Discharged Payment Channels: Quantifying the Lightning Network's Resilience to Topology-Based Attacks

Rohrer, Elias; Malliaris, Julian; Tschorsch, Florian

doi:10.48550/arxiv.1904.10253

Cited by 8 publications

(15 citation statements)

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“…There are several interesting studies on the topology of transaction networks. In particular, Rohrer et al [85] study the resilience of the Lightning network to topologybased attacks, and in particular, to isolation attacks. The authors argue that the Lightning network can be classified as a small-world and scale free network and show that in order to perform a resource-limited attack, the attacker should employ a highest ranked minimum cut strategy.…”

Section: State Of the Artmentioning

confidence: 99%

Survey on Cryptocurrency Networking: Context, State-of-the-Art, Challenges

Dotan,

Pignolet,

Schmid

et al. 2020

Preprint

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Cryptocurrencies such as Bitcoin are realized using distributed systems and hence critically rely on the performance and security of the interconnecting network. The requirements on these networks and their usage, however can differ significantly from traditional communication networks, with implications on all layers of the protocol stack. This paper is motivated by these differences, and in particular by the observation that many fundamental design aspects of these networks are not well-understood today. In order to support the networking community to contribute to this emerging application domain, we present a structured overview of the field, from topology and neighbor discovery to block and transaction propagation. In particular, we provide the context, highlighting differences and commonalities with traditional networks, review the state-of-the-art, and identify open research challenges. Our paper can hence also be seen as a call-to-arms to improve the foundation on top of which cryptocurrencies are built.

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Section: State Of the Artmentioning

confidence: 99%

Survey on Cryptocurrency Networking: Context, State-of-the-Art, Challenges

Dotan,

Pignolet,

Schmid

et al. 2020

Preprint

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Section: Related Workmentioning

confidence: 99%

“…After the launch of LN, several studies have investigated the graph properties of LN [32,31,22]. They described the topology of LN at an arbitrarily chosen point in time and found that LN exhibits a hub and spoke topology, and its degree distribution can be well approximated with a scale-free distribution [32,31]. Furthermore, these works assessed the robustness of the network against various types of attack strategies: they showed that LN is susceptible to both node [32,22] and channel [31] removal based attacks.…”

Section: Related Workmentioning

confidence: 99%

“…First, we gathered an edge stream data that describes every payment channel opening and closure from block height 501,337 (in December 28, 2017) to 576,140 (in May 15, 2019). Second, we collected snapshots of the public graph using the lnd client and utilized snapshots taken by Rohrer et al [31] as well. We highlight that only the latter dataset contains transaction fee information.…”

Section: Datamentioning

confidence: 99%

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A Cryptoeconomic Traffic Analysis of Bitcoin's Lightning Network

Béres¹,

Seres²,

Benczúr³

2019

Preprint

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Lightning Network (LN) is designed to amend the scalability and privacy issues of Bitcoin. It is a payment channel network where Bitcoin transactions are issued off the blockchain and onion routed through a private payment path with the aim to settle transactions in a faster, cheaper, and more private manner, as they are not recorded in a costly-to-maintain, slow, and public ledger. In this work, we design a traffic simulator to empirically study LN's transaction fees and privacy provisions. The simulator relies only on publicly available data of the network structure and capacities, and generates transactions under assumptions that we attempt to validate based on information spread by certain blog posts of LN node owners.Our findings on the estimated revenue from transaction fees are in line with the widespread opinion that participation is economically irrational for the majority of the large routing nodes who currently hold the network together. Either traffic or transaction fees must increase by orders of magnitude to make payment routing economically viable. We give worst-case estimates for the potential fee increase by assuming strong price competition among the routers. We also estimate how current channel structures and pricing policies respond to a potential increase in traffic, how reduction in locked funds on channels would affect the network, and show examples of nodes who are estimated to operate with economically feasible revenue.Our second set of findings considers privacy. Even if transactions are onion routed, strong statistical evidence on payment source and destination can be inferred, as many transaction paths only consist of a single intermediary by the side effect of LN's small-world nature. Based on our simulation experiments, we (1) quantitatively characterize the privacy shortcomings of current LN operation, and (2) propose a method to inject additional hops in routing paths to demonstrate how privacy can be strengthened with very little additional transactional cost.

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“…The BLN has recently raised a lot of interest: Lee et al 1 showed that the BLN is characterised by a scale-free topology; Lin et al 2 and Martinazzi et al 3 analysed the evolution of the BLN topology and found it to have become increasingly centralised at different levels; Seres et al 4 argued that the BLN structure can be ameliorated to improve its security; the authors of 5 and 6 showed that the current BLN can be prone to channel exhaustion or attacks aimed at isolating nodes, thus compromising their reachability, the payment success ratio, etc. Mizrahi et al 7 analysed the robustness of the BLN against three different types of attacks: locking channels, disconnecting pairs of nodes and isolating hubs; although their results indicate that the BLN can be disrupted at a relatively low cost, Conoscenti et al 8 suggested that the BLN is still resilient against the removal of nodes that do not have a significant influence on the probability of success of a payment.…”

Section: Introductionmentioning

confidence: 99%

The Weighted Bitcoin Lightning Network

Lin¹,

Marchese²,

Tessone³

et al. 2021

Preprint

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The Bitcoin Lightning Network (BLN) was launched in 2018 to scale up the number of transactions between Bitcoin owners. Although several contributions concerning the analysis of the BLN binary structure have recently appeared in the literature, the properties of its weighted counterpart are still largely unknown. The present contribution aims at filling this gap, by considering the Bitcoin Lightning Network over a period of 18 months, ranging from 12 th January 2018 to 17 th July 2019, and focusing on its weighted, undirected, daily snapshot representation. As the study of the BLN weighted structural properties reveals, it is becoming increasingly 'centralised' at different levels, just as its binary counterpart: 1) the Nakamoto coefficient shows that the percentage of nodes whose degrees/strengths 'enclose' the 51% of the total number of links/total weight is rapidly decreasing; 2) the Gini coefficient confirms that several weighted centrality measures are becoming increasingly unevenly distributed; 3) the weighted BLN topology is becoming increasingly compatible with a core-periphery structure, with the largest nodes 'by strength' constituting the core of such a network, whose size keeps shrinking as the BLN evolves. Further inspection of the resilience of the weighted BLN shows that removing such hubs leads to the network fragmentation into many components, an evidence indicating potential security threats -as the ones represented by the so called 'split attacks'.

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Discharged Payment Channels: Quantifying the Lightning Network's Resilience to Topology-Based Attacks

Cited by 8 publications

References 0 publications

Survey on Cryptocurrency Networking: Context, State-of-the-Art, Challenges

Survey on Cryptocurrency Networking: Context, State-of-the-Art, Challenges

A Cryptoeconomic Traffic Analysis of Bitcoin's Lightning Network

The Weighted Bitcoin Lightning Network

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