Blockchain-Based Automated Market Makers for a Decentralized Stock Exchange

Abstract

The advancements in communication speeds have enabled the centralized financial market to be faster and more complex than ever. The speed of the order execution has become exponentially faster when compared to the early days of electronic markets. Though the transaction speed has increased, the underlying architecture or models behind the markets have remained the same. These models come with their own disadvantages. The disadvantages are usually faced by non-institutional or small traders. The bigger players, such as financial institutions, have an advantage over smaller players because of factors such as information asymmetry and access to better infrastructure, which give them an advantage in terms of the speed of execution. This makes the centralized stock market an uneven playing field. This paper discusses the limitations of centralized financial markets, particularly the disadvantage faced by non-institutional or small traders due to information asymmetry and better infrastructure access by financial institutions. The authors propose the usage of blockchain technology and the data highway protocol to create a decentralized stock exchange that can potentially eliminate these disadvantages. The data highway protocol is used to generate new blocks with a flexible finality condition that allows for the consensus mechanism to configure security thresholds more freely. The proposed framework is compared with existing frameworks to confirm its effectiveness and identify areas that require improvement. The evaluation of the proposed approach showed that the improved highway protocol boosted the transaction rate compared to the other two mechanisms (PoS and PoW). Specifically, the transaction rate of the proposed model was found to be 2.2 times higher than that of PoS and 12 times higher than that of the PoW consensus model.

Enhancing Cloud Communication Security: A Blockchain-Powered Framework with Attribute-Aware Encryption

“…This paper compares functionally with attribute-based encryption schemes [17][18][19] in recent years. The access control strategy mainly includes two kinds of access trees and a linear secret sharing scheme.…”

“…In addition, Table 1 shows that the proposed method has certain advantages in functional characteristics. [17,20,21].…”

“…The numerical simulation is implemented in C using a 2.9GHz CPU and 4GB of RAM on a Linux computer using the bilinear pairing package (pairing-based cryptography library) [19]. Figure 2 Figure 2 demonstrates the proposed algorithm's time cost compared to the existing algorithm presented in the literature [17]. In the results of key generation, trapdoor generation, and search stages, the proposed system's efficiency is greater than the existing work's.…”

“…In the results of key generation, trapdoor generation, and search stages, the proposed system's efficiency is greater than the existing work's. Table 5 illustrates how the proposed technique performs more effectively than previous methods specified in paper [17] regarding the key generation and trapdoor generation stages. Figure 2 demonstrates the proposed algorithm's time cost compared to the existing algorithm presented in the literature [17].…”

“…Table 5 illustrates how the proposed technique performs more effectively than previous methods specified in paper [17] regarding the key generation and trapdoor generation stages. Figure 2 demonstrates the proposed algorithm's time cost compared to the existing algorithm presented in the literature [17]. In the results of key generation, trapdoor generation, and search stages, the proposed system's efficiency is greater than the existing work's.…”