Blockchain-Based Payment Channel Networks: Challenges and Recent Advances

Papadis, Nikolaos

doi:10.1109/access.2020.3046020

Cited by 37 publications

(16 citation statements)

References 33 publications

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“…Finally if q 1 returns an error and q 2 locks in we will have to enter the third round. In the third round there is only 1 sat to be delivered on a single possible path q 2 which, given our knowledge, has a success probability of 8 9 • 5 6 • 2 3 = 0.494 . .…”

Section: Examplementioning

confidence: 92%

“…This example shows that finding a min-cost flow cannot in general be done by computing the most likely path for a single sat and extending it with the next most likely 1-sat-paths. 8 Extending our example and assuming we want to send a total of 3 sat we start again by computing the mincost flow f 3 which can be disected into two paths l 1 = s, X, Y, d with an amount of 1 and another path l 2 = s, A, B, d with an amount of 2. After sending out the onions we might have learned that the onion along l 1 has been successful, but the one with 2 sat along l 2 has failed because B did not have enough liquidity to forward the onion to d on the (B, d) channel.…”

Section: Examplementioning

confidence: 99%

“…For the second phase of the algorithm we now compute the min-cost flow on a graph where we know that we can deliver 2 sat with perfect certainty to B. This updated uncertainty network is depicted in Figure 3 The flow that sends the full residual amount of 2 sat along s, A, B, X, Y, d has a probability of 8 10 • 5 7 • 1 2 = 0.286... while the flow that sends 1 sat along the B, d channel has a probability of 1 2 • 9 10 • 6 7 • 3 4 = 0.289... telling us that for the residual amount we should make another split payment sending one sat along each of the paths q 1 = s, A, B, d and q 2 = s, A, B, X, Y, d.…”

Section: Examplementioning

confidence: 99%

“…It is well-known in the community that routing nodes can contribute to the overall payment reliability in the Lightning Network by using various channel rebalancing techniques. A recent survey paper [8] in particular describes channel rebalancing via off-chain circular onions. This can happen proactively or lazily at routing time via a technique called just in time routing (JIT-routing) [9].…”

Section: Optimal Channel Rebalancingmentioning

confidence: 99%

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Optimally Reliable & Cheap Payment Flows on the Lightning Network

Pickhardt,

Richter

2021

Preprint

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Today, payment paths in Bitcoin's Lightning Network are found by searching for shortest paths on the fee graph. We enhance this approach in two dimensions. Firstly, we take into account the probability of a payment actually being possible due to the unknown balance distributions in the channels. Secondly, we use minimum cost flows as a proper generalization of shortest paths to multi-part payments (MPP).In particular we show that under plausible assumptions about the balance distributions we can find the most likely MPP for any given set of senders, recipients and amounts by solving for a (generalized) integer minimum cost flow with a separable and convex cost function. Polynomial time exact algorithms as well as approximations are known for this optimization problem.We present a round-based algorithm of min-cost flow computations for delivering large payment amounts over the Lightning Network. This algorithm works by updating the probability distributions with the information gained from both successful and unsuccessful paths on prior rounds. In all our experiments a single digit number of rounds sufficed to deliver payments of sizes that were close to the total local balance of the sender. Early experiments indicate that our approach increases the size of payments that can be reliably delivered by several orders of magnitude compared to the current state of the art.We observe that finding the cheapest multi-part payments is an NP-hard problem considering the current fee structure and propose dropping the base fee to make it a linear min-cost flow problem. Finally, we discuss possibilities for maximizing the probability while at the same time minimizing the fees of a flow. While this turns out to be a hard problem in general as well -even in the single path case -it appears to be surprisingly tractable in practice.

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Section: Examplementioning

confidence: 92%

Section: Examplementioning

confidence: 99%

Section: Examplementioning

confidence: 99%

Section: Optimal Channel Rebalancingmentioning

confidence: 99%

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Optimally Reliable & Cheap Payment Flows on the Lightning Network

Pickhardt,

Richter

2021

Preprint

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“…Fabrikant et al [1] studied the process of building these networks from a game-theoretic perspective by modeling it as a network creation game. This game is widely applied in various areas and has recently been used as the technique to study payment channel networks on the blockchain [4,5,6,7].…”

Section: Introductionmentioning

confidence: 99%

On Tree Equilibria in Max-Distance Network Creation Games

Wang

2021

Preprint

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We study the Nash equilibrium and the price of anarchy in the max-distance network creation game. The network creation game, first introduced and studied by Fabrikant et al.[1], is a classic model for real-world networks from a game-theoretic point of view. In a network creation game with n selfish vertex agents, each vertex can build undirected edges incident to a subset of the other vertices. The goal of every agent is to minimize its creation cost plus its usage cost, where the creation cost is the unit edge cost α times the number of edges it builds, and the usage cost is the sum of distances to all other agents in the resulting network. The max-distance network creation game, introduced and studied by Demaine et al. [2], is a key variant of the original game, where the usage cost takes into account the maximum distance instead. The main result of this paper shows that for α ≥ 23 all equilibrium graphs in the max-distance network creation game must be trees, while the best bound in previous work is α > 129 [3]. We also improve the constant upper bound on the price of anarchy to 3 for tree equilibria. Our work brings new insights into the structure of Nash equilibria and takes one step forward in settling the so-called tree conjecture in the max-distance network creation game.

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Coupling of cryptocurrency trading with the sustainable environmental goals: Is it on the cards?

2021

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Following the systematic review and bibliometric analysis of current literature, this paper attempts to investigate whether the wealth generated through cryptocurrency trading can assist in attaining the United Nations' (UN) sustainable development goal (SDG) 7, affordable and clean energy and UN SDG 13 related to climate action. The critical analysis of literature indicates a growing interest in cryptocurrency, the UN's

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Blockchain-Based Payment Channel Networks: Challenges and Recent Advances

Cited by 37 publications

References 33 publications

Optimally Reliable & Cheap Payment Flows on the Lightning Network

Optimally Reliable & Cheap Payment Flows on the Lightning Network

On Tree Equilibria in Max-Distance Network Creation Games

Coupling of cryptocurrency trading with the sustainable environmental goals: Is it on the cards?

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