis*, Nicolas Kourtellis†, and Michael Sirivianos*,

Affiliations: * Cyprus University of Technology and † Telefonica Research.

Privacy:

No papers.

Scalability:

No papers.

Proofs:

No papers.

Consensus:

1. Paper Title: SoK: Understanding BFT Consensus in the Age of Blockchains.

Summary: This paper conducts a systematic and comprehensive study on BFT consensus protocols with a specific focus on the blockchain era.

Authors: Gang Wang*

Affiliations: * University of Connecticut.

2. Paper Title: Stochastic Performance Modeling for Practical Byzantine Fault Tolerance Consensus in Blockchain.

Summary: This paper describes a simple stochastic performance model of the PBFT consensus mechanism, which is refined as not only a queueing system with complicated service times but also a level-independent quasi-birth-and-death (QBD) process.

Authors: Fan-Qi Ma*, Quan-Lin Li†, Yi-Han Liu†, and Yan-Xia Chang†,

Affiliations: * Yanshan University and † Beijing University of Technology.

Tokenomics:

1. Paper Title: High-Frequency Connectedness between Bitcoin and Other Top-Traded Crypto Assets during the COVID-19 Crisis.

Summary: This work applies the Diagonal-BEKK model to data from the pre-COVID and COVID-19 periods, and identifies significant changes in patterns of co-movements and correlations during the pandemic period.

Authors: Paraskevi Katsiampa*, Larisa Yarovaya†, and Damian Zięba‡,

Affiliations: * University of Sheffield, † University of Southampton, and ‡ University of Warsaw.

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This Week in Blockchain Research Issue #115

zk Capital — Thu, 01 Jul 2021 23:21:02 GMT

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Issue #115

Paper of the Week:

Paper Title: Blockchain Layer Zero: Characterizing the Bitcoin Network through Measurements, Models, and Simulations.

TLDR:
In recent years, research has shown the networking layer’s significant influence on the scalability, security, and privacy of blockchain systems.
Such large-scale networks however exhibit a degree of complexity that demands model-based simulations as real-world experiments are often not possible.
This work methodically characterizes blockchain networks by reference to the paradigmatic Bitcoin peer-to-peer network, explores the state-of-the-art protocols, and emphasizes this key design space.
It conducts a longitudinal measurement study on the Bitcoin network, from which it extracts a comprehensive network model and implements it as part of the bns network simulation framework.
It validates the model in comparison to real-world measurements as well as to results from related work.
Moreover, it experimentally shows how network utilization and miners’ geographical location impact the block propagation characteristics.

Authors: Elias Rohrer* and Florian Tschorsch*,

Affiliations: * Technical University of Berlin.

Security:

1. Paper Title: A Rational Protocol Treatment of 51% Attacks.

Summary: This work utilizes the recently proposed blockchain adaptation of the rational protocol design (RPD) framework to analyze 51% double-spending attacks against Nakamoto-style proof-of-work based cryptocurrencies.

Authors: Christian Badertscher*, Yun Lu†, and Vassilis Zikas‡

Affiliations: * IOHK, † University of Edinburgh, and ‡ Purdue University.

2. Paper Title: W-OTS+ up my Sleeve! A Hidden Secure Fallback for Cryptocurrency Wallets.

Summary: A new approach to integrate a quantum-secure fallback inside an elliptic curve private key.

Authors: David Chaum*, Mario Larangeira†, Mario Yaksetig*‡, and William Carter*,

Affiliations: * xx network, † Tokyo Institute of Technology, ‡ IOHK, and § University of Porto.

3. Paper Title: Towards Verifiable Mutability for Blockchains.

Summary: A blockchain-like structure that enables the attachment and removal of information.

Authors: Erik Daniel* and Florian Tschorsch*,

Affiliations: * Technical University of Berlin.

4. Paper Title: Modeling the Block Verification Time of Zcash.

Summary: A model for the block verification time of Zcash based on transaction features and a benchmark of the Zcash client’s block verification process and its employed cryptographic primitives to support and evaluate the model.

Authors: Fabian Stiehle, Erik Daniel* and Florian Tschorsch*,

Affiliations: * Technical University of Berlin.

Privacy:

1. Paper Title: MiniLedger: Compact-sized Anonymous and Auditable Distributed Payments.

Summary: A distributed payment system which not only guarantees the privacy of transactions, but also offers built-in functionalities for various types of audits by any external authority.

Authors: Panagiotis Chatzigiannis* and Foteini Baldimtsi*,

Affiliations: * George Mason University.

Scalability:

1. Paper Title: Donner: UTXO-Based Virtual Channels Across Multiple Hops.

Summary: The first virtual channel construction over multiple intermediaries in a single round of communication.

Authors: Lukas Aumayr*, Pedro Moreno-Sanchez, Aniket Kate, and Matteo Maffei*,

Affiliations: * TU Wien, † IMDEA Software Institute, and ‡ Purdue University.

Proofs:

No papers.

Consensus:

1. Paper Title: Capacity Analysis of Public Blockchain.

Summary: This paper presents discrete-time Markov chain models to quantify the capacity of Proof-of-Work based public blockchains in non-ideal networks.

Authors: Xu Wang*, Wei Ni†, Xuan Zha‡, Guangsheng Yu*, Ren Ping Liu*, Nektarios Georgalas§, and Andrew Reeves§,

Affiliations: * University of Technology Sydney, † Data61, CSIRO, ‡ China Academy of Information and Communications Technology, and § British Telecom.

Tokenomics:

1. Paper Title: JACK THE RIPPLER: Arbitrage on the Decentralized Exchange of the XRP Ledger.

Summary: A bot that identifies and exploits arbitrage opportunities on the XRPL DEX.

Authors: Gaspard Peduzzi*, Jason James†, and Jiahua Xu†,

Affiliations: * EPFL and † UCL.

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This Week in Blockchain Research Issue #114

zk Capital — Wed, 23 Jun 2021 21:56:42 GMT

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Issue #114

Paper of the Week:

Paper Title: Blockchain Oracle Design Patterns.

TLDR:
Blockchain is a form of distributed ledger technology (DLT) where data is shared among users connected over the internet. Transactions are data state changes on the blockchain that are permanently recorded in a secure and transparent way without the need of a third party.
Besides, the introduction of smart contracts to the blockchain has added programmability to the blockchain and revolutionized the software ecosystem leading toward decentralized applications (DApps) attracting businesses and organizations to employ this technology.
Although promising, blockchains and smart contracts have no access to the external systems (i.e., off-chain) where real-world data and events resides; consequently, the usability of smart contracts in terms of performance and programmability would be limited to the on-chain data.
Hence, blockchain oracles are introduced to mitigate the issue and are defined as trusted third-party services that send and verify the external information (i.e., feedback) and submit it to smart contracts for triggering state changes in the blockchain.
This paper studies and analyzes blockchain oracles with regard to how they provide feedback to the blockchain and smart contracts.
It classifies the blockchain oracle techniques into two major groups such as voting-based strategies and reputation-based ones.
The former mainly relies on participants’ stakes for outcome finalization while the latter considers reputation in conjunction with authenticity proof mechanisms for data correctness and integrity.
Then it provides a structured description of patterns in detail for each classification and discuss research directions in the end.

Authors: Amirmohammad Pasdar*†, Zhongli Dong*‡, Young Choon Lee†,

Affiliations: * Aglive Lab, † Macquarie University, and ‡ University of Sydney.

Security:

1. Paper Title: Improving security for users of decentralized exchanges through multiparty computation.

Summary: This paper introduces a protocol based upon multiparty computation that allows for the creation of API keys and security policies that can be applied to any existing decentralized exchange.

Authors: Robert Annessi* and Ethan Fast*,

Affiliations: * Nash Exchange.

2. Paper Title: IBATCH: Saving Ethereum Fees via Secure and Cost-Effective Batching of Smart-Contract Invocations

Summary: A middleware system running on top of an operational Ethereum network to enable secure batching of smart-contract invocations against an untrusted relay server off-chain.

Authors: Yibo Wang*, Qi Zhang*, Kai Li*, Yuzhe Tang*, Jiaqi Chen*, Xiapu Luo†, and Ting Chen‡

Affiliations: * Syracuse University, † Hong Kong Polytechnic University, and ‡ University of Electronic Science and Technology of China Chengdu.

3. Paper Title: Flash Crash for Cash: Cyber Threats in Decentralized Finance.

Summary: The first overview of in-the-wild DeFi security incidents.

Authors: Kris Oosthoek*,

Affiliations: * Delft University of Technology.

Privacy:

1. Paper Title: Anonymous and Distributed Authentication for Peer-to-Peer Networks.

Summary: Three authentication protocols such that the users can authenticate themselves in an anonymous P2P network, without revealing their identities.

Authors: Pasan Tennakoon*, Supipi Karunathilaka*, Rishikeshan Lavakumar*, and Janaka Alawatugoda*,

Affiliations: * University of Peradeniya.

Scalability:

1. Paper Title: An Analysis of Transaction Handling in Bitcoin.

Summary: A predictability analysis intended to provide insights on transaction handling such as (i) transaction confirmation time, (ii) block attributes, and (iii) who has created the block.

Authors: Befekadu G. Gebraselase*, Bjarne E. Helvik*, and Yuming Jiang*,

Affiliations: * Norwegian University of Science and Technology.

Proofs:

No papers.

Consensus:

1. Paper Title: Stochastic modelling of blockchain consensus.

Summary: By leveraging on random-walk theory, this work models block propagation delay on different network topologies and provides a classification of blockchain systems in terms of two emergent properties.

Authors: Claudio J. Tessone*†, Paolo Tasca‡, and Flavio Iannelli†,

Affiliations: * Universitat Zurich and † University College London.

Tokenomics:

1. Paper Title: STO vs. ICO: A Theory of Token Issues under Moral Hazard and Demand Uncertainty.

Summary: The analysis of economic ideas behind issuing hybrid tokens that have features of both ICOs and STOs.

Authors: Anton Miglo*,

Affiliations: * University of Salford.

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This Week in Blockchain Research Issue #113

zk Capital — Wed, 16 Jun 2021 19:47:49 GMT

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Issue #113

Paper of the Week:

Paper Title: DeFi Protocol Risks: the Paradox of DeFi.

TLDR:
Decentralized Finance (or “DeFi”) is growing in volume and in importance. DeFi promises cheaper and more open access to financial services by reducing the costs and risks of using centralized intermediaries.
DeFi also holds the promise of interoperability across blockchains that could help tear down financial sector silos, greatly promoting innovation and building vibrant financial ecosystems.
However, DeFi is not without its challenges, which are understudied. This article does not seek to provide a comprehensive list of DeFi but to help readers conceptually understand the drivers behind the risks inherent in DeFi.
Many of the risks described above stem from the decentralized nature of blockchains. The goal of automating the delivery of financial services and reducing human dependencies also has the congruent effect of reducing oversight and control.
Disintermediating traditional intermediaries reduces high fees and entry friction, but also creates new opportunities for new types of intermediaries.
This article discusses some of the new types of risks introduced by DeFi that are inherent to blockchain systems along with traditional types of financial risks in DeFi that manifest in new ways: (i) interconnections with the traditional financial system, (ii) operational risks stemming from underlying blockchains, (iii) smart contract-based vulnerabilities, (iv) other governance and regulatory risks, and (v) scalability challenges.
In an effort to remove humans and automate as much as possible through smart contracts, DeFi has introduced or amplified these risks. The growth of DeFi will depend on its ability to navigate and build compatibility with traditional finance and on how laws and regulations respond.
Perhaps the biggest challenge of all is that the DeFi ecosystem continues to grow while its underlying base layer (public infrastructure such as Bitcoin or Ethereum) faces growing pains.
As DeFi grows in importance and becomes more mainstream, policymakers and industry representatives need to better understand the economic and policy consequences of these new types of risks in order to build regulatory approaches and risk management practices that can support and facilitate a healthy and robust DeFi ecosystem and, ultimately, the financial stability of the greater financial system and real economy.

Authors: Nic Carter* and Linda Jeng†

Affiliations: * Castle Island VC and † Georgetown University.

Security:

1. Paper Title: On the deployment of FlyClient as a velvet fork: chain-sewing attacks and countermeasures.

Summary: A naive velvet fork implementation exposes FlyClient to chain-sewing attacks, a novel type of attack, concurrently observed in similar superlight clients.

Authors: Tristan Nemoz*†‡ and Alexei Zamyatin*

Affiliations: * Imperial College London, † Telecom Paris, and ‡ EURECOM.

Privacy:

No papers.

Scalability:

1. Paper Title: Don’t Count on One to Carry the Ball Scaling BFT without Sacrifing Efficiency.

Summary: This paper focuses on the scalability of BFT protocols and identifies a major bottleneck to leader-based BFT protocols due to the excessive workload of the leader at large scales.

Authors: Kexin Hu*, Kaiwen Guo*, Qiang Tang†, Zhenfeng Zhang*, Hao Cheng*, and Zhiyang Zhao*,

Affiliations: * University of Chinese Academy of Sciences and † The University of Sydney.

Proofs:

1. Paper Title: SNARGs for P from LWE.

Summary: SNARGs for all polynomial-time deterministic computations based on the hardness of LWE against polynomial time adversaries.

Authors: Arka Rai Choudhuri*, Abhishek Jain*, and Zhengzhong Jin*,

Affiliations: * Johns Hopkins University.

Consensus:

1. Paper Title: Practical Settlement Bounds for Proof-of-Work Blockchains.

Summary: A rigorous framework for analyzing consistency that yields an efficient computational method for computing explicit bounds on settlement time as a function of honest and adversarial computational power and a bound on network delays.

Authors: Peter Gaži*, Ling Ren†, and Alexander Russell*,

Affiliations: * IOHK Research and † University of Illinois, Urbana-Champaign.

2. Paper Title: Efficient Asynchronous Byzantine Agreement without Private Setups.

Summary: Close the remaining efficiency gap between the communication complexity and the message complexity of private-setup free asynchronous Byzantine agreements, i.e., reducing their communication cost to only O(λn3) bits on average.

Authors: Yingzi Gao*‡, Yuan Lu*, Zhenliang Lu, Qiang Tang†, Jing Xu*, and Zhenfeng Zhang*,

Affiliations: * Institute of Software Chinese Academy of Sciences, † The University of Sydney, and ‡ University of Chinese Academy of Sciences.

Tokenomics:

1. Paper Title: Security Tokens.

Summary: This chapter synthesizes the economics, law, and technology of security tokens and Security Token Offerings (STOs).

Authors: Paul P. Momtaz*

Affiliations: * UCLA.

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This Week in Blockchain Research Issue #112

zk Capital — Wed, 09 Jun 2021 18:45:13 GMT

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Issue #112

Paper of the Week:

Paper Title: Designing Stable Coins.

TLDR:
Existing cryptocurrencies are too volatile to be used as currencies for daily payments.
Stable coins, which are cryptocurrencies pegged to other stable financial assets such as the U.S. dollar, are desirable for payments within blockchain networks, whereby being often called the “Holy Grail of cryptocurrency.”
By using the option pricing theory and the Ethereum platform that allows running smart contracts, this work designs several dual-class structures.
This work builds on the ETH cryptocurrency and offers a fixed income crypto asset (class A coin), a stable coin (class A′ coin) pegged to a traditional currency, and leveraged investment instruments (class B and B′ coins).
The investigation of the values of stable coins in presence of jump risk and black-swan type events shows the robustness of the design.

Authors: Yizhou Cao*, Min Dai*, Steven Kou†, Lewei Li*, and Chen Yang‡,

Affiliations: * National University of Singapore, † Boston University, and ‡ The Chinese University of Hong Kong.

Security:

1. Paper Title: Adaptively Secure Broadcast in Resource-Restricted Cryptography.

Summary: A thorough investigation of adaptively secure broadcast both in the property-based and in the simulation-based security settings.

Authors: Ran Cohen*, Juan Garay†, and Vassilis Zikas‡,

Affiliations: * Northeastern University, † Texas A&M University, and ‡ Purdue University.

2. Paper Title: HEX-BLOOM: An Alternative to the Merkle Tree.

Summary: An alternative model to replace the Merkle tree implemented using hash, Exclusive-OR and Bloom Filter.

Authors: Ripon Patgiri*,

Affiliations: * National Institute of Technology Silchar.

Privacy:

1. Paper Title: Analysis of CryptoNote Transaction Graphs using the Dulmage-Mendelsohn Decomposition.

Summary: How the Dulmage-Mendelsohn decomposition of bipartite graphs can be used to characterize the information revealed by CryptoNote transaction rings.

Authors: Saravanan Vijayakumaran*,

Affiliations: * Indian Institute of Technology Bombay.

Scalability:

1. Paper Title: Elmo: Recursive Virtual Payment Channels for Bitcoin.

Summary: The first Bitcoin-suitable recursive virtual channel constructor that is recursive and supports channels with an indefinite lifetime.

Authors: Aggelos Kiayias*† and Orfeas Stefanos Thyfronitis Litos†,

Affiliations: * University of Edinburgh and † IOHK.

Proofs:

No papers.

Consensus:

1. Paper Title: Modeling Coordinated vs. P2P Mining: An Analysis of Inefficiency and Inequality in Proof-of-Work Blockchains.

Summary: A simple model of a proof-of-work blockchain with latencies for both the P2P and the coordinated settings.

Authors: Mohamed Alzayat*, Johnnatan Messias*, Balakrishnan Chandrasekaran*†, Krishna P. Gummadi*, and Patrick Loiseau‡,

Affiliations: * MPI-SWS, † VU Amsterdam, and ‡ Univ. Grenoble Alpes.

2. Paper Title: PoDT: A Secure Multi-chains Consensus Scheme Against Diverse Miners Behaviors Attacks in Blockchain Networks.

Summary: A multi-chains consensus scheme to defend against Diverse Miners Behaviors (DMB) attacks.

Authors: Jingyu Feng*, Tao Wang*, and Naixue Xiong*,

Affiliations: * Xi’an University of Posts & Telecommunications.

Tokenomics:

1. Paper Title: Etherless Ethereum Tokens: Simulating Native Tokens in Ethereum.

Summary: a design methodology and formal treatment of Ethereum tokens which allow their creator to provide the option to its users of making transfers without the need to hold Ether in their wallet.

Authors: John Andrews*, Michele Ciampi‡, and Vassilis Zikas‡

Affiliations: * Sunday Group, † The University of Edinburgh, and ‡ Purdue University.

2. Paper Title: Bitcoinmania: A Ticking Time Bomb Waiting to Explode.

Summary: Bitcoin and some altcoins may become obsolete, but blockchain will continue to forge ahead unabated as many life-changing inventions have done before.

Authors: John Taskinsoy*,

Affiliations: * Universiti Malaysia Sarawak.

3. Paper Title: The non-fungible token (NFT) market and its relationship with Bitcoin and Ethereum.

Summary: This work investigates the interrelationships between NFT sales, NFT users (unique active blockchain wallets), and the pricing of Bitcoin and Ether.

Authors: Lennart Ante*,

Affiliations: * University of Hamburg.

4. Paper Title: Blockchain, Privacy, and Artwork Registries: Consensus between Constraints.

Summary: This essay explores blockchain’s implication for the art market, examines blockchain’s potentials and constraints, and proposes a starting point for the art world to reach consensus.

Authors: Yujia Zheng*,

Affiliations: * New York University.

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This Week in Blockchain Research Issue #111

zk Capital — Fri, 04 Jun 2021 16:56:17 GMT

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Issue #111

Paper of the Week:

Paper Title: GoAT: File Geolocation via Anchor Timestamping.

TLDR:
Blockchain systems are rapidly gaining traction. Decentralized storage systems like Filecoin are a crucial component of this ecosystem that aim to provide robust file storage through a Proof of Replication (PoRep) or its variants.
However, a PoRep actually offers limited robustness. Indeed if all the file replicas are stored on a single hard disk, a single catastrophic event is enough to lose the file.
This work introduces a new primitive, Proof of Geo-Retrievability or in short PoGeoRet, that enables proving that a file is located within a strict geographic boundary.
Using PoGeoRet, one can trivially construct a PoRep by proving that a file is in several distinct geographic regions.
This work defines what it means for a PoGeoRet scheme to be complete and sound, in the process making important extensions to prior formalism.
GoAT is a practical PoGeoRet scheme to prove file geolocation. Unlike previous geolocation systems that rely on trusted-verifiers, GoAT bootstraps using public timestamping servers on the internet that serve as geolocation anchors, tolerating a local threshold of dishonest anchors.
It internally uses a communication-efficient Proof-of-Retrievability (PoRet) scheme in a novel way to achieve constant-size PoRet-component in its proofs.
GoAT’s practicality is validated by conducting an initial measurement study to find usable anchors and also perform a real-world experiment. The results show that a significant fraction of the internet can be used as anchors and that GoAT achieves geolocation radii as little as 1000km.

Authors: Deepak Maram*, Iddo Bentov*, Mahimna Kelkar*, and Ari Juels*,

Affiliations: * Cornell Tech.

Security:

1. Paper Title: Hours of Horus: Keyless Cryptocurrency Wallets.

Summary: A cryptocurrency wallet in which money can be spent using a password alone, and no private keys are required.

Authors: Dionysis Zindros*,

Affiliations: * University of Athens.

2. Paper Title: Topological Anomaly Detection in Dynamic Multilayer Blockchain Networks.

Summary: The first paper on anomaly detection in dynamic multilayer networks.

Authors: Dorcas Ofori-Boateng*, Ignacio Segovia Dominguez†, Murat Kantarcioglu†, Cuneyt G. Akcora‡, and Yulia R. Gel†,

Affiliations: * Portland State University, † University of Texas at Dallas, and ‡ University of Manitoba.

Privacy:

1. Paper Title: Manta: a Plug and Play Private DeFi Stack.

Summary: A multi-asset decentralized anonymous payment scheme and an automated market maker (AMM) based decentralized anonymous exchange scheme.

Authors: Shumo Chu*†, Yu Xia‡, and Zhenfei Zhang†,

Affiliations: * UC Santa Barbara, † Manta Network, and ‡ MIT CSAIL.

2. Paper Title: SoK: Privacy-Preserving Computing in the Blockchain Era.

Summary: A systematization of knowledge of privacy-preserving solutions in cryptocurrencies and blockchains.

Authors: Ghada Almashaqbeh* and Ravital Solomon†,

Affiliations: * University of Connecticut and † NuCypher.

3. Paper Title: Redacting Transactions from Execute-Order-Validate Blockchains.

Summary: The first design for a redactable execute-order-validate blockchain, that grants users with the right to be forgotten.

Authors: Yacov Manevich*, Artem Barger*, and Gal Assa†,

Affiliations: * IBM Haifa Research Lab and † Technion.

Scalability:

No papers.

Proofs:

1. Paper Title: Proofs of Isogeny Knowledge and Application to Post-quantum One-Time Verifiable Random Function.

Summary: A new method to prove the knowledge of an isogeny of given degree between two supersingular elliptic curves.

Authors: Antonin Leroux*,

Affiliations: * Institut Polytechnique de Paris.

2. Paper Title: VCProof: Constructing Shorter and Faster- to-Verify zkSNARKs with Vector Oracles.

Summary:

Authors: Yuncong Zhang*, Ren Zhang†‡, Geng Wang*, and Dawu Gu*,

Affiliations: * Shanghai Jiao Tong University, † Cryptape, and ‡ Shandong Institute of Blockchain.

Consensus:

1. Paper Title: Conclave: A Collective Stake Pool Protocol.

Summary: A formal design of a Collective Stake Pool, i.e., a decentralized pool with no single point of authority.

Authors: Dimitris Karakostas*‡, Aggelos Kiayias*‡, and Mario Larangeira*†,

Affiliations: * University of Edinburgh, † Tokyo Institute of Technology, and ‡ IOHK.

2. Paper Title: Multidimensional Byzantine Agreement in a Synchronous Setting.

Summary: A leaderless Byzantine agreement protocol defined for complete and synchronous networks that allows a network of nodes to reach consensus on a vector of relevant information regarding a set of observed events.

Authors: Andrea Flamini*, Riccardo Longo*, and Alessio Meneghetti*,

Affiliations: * University of Trento.

Tokenomics:

1. Paper Title: Maximizing Extractable Value from Automated Market Makers.

Summary: This work formally characterizes rational miners as players which follow an optimal strategy in the mining game.

Authors: Massimo Bartoletti*, James Hsin-yu Chiang†, and Alberto Lluch-Lafuente†.

Affiliations: * Università degli Studi di Cagliari and † Technical University of Denmark.

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This Week in Blockchain Research Issue #110

zk Capital — Wed, 26 May 2021 17:23:12 GMT

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Issue #110

Paper of the Week:

Paper Title: A Permissionless Proof-of-Stake Blockchain with Best-Possible Unpredictability (or, How to Mimic Bitcoin via Proof-of-Stake).

TLDR:
To eliminate the unnecessary waste of energy and computing power in Bitcoin, this paper develops a novel proof-of-stake consensus in the permissionless setting.
Among other features, the design achieves the “best possible” unpredictability for permissionless proof-of-stake protocols.
Predictability can be abused by the attackers for launching strengthened version of multiple attacks such as selfish-mining and bribing, against proof-of-stake systems.
This work inspired by Bitcoin’s “block-by-block” design and shows that a direct and natural mimic of Bitcoin’s design via proof-of-stake is secure if the majority 73% of stake is honest.
The result relies on an interesting upper bound of extending proof-of-stake blockchain established: players (who may extend all chains) can generate blockchain at most 2.72× faster than playing the basic strategy of extending the longest chain.
A novel strategy called “D-distance-greedy” strategy is introduced, which enables to construct a class of secure proof-of-stake blockchain protocols, against an arbitrary adversary, even assuming much smaller (than 73% of) stake is honest.
To enable a thorough security analysis in the cryptographic setting, this work develops several new techniques: for example, to show the chain growth property, it represents the chain extension process via a Markov chain, and then develops a random walk on the Markov chain; to prove the common prefix property, it introduces a new concept called “virtual chains”, and then presents a reduction from the regular version of common prefix to “common prefix w.r.t. virtual chains”.

Authors: Lei Fan*, Jonathan Katz†, Phuc Thai‡, and Hong-Sheng Zhou‡,

Affiliations: * Shanghai Jiaotong University, † University of Maryland, and ‡ Virginia Commonwealth University.

Security:

1. Paper Title: Legendre PRF (Multiple) Key Attacks and the Power of Preprocessing.

Summary: This multiple-key attack might be of interest in the Ethereum context, since recovering many keys simultaneously maximizes an attacker’s profit.

Authors: Alexander May* and Floyd Zweydinger*

Affiliations: * Ruhr University Bochum.

2. Paper Title: LEO: A Programming Language for Formally Verified, Zero-Knowledge Applications.

Summary: A statically-typed functional programming language, built with intuitive semantics that enable users to write decentralized applications the attest to the correctness of their offline compilation and execution.

Authors: Collin Chin*, Howard Wu*, Raymond Chu*, Alessandro Coglio*, Eric McCarthy*, and Eric Smith*,

Affiliations: * Aleo.

3. Paper Title: A Trustless GQ Multi-Signature Scheme with Identifiable Abort.

Summary: A trapdoor less GQ multi-signature scheme with identifiable abort property and only 4 rounds of interaction in the signing phase, secure in the dishonest majority model.

Authors: Handong Cui* and Tsz Hon Yuen*,

Affiliations: * The University of Hong Kong.

4. Paper Title: VerLoc: Verifiable Localization in Decentralized Systems.

Summary: This paper tackles an open challenge: reliably determining the geo-location of nodes in decentralized networks, considering adversarial settings and without depending on any trusted parties.

Authors: Katharina Kohls* and Claudia Diaz†,

Affiliations: * Radboud University Nijmegen and † KU Leuven.

5. Paper Title: SCSGuard: Deep Scam Detection for Ethereum Smart Contracts.

Summary: A novel deep learning scam detection framework that harnesses the automatically extractable bytecodes of smart contracts as their new features.

Authors: Huiwen Hu* and Yuedong Xu*,

Affiliations: * Fudan University.

Privacy:

No papers.

Scalability:

No papers.

Proofs:

No papers.

Consensus:

1. Paper Title: Multi-Threshold Byzantine Fault Tolerance.

Summary: A generalized version of the BFT problem, which defines fault thresholds separately for safety and liveness under synchrony and asynchrony (or partial-synchrony), respectively.

Authors: Atsuki Momose* and Ling Ren†,

Affiliations: * Nagoya University and † University of Illinois at Urbana-Champaign.

2. Paper Title: Pravuil: Global Consensus for a United World.

Summary: A robust, secure, and scalable consensus protocol for a permissionless blockchain suitable for deployment in an adversarial environment such as the Internet.

Authors: David Cerezo Sánchez*,

Affiliations: * Catalopia.

Tokenomics:

1. Paper Title: While Stability Lasts: A Stochastic Model of Stablecoins.

Summary: A new stochastic model of over-collateralized stablecoins with an endogenous price.

Authors: Ariah Klages-Mundt* and Andreea Minca*,

Affiliations: * Cornell University.

2. Paper Title: Should Central Banks Use Distributed Ledger Technology and Digital Currencies to Advance Financial Inclusion?

Summary: This paper examines how central banks might use distributed ledger technology (DLT) to improve access to safe and affordable financial products and services.

Authors: Michael S. Barr*, Adrienne A. Harris*, Lev Menand†, and Karin Thrasher*,

Affiliations: * University of Michigan and † Columbia University.

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This Week in Blockchain Research Issue #109

zk Capital — Wed, 19 May 2021 18:28:08 GMT

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Issue #109

Paper of the Week:

Paper Title: Internet Computer Consensus.

TLDR:
This work presents the Internet Computer Consensus (ICC) family of protocols for atomic broadcast (a.k.a., consensus), which underpin the Byzantine fault-tolerant replicated state machines of the Internet Computer.
The ICC protocols are leader-based protocols that assume partial synchrony, and that are fully integrated with a blockchain. The leader changes probabilistically in every round.
These protocols are extremely simple and robust: in any round where the leader is corrupt (which itself happens with probability less than 1/3), each ICC protocol will effectively allow another party to take over as leader for that round, with very little fuss, to move the protocol forward to the next round in a timely fashion.
Unlike in many other protocols, there are no complicated subprotocols (such as “view change” in PBFT) or unspecified subprotocols (such as “pacemaker” in HotStuff). Moreover, unlike in many other protocols (such as PBFT and HotStuff), the task of reliably disseminating the blocks to all parties is an integral part the protocol, and not left to some other unspecified subprotocol.
An additional property enjoyed by the ICC protocols (just like PBFT and HotStuff, and unlike others, such as Tendermint) is optimistic responsiveness, which means that when the leader is honest, the protocol will proceed at the pace of the actual network delay, rather than some upper bound on the network delay.

Authors: Jan Camenisch*, Manu Drijvers*, Timo Hanke*, Yvonne-Anne Pignolet*, Victor Shoup*, and Dominic Williams*,

Affiliations: * DFINITY Foundation.

Security:

1. Paper Title: Mining in Logarithmic Space.

Summary: A protocol which allows pruning the blockchain by garbage collecting old blocks as they become unnecessary.

Authors: Aggelos Kiayias*†, Nikos Leonardos‡, and Dionysis Zindros‡,

Affiliations: * University of Edinburgh, † IOHK, and ‡ University of Athens.

2. Paper Title: Hedging Against Sore Loser Attacks in Cross-Chain Transactions.

Summary: New distributed protocols for hedging a range of cross-chain transactions in a synchronous communication model, such as two-party swaps, 𝑛-party swaps, brokered transactions, and auctions.

Authors: Yingjie Xue* and Maurice Herlihy*,

Affiliations: * Brown University.

3. Paper Title: R-SWAP: Relay based atomic cross-chain swap protocol.

Summary: A new protocol for cross-chain swaps that outperforms existing solutions.

Authors: Leonard Lys*†, Arthur Micoulet†, and Maria Potop-Butucaru*,

Affiliations: * Sorbonne Universite and † PALO IT.

Privacy:

1. Paper Title: Tomen: Application of Bitcoin Transaction Based on Tor.

Summary: An encryption application for the communication process in the bitcoin transaction process, combined with the encryption principle method of Tor.

Authors: Yuanzhe Jin*, Ziheng Dong*, and Xing Li*,

Affiliations: * Northwestern University.

2. Paper Title: SwapCT: Swap Confidential Transactions for Privacy-Preserving Multi-Token Exchanges.

Summary: A swap confidential transaction system which is related to ring confidential transactions (e.g. used in Monero) but supports multiple token types to trade among and enables secure, partial transactions for non-interactive swaps.

Authors: Felix Engelmann*, Lukas Müller†, Andreas Peter‡, Frank Kargl†, and Christoph Bösch†,

Affiliations: * Aarhus University, † Ulm University, and ‡ University of Twente.

3. Paper Title: Bitcoin Privacy - A Survey on Mixing Techniques.

Summary: Review and evaluate mixing techniques in Bitcoin.

Authors: Simin Ghesmati*†, Walid Fdhila*, and Edgar Weippl*‡,

Affiliations: * SBA Research, † Vienna university of technology, and ‡ University of Vienna.

Scalability:

No papers.

Proofs:

1. Paper Title: Hydra: Succinct Fully Pipelineable Interactive Arguments of Knowledge.

Summary: Advancements for interactive arguments with Hydra.

Authors: William Zhang* and Yu Xia†,

Affiliations: * Ward Melville High School and † MIT CSAIL.

Consensus:

1. Paper Title: The Availability-Accountability Dilemma and its Resolution via Accountability Gadgets.

Summary: Evaluate the security of an accountable protocol in terms of its liveness resilience, the minimum number of Byzantine nodes when liveness is violated, and its accountable safety resilience, the minimum number of accountable Byzantine nodes when safety is violated.

Authors: Joachim Neu*, Ertem Nusret Tas*, and David Tse*,

Affiliations: * Stanford.

2. Paper Title: Formal Security Analysis on dBFT Protocol of NEO.

Summary: Security analysis focused on the core component of NEO.

Authors: Qin Wang*, Rujia Li†‡, Shiping Chen§, and Yang Xiang*,

Affiliations: * Swinburne University of Technology, † Southern University of Science and Technology, ‡ University of Birmingham, and § CSIRO Data61.

Tokenomics:

1. Paper Title: FairMM: A Fast and Frontrunning-Resistant Crypto Market-Maker.

Summary: A market-maker-based exchange of tokens on a smart-contract- enabled blockchain, e.g., Ethereum tokens, with built-in cryptographic defenses agains a wide class of front-running.

Authors: Michele Ciampi*, Muhammad Ishaq*, Malik Magdon-Ismail†, Rafail Ostrovsky‡, and Vassilis Zikas§,

Affiliations: * The University of Edinburgh, † Rensselaer Polytechnic Institute, ‡ University of California, Los Angeles, and § Purdue University.

2. Paper Title: Blockchains, Front-Running, and Candle Auctions.

Summary: Under a uniform ending-time distribution both the utility of the disadvantaged bidder and total revenues approach that of a second-price auction as the number of rounds grows large.

Authors: Samuel Hafner* and Alistair Stewart*,

Affiliations: * Web3 Foundation.

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This Week in Blockchain Research Issue #108

zk Capital — Wed, 12 May 2021 19:46:16 GMT

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Issue #108

Paper of the Week:

Paper Title: Securing Parallel-chain Protocols under Variable Mining Power.

TLDR:
Several emerging proof-of-work (PoW) blockchain protocols rely on a “parallel-chain” architecture for scaling, where instead of a single chain, multiple chains are run in parallel and aggregated.
A key requirement of practical PoW blockchains is to adapt to mining power variations over time (Bitcoin’s total mining power has increased by a 10^14 factor over the decade).
This paper considers the design of provably secure parallel-chain protocols which can adapt to such mining power variations.
The Bitcoin difficulty adjustment rule adjusts the difficulty target of block mining periodically to get a constant mean inter-block time.
While superficially simple, the rule has proved itself to be sophisticated and successfully secure, both in practice and in theory.
This paper shows that natural adaptations of the Bitcoin adjustment rule to the parallel-chain case open the door to subtle, but catastrophic safety and liveness breaches.
It uncovers a meta-design principle that allows to design variable mining difficulty protocols for three popular PoW blockchain proposals (Prism, OHIE, Fruitchains) inside a common rubric.

Authors: Xuechao Wang*, Viswa Virinchi Muppirala†, Lei Yang‡, Sreeram Kannan†, and Pramod Viswanath*.

Affiliations: * University of Illinois Urbana-Champaign,† University of Washington at Seattle, and ‡ MIT CSAIL.

Security:

1. Paper Title: Reentrancy Vulnerability Identification in Ethereum Smart Contracts.

Summary: A framework that combines static and dynamic analysis to detect Reentrancy vulnerabilities in Ethereum smart contracts.

Authors: Noama Fatima Samreen* and Manar H. Alalfi*,

Affiliations: * Ryerson University.

2. Paper Title: T-Cash: Transferable Fiat Backed Coins.

Summary: A transferable electronic cash scheme using blockchain technology which allows users to continuously reuse coins within the system.

Authors: Hitesh Tewari*,

Affiliations: * Trinity College Dublin.

Privacy:

1. Paper Title: Holistic Privacy and Usability of a Cryptocurrency Wallet.

Summary: The problems associated with the usability of cryptocurrency wallets, such as those used by ZCash, for end-users.

Authors: Harry Halpin*,

Affiliations: * Nym Technologies.

Scalability:

1. Paper Title: A DLT-based Smart Contract Architecture for Atomic and Scalable Trading.

Summary: A protocol that combines a hierarchical smart contract infrastructure with state channels to increase scalability of an underlying DLT system.

Authors: Jan Kalbantner*, Konstantinos Markantonakis*, Darren Hurley-Smith*, Carlton Shepherd*, and Benjamin Semal*,

Affiliations: * University of London.

Proofs:

1. Paper Title: An Algebraic Framework for Universal and Updatable SNARKs.

Summary: A new information theoretic inter- active proof system in which the prover shows that a vector has been sampled in a subspace according to the verifier’s coins.

Authors: Carla Rafols*† and Arantxa Zapico*†

Affiliations: * Pompeu Fabra University and † Cybercat.

Consensus:

1. Paper Title: Making Synchronous BFT Protocols Secure in the Presence of Mobile Sluggish Faults.

Summary: This work investigates the support for mobile sluggish faults in existing synchronous protocols such as Dfinity, Streamlet, Sync HotStuff, OptSync and the optimal latency BFT protocol.

Authors: Justin Kim*, Vandan Mehta†, Kartik Nayak‡, and Nibesh Shrestha§,

Affiliations: * Montgomery High School, † Rutgers University, ‡ Duke University, and § Rochester Institute of Technology.

Tokenomics:

1. Paper Title: Cyclic Arbitrage in Decentralized Exchange Markets.

Summary: Cyclic arbitrages in Decentralized Exchanges (DEXes) of cryptocurrencies with transaction-level data on Uniswap V2, observing 285,127 cyclic arbitrages over eight months.

Authors: Ye Wang*, Yan Chen†, Shuiguang Deng†, and Roger Wattenhofer*,

Affiliations: * ETH Zurich and † Zhejiang University.

2. Paper Title: Lightning Network Economics: Channels.

Summary: This paper (i) identifies conditions for two parties to optimally establish a channel, (ii) finds explicit formulas for channel costs, (iii) obtains the optimal collaterals and savings entailed, and (iv) derives the implied reduction in congestion of the blockchain.

Authors: Paolo Guasoni*, Gur Huberman†, and Clara Shikhelman‡,

Affiliations: * Dublin City University, † Columbia Business School, and ‡ Chaincode Labs.

3. Paper Title: An economic theory of blockchain foundations.

Summary: The treasury foundations manage is a moat to raise the cost of exit or forking because the benefit of the fund is only available to those who stay with the chain.

Authors: Darcy Allen*, Chris Berg*, Sinclair Davidson*, Trent MacDonald*, and Jason Potts*

Affiliations: * RMIT University.

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This Week in Blockchain Research Issue #107

zk Capital — Wed, 05 May 2021 19:45:38 GMT

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Issue #107

Paper of the Week:

Paper Title: Targeting the Weakest Link: Social Engineering Attacks in Ethereum Smart Contracts.

TLDR:
This work explores the possibility and existence of new social engineering attacks beyond smart contract honeypots.
It presents two novel classes of Ethereum social engineering attacks — Address Manipulation and Homograph — and develops six zero-day social engineering attacks.
To show how the attacks can be used in popular programming patterns, it conducts a case study of five popular smart contracts with combined market capitalization exceeding $29 billion, and integrates the attack patterns in their source codes without altering their existing functionality.
Moreover, it shows that these attacks remain dormant during the test phase but activates their malicious logic only at the final production deployment.
The work further analyzes 85,656 open-source smart contracts, and discovers that 1,027 of them can be used for the proposed social engineering attacks.
It conducts a professional opinion survey with experts from seven smart contract auditing firms, corroborating that the exposed social engineering attacks bring a major threat to the smart contract systems.

Authors: Nikolay Ivanov*, Jianzhi Lou*, Ting Chen†, Jin Li†, and Qiben Yan*,

Affiliations: * Michigan State University and † Guangzhou University.

Security:

1. Paper Title: Forward-secure Multi-user Aggregate Signatures with Constant Complexities using Recursive zk-SNARKs.

Summary: A forward secure aggregate signature scheme utilizing recursive zk-SNARKs, whose all metrics including size and time have O(1).

Authors: Jeonghyuk Lee*, Jihye Kim†, and Hyunok Oh*

Affiliations: * Hanyang University and † Kookmin University.

2. Paper Title: Accountable Fine-grained Blockchain Rewriting in the Permissionless Setting.

Summary: A new framework of accountable fine-grained blockchain rewriting that requires no trust assumptions.

Authors: Yangguang Tian, Bowen Liu, Yingjiu Li, Pawel Szalachowski, and Jianying Zhou,

Affiliations: * Osaka University, † Singapore University of Technology and Design, and ‡ University of Oregon.

Privacy:

1. Paper Title: ReTRACe: Revocable and Traceable Blockchain Rewrites using Attribute-based Cryptosystems.

Summary: A blockchain transaction rewriting framework building on a novel revocable chameleon hash with ephemeral trapdoor scheme and a novel revocable CP-ABE scheme.

Authors: Gaurav Panwar*, Roopa Vishwanathan*, and Satyajayant Misra*,

Affiliations: * New Mexico State University.

Scalability:

No papers.

Proofs:

1. Paper Title: ethSTARK Documentation – Version 1.1.

Summary: This document is intended to accompany the ethSTARK codebase, describing the computational integrity statement proved by that code and the specific STARK construction used to prove the statement.

Authors: StarkWare Team*,

Affiliations: * StarkWare.

Consensus:

No papers.

Tokenomics:

1. Paper Title: DeFiRanger: Detecting Price Manipulation Attacks on DeFi Applications.

Summary: Detection of two types of new attacks on DeFi apps, including direct and indirect price manipulation attacks.

Authors: Siwei Wu*, Dabao Wang*, Jianting He*, Yajin Zhou*, Lei Wu*, Xingliang Yuan†, Qinming He*, and Kui Ren*,

Affiliations: * Zhejiang University and † Monash University.

2. Paper Title: Soft Power: Upgrading Chain Macroeconomic Policy Through Soft Forks.

Summary: The proposed mechanism works in today’s Ethereum blockchain without any changes and can support a very generic class of monetary policies that satisfy a few basic bounds.

Authors: Dionysis Zindros*,

Affiliations: * University of Athens.

3. Paper Title: Sovereign digital currencies: Reshaping the design of money and payments systems.

Summary: This work considers the policy issues and choices associated with cryptocurrencies, stablecoins and sovereign digital currencies and emphasises that there is no single model for sovereign digital currency design.

Authors: Ross P. Buckley*, Douglas W. Arner†, Dirk A. Zetzsche‡, Anton N. Didenko,* and Lucien J. van Romburg†,

Affiliations: * University of New South Wales, † The University of Hong Kong, and ‡ Universite du Luxembourg.

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This Week in Blockchain Research Issue #106

zk Capital — Wed, 28 Apr 2021 17:08:34 GMT

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Issue #106

Paper of the Week:

Paper Title: SnarkPack: Practical SNARK Aggregation.

TLDR:
This work presents and implements an argument for aggregating n Groth16 zkSNARKs with a O(log n) proof size and verifier time.
The techniques are inspired from the inner pairing product argument introduced by Bünz et al. with the difference that the final scheme does not require a different trusted setup, but it reuses the one from the pairing-based SNARK that it aggregates.
The key tool for the proposed construction is a new commitment scheme that allows to instantiate the inner product pairing argument of Bünz et al. by using existing powers of tau ceremony transcripts.
The work also describes a scheme that merges together a multi-exponentiation argument and an inner pairing product argument for some common randomness vector with minimal overhead.
Then it applies some optimisations to the protocol and illustrates it’s efficiency by implementing it.
SnarkPack can aggregate 1024 proofs in 2s and verify them in 33ms, including un-serialization time, yielding a verification mechanism that is exponentially faster than batching.

Authors: Nicolas Gailly*, Mary Maller†, and Anca Nitulescu*

Affiliations: * Protocol Labs and † Ethereum Fondation.

Security:

1. Paper Title: Vulnerabilities and Open Issues of Smart Contracts: A Systematic Mapping.

Summary: This paper conducts a systematic literature mapping identifying initiatives and tools to analyze SCs and how to deal with the identified vulnerabilities.

Authors: Gabriel de Sousa Matsumura*, Luciana Brasil Rebelo dos Santos*, Arlindo Flavio da Conceicao†, and Nandamudi Lankalapalli Vijaykumar†,

Affiliations: * Federal Institute of Education, Science and Technology of Sao Paulo and † Federal University of Sao Paulo.

2. Paper Title: SoK: Exploring Blockchains Interoperability.

Summary: This paper presents a Systematization of Knowledge for the existing efforts on blockchains interoperability.

Authors: Gang Wang*,

Affiliations: * University of Connecticut.

Privacy:

1. Paper Title: MatRiCT+: More Efficient Post-Quantum Private Blockchain Payments.

Summary: A practical RingCT protocol based on post-quantum lattice assumptions.

Authors: Muhammed F. Esgin*†, Ron Steinfeld*, and Raymond K. Zhao*,

Affiliations: * Monash University and † CSIRO’s Data61.

Scalability:

No papers.

Proofs:

1. Paper Title: On Simulation-Extractability of Universal zkSNARKs.

Summary: A class of computationally special-sound interactive proofs of knowledge that are zero- knowledge in the standard model and have a unique response property are simulation-extractable out-of- the box in the Random Oracle model when the Fiat–Shamir transformation is applied to them.

Authors: Markulf Kohlweiss*† and Michał Zając‡

Affiliations: * University of Edinburgh, † IOHK, and ‡ Clearmatics.

2. Paper Title: Non-Interactive Zero Knowledge from Sub-exponential DDH.

Summary: The first constructions of non-interactive zero-knowledge and Zap arguments for NP based on the sub-exponential hardness of Decisional Diffie-Hellman against polynomial time adversaries (without use of groups with pairings).

Authors: Abhishek Jain* and Zhengzhong Jin*,

Affiliations: * Johns Hopkins University.

Consensus:

No papers.

Tokenomics:

1. Paper Title: Decentralized Finance: Regulating Cryptocurrency Exchanges.

Summary: This Article proposes that regulators introduce formal registration obligations for cryptocurrency intermediaries —the exchange platforms that provide a marketplace for secondary market trading.

Authors: Kristin N. Johnson*,

Affiliations: * Emory University.

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This Week in Blockchain Research Issue #105

zk Capital — Wed, 21 Apr 2021 18:39:56 GMT

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Issue #105

Paper of the Week:

Paper Title: Virtual Art and Non-fungible Tokens.

TLDR:
During early 2021 reports emerged of newfound excitement in the art world as a landmark sale of digital art for $ 69 million takes place.
Fueled in part by the wealth recently created from digital currencies, major art dealers such as Christie’s and Sotheby’s embrace this new development.
What then are nonfungible tokens, how is this related to the blockchain and what do we know about this ancient market for digital art?
It now appears that digital art can be added to the growing list of uses for blockchain technology now becoming a part of modern life.
This article first discusses the new and explosive market for digital art and it explores the evolution of the digital world and virtual property.
It explores nonfungible tokens and presents a few thoughts about the future of digital property.
This dramatic extention of blockchain and other digital technology to the world of art and music represents a new and exciting platform for creative expression.

Authors: Lawrence J. Trautman*,

Affiliations: * Prairie View A&M University.

Security:

1. Paper Title: TSGN: Transaction Subgraph Networks for Identifying Ethereum Phishing Accounts.

Summary: A novel transaction subgraph network (TSGN) model for phishing account identification.

Authors: Jinhuan Wang*, Pengtao Chen*, Shanqing Yu*, and Qi Xuan*†,

Affiliations: * Zhejiang University of Technology and † Peng Cheng Laboratory.

2. Paper Title: SAILFISH: Vetting Smart Contract State-Inconsistency Bugs in Seconds.

Summary: A scalable system for automatically finding state-inconsistency bugs in smart contracts.

Authors: Priyanka Bose, Dipanjan Das, Yanju Chen, Yu Feng, Christopher Kruegel, and Giovanni Vigna*,

Affiliations: * UC Santa Barbara.

3. Paper Title: Ponzi Scheme Detection in Ethereum Transaction Network.

Summary: This work collects transaction records from Ethereum and detects Ponzi schemes from a network perspective.

Authors: Shanqing Yu*, Jie Jin*, Yunyi Xie*, Jie Shen*, and Qi Xuan*†,

Affiliations: * Zhejiang University of Technology and † Peng Cheng Laboratory.

4. Paper Title: A Tractable Probabilistic Approach to Analyze Sybil Attacks in Sharding-Based Blockchain Protocols.

Summary: A probabilistic approach to analyze the security of sharding-based blockchain protocols.

Authors: Abdelatif Hafid*, Abdelhakim Senhaji Hafid*, and Mustapha Samih*,

Affiliations: * University of Montreal and † University of Moulay Ismail.

Privacy:

1. Paper Title: zkHawk: Practical Private Smart Contracts from MPC-based Hawk.

Summary: The protocol presented above facilitates Interactive Private Smart Contracts (I-PSC) wherein an Interactive protocol (MPC) between the parties is executed replacing the manager in Hawk in order to determine the outcome of the smart contract and reach consensus on the payout distribution.

Authors: Aritra Banerjee*, Michael Clear*, and Hitesh Tewari*,

Affiliations: * Trinity College Dublin.

2. Paper Title: Private Liquidity Matching using MPC.

Summary: A privacy preserving netting protocol to solve the gridlock resolution problem in Real Time Gross Settlement systems.

Authors: Shahla Atapoor*, Nigel P. Smart*†, and Younes Talibi Alaoui*,

Affiliations: * KU Leuven and † University of Bristol.

3. Paper Title: Bitcoin Address Clustering Method Based on Multiple Heuristic Conditions.

Summary: This work analyzes the associations between Bitcoin transactions and addresses to cluster address and further find groups of addresses controlled by the same entity.

Authors: He Xi*, He Ketai*, Lin Shenwen†, Yang Jinglin†, and Mao Hongliang†

Affiliations: * University of Science and Technology Beijing and † CNCERT/CC.

Scalability:

No papers.

Proofs:

1. Paper Title: TurboIKOS: Improved Non-interactive Zero Knowledge and Post-Quantum Signatures.

Summary: A zero knowledge argument for general arithmetic circuits that is public-coin and constant rounds, so it can be made non-interactive and publicly verifiable with the Fiat-Shamir heuristic.

Authors: Yaron Gvili*, Julie Ha†, Sarah Scheffler†, Mayank Varia†, Ziling Yang†, and Xinyuan Zhang‡,

Affiliations: * Cryptomnium LLC, † Boston University, and ‡ George Mason University.

Consensus:

1. Paper Title: Modeling and control of decision-making of miners in blockchain.

Summary: A dynamical model of the decision-making of miners in the blockchain.

Authors: Kosuke Toda*, Naomi Kuze*, and Toshimitsu Ushio*

Affiliations: * Osaka University.

Tokenomics:

1. Paper Title: Non-Fungible Tokens: Blockchains, Scarcity, and Value.

Summary: How valuable is an NFT in reality? It is as valuable as people express a willingness to pay for it.

Authors: Usman W. Chohan*,

Affiliations: * UNSW Business School.

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This Week in Blockchain Research Issue #104

zk Capital — Wed, 14 Apr 2021 16:55:19 GMT

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Issue #104

Paper of the Week:

Paper Title: Tokenized: The Law of Non-Fungible Tokens and Unique Digital Property.

TLDR:
Markets for unique digital property—digital equivalents of rare artworks, collectible trading cards, and other assets that gain value from scarcity—have exploded in the past several months.
At root is the next iteration of blockchain technology, unique digital assets called non-fungible tokens.
NFTs have grown from a few early breakout successes to a rapidly developing market for unique digital treasures. The attraction to buyers is that unlike digital assets like e-books or licensed movies, NFTs can be bought, sold, displayed, gifted, or even destroyed just like personal property.
Yet law has not kept pace with demand for unique digital property. In particular, the rules designed for the 2000s internet focused on expanding intellectual property licenses and online contracts to the point that we are mere users, not owners, of digital assets.
This article proposes a clear path for the evolution of the legal underpinnings of NFTs. It argues that NFTs are personal property, not contracts (despite the “smart contracts” popular nomenclature) or pure intellectual property licenses (despite the currently governing law of digital assets like e-books).
Because transactions in NFTs are in the form of a sale, the law of sales of personal property should apply.
And finally, the article notes that NFTs will serve as a powerful grounding example of digital personal property, a legal form of ownership that is both sorely needed and has not yet been clearly established online.
That example will ground others, and permit law to again characterize those who buy scarce and valuable digital assets as true owners rather than mere users.

Authors: Joshua Fairfield*

Affiliations: * Washington and Lee University.

Security:

1. Paper Title: EtherClue: Digital investigation of attacks on Ethereum smart contracts.

Summary: Indicators of Compromise (IoCs) defined over the side-effects of Ethereum smart contract execution is an effective way to identify exploit transactions.

Authors: Simon Joseph Aquilina*, Fran Casino†‡, Mark Vella*, Joshua Ellul*, and Constantinos Patsakis†‡,

Affiliations: * University of Malta and † University of Piraeus, and ‡ Athena Research Center.

1. Paper Title: Ethereum Name Service: the Good, the Bad, and the Ugly.

Summary: Several security issues and misbehaviors including traditional DNS security issues and new issues introduced by ENS smart contracts.

Authors: Pengcheng Xia*, Haoyu Wang*, Zhou Yu*, Xinyu Liu*, Xiapu Luo†, and Guoai Xu*,

Affiliations: * Beijing University of Posts and Telecommunications and † The Hong Kong Polytechnic University.

Privacy:

1. Paper Title: LightPIR: Privacy-Preserving Route Discovery for Payment Channel Networks.

Summary: An approach which allows a source to efficiently discover a shortest path to its destination without revealing any information about the endpoints of the transaction.

Authors: Krzysztof Pietrzak*, Iosif Salem†, Stefan Schmid*† , Michelle Yeo*,

Affiliations: * IST Austria and † University of Vienna.

Scalability:

1. Paper Title: RandChain: Practical Scalable Decentralized Randomness Attested by Blockchain.

Summary: A decentralized random beacon protocol designed to provide continuous randomness at regular intervals and provides guaranteed output delivery.

Authors: Gang Wang* and Mark Nixon†

Affiliations: * University of Connecticut and † Emerson Automation Solutions.

2. Paper Title: RepShard: Reputation-based Sharding Scheme Achieves Linearly Scaling Efficiency and Security Simultaneously.

Summary: This work adopts a two-layer hierarchical chain structure, consisting of a reputation chain and independent transaction chains.

Authors: Gang Wang*

Affiliations: * University of Connecticut.

Proofs:

No papers.

Consensus:

No papers.

Tokenomics:

Check out paper of the week.

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This Week in Blockchain Research Issue #103

zk Capital — Wed, 07 Apr 2021 17:02:33 GMT

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Issue #103

Paper of the Week:

Paper Title: Pooling is not Favorable: Decentralize Mining Power of PoW Blockchain Using Age-of-Work.

TLDR:
If the aggregated computing power of the PoW pools form a substantial portion of the total computing power in the network, the pooled mining undermines the core spirit of blockchain, i.e., the decentralization, and harms its security.
To discourage the pooled mining, this work develops a new consensus protocol called Proof-of-Age (PoA) that builds upon the native PoW protocol.
The core idea of PoA lies in using Age-of-Work (AoW) to measure the effective mining period that the miner has devoted to maintaining the security of blockchain.
Unlike in the native PoW protocol, in PoA protocol, miners benefit from its effective mining period even if they have not successfully mined a block.
First a continuous time Markov chain (CTMC) is employed to model the block generation process of the PoA based blockchain.
Based on this CTMC model, block generation rates of the mining pool and solo miner are analyzed respectively.
The analytical results verify that under PoA, the block generation rates of miners in the mining pool are reduced compared to that of solo miners, thereby disincentivizing the pooled mining.
The mining process in the PoA blockchain is simulated to demonstrate the consistency of the analytical results.

Authors: Long Shi*, Taotao Wang†, Jun Li*, and Shengli Zhang†,

Affiliations: * Nanjing University of Science and Technology and † Shenzhen University.

Security:

No papers.

Privacy:

1. Paper Title: A Formal Analysis of the MimbleWimble Cryptocurrency Protocol.

Summary: An idealized model that is key in the verification process, and identify and precisely state sufficient conditions for the presented model to ensure the verification of relevant security properties of MW.

Authors: Adrián Silveira*, Gustavo Betarte*, Maximiliano Cristiá†, and Carlos Luna*,

Affiliations: * Universidad de la República and † Universidad Nacional de Rosario.

Scalability:

No papers.

Proofs:

1. Paper Title: Formal security analysis of MPC-in-the-head zero-knowledge protocols.

Summary: The first machine-checked security proof of a zero-knowledge protocol following the MPC-in-the-head paradigm.

Authors: Nikolaj Sidorenco*, Sabine Oechsner*, and Bas Spitters*†,

Affiliations: * Aarhus University and † Concordium Blockchain Research Center.

2. Paper Title: Generic Plaintext Equality and Inequality Proofs (Extended Version).

Summary: Generic protocols that can be instantiated with different encryption schemes.

Authors: Olivier Blazy*, Xavier Bultel†, Pascal Lafourcade‡ and Octavio Perez Kempner§✜,

Affiliations: * Universite de Limoges, † INSA Centre Val de Loire, ‡ University Clermont Auvergne, § École normale supérieure, and ✜ be-ys Research.

3. Paper Title: Stacking Sigmas: A Framework to Compose Σ-Protocols for Disjunctions.

Summary: Can we design a generic compiler that stacks any Σ-protocol without modification?

Authors: Aarushi Goel*, Matthew Green*, Mathias Hall-Andersen†, and Gabriel Kaptchuk‡,

Affiliations: * Johns Hopkins University, † Aarhus University, and ‡ Boston University.

Consensus:

No papers.

Tokenomics:

1. Paper Title: Is Non-fungible Token Pricing Driven by Cryptocurrencies?

Summary: Cryptocurrency pricing behaviours might be of some benefit in understanding NFT pricing patterns. However, the low volatility transmissions also indicate that NFTs can potentially be considered as a low-correlation asset class distinct from cryptocurrencies.

Authors: Michael M. Dowling*,

Affiliations: * Dublin City University Business School.

2. Paper Title: Blockchain Initiatives for Tax Administration.

Summary: This Article extends the study of blockchain to tax administration, evaluates the feasibility of incorporating blockchain within existing tax administrations, and provides policymakers with criteria to consider and some recommended designs for blockchain.

Authors: Young Ran (Christine) Kim*

Affiliations: * University of Utah.

3. Paper Title: Rent Seeking in BlockchainGovernance: The Awkward Transition From Market Decision Making to Non-market Decision Making.

Summary: This paper considers how to assess rentseeking in the context of blockchain governance.

Authors: Chris Berg*,

Affiliations: * RMIT University.

4. Paper Title: Decentralized Finance (DeFi): An Emergent Alternative Financial Architecture.

Summary: DeFi is mired in considerable difficulties including market manipulation, distortionary incentives, excess short-termism, Ponzi-schemes, and money-laundering challenges that also foment a considerable level of dissuasion against its wider adoption.

Authors: Usman W. Chohan*,

Affiliations: * UNSW Business School.

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