Research and Challenges on Bitcoin Anonymity

Herrera-Joancomartí, Jordi

doi:10.1007/978-3-319-17016-9_1

Cited by 84 publications

(50 citation statements)

References 16 publications

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“…Similar to our mapping study, Herrera-Joancomartí [6] provide an exhaustive review of papers on Bitcoin anonymity research. according to the author, very few papers have been published regarding the traffic of Bitcoin that may reveal private information.…”

Section: Classification Of the Relevant Papersmentioning

confidence: 99%

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Where Is Current Research on Blockchain Technology?—A Systematic Review

et al. 2016

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Blockchain is a decentralized transaction and data management technology developed first for Bitcoin cryptocurrency. The interest in Blockchain technology has been increasing since the idea was coined in 2008. The reason for the interest in Blockchain is its central attributes that provide security, anonymity and data integrity without any third party organization in control of the transactions, and therefore it creates interesting research areas, especially from the perspective of technical challenges and limitations. In this research, we have conducted a systematic mapping study with the goal of collecting all relevant research on Blockchain technology. Our objective is to understand the current research topics, challenges and future directions regarding Blockchain technology from the technical perspective. We have extracted 41 primary papers from scientific databases. The results show that focus in over 80% of the papers is on Bitcoin system and less than 20% deals with other Blockchain applications including e.g. smart contracts and licensing. The majority of research is focusing on revealing and improving limitations of Blockchain from privacy and security perspectives, but many of the proposed solutions lack concrete evaluation on their effectiveness. Many other Blockchain scalability related challenges including throughput and latency have been left unstudied. On the basis of this study, recommendations on future research directions are provided for researchers.

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Section: Classification Of the Relevant Papersmentioning

confidence: 99%

“…In addition, the conversions with traditional currencies, e.g. KRW, EUR and USD, occur constantly in currency exchange markets [6][7]. Bitcoin has therefore gained the attention of various communities and is currently the most successful digital currency using Blockchain technology [6].…”

Section: Introductionmentioning

confidence: 99%

Where Is Current Research on Blockchain Technology?—A Systematic Review

et al. 2016

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“…Reid and Harrigan [4] created such networks in their paper analyzing Bitcoin privacy. In a paper reviewing Bitcoin privacy papers, Herrera-Joancomartí [6] states that this user network allowed Reid and Harrigan do user-centered analysis, giving context to the data in the blockchain. Reid and Harrigan also created an ancillary network when linking keys (nodes being a unique key and edges being a relationship between two keys).…”

Section: State Of the Art In Off-chain Transactions Analysismentioning

confidence: 99%

Evaluating Methods for the Identification of Off-Chain Transactions in the Lightning Network

Nowostawski

Tøn

2019

Applied Sciences

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Payment channels and off-chain transactions are used to address blockchain scalability. Those mechanisms rely on the blockchain proper, as the resolution mechanism. They allow for high transaction throughput due to the pure peer-to-peer nature of the transaction exchange that happens directly between the peers, without the involvement of the blockchain transactions. The transactions are not mediated through the blockchain but happen off-chain. The transactions in such overlay networks are not included in the blockchain, they nevertheless leave some data traces in a public ledger. We have used the Bitcoin mainnet and testnet blockchains together with the Lightning network node to explore what can be inferred from the underlying blockchain in the context of Lightning transactions, channel setup, and channel teardown. The main purpose of this study is to identify what methods, transaction signatures, and data can be used to understand the non-visible publicly off-chain transactions. We have proposed heuristics for identifying the setup and teardown transactions, quantified and analyzed the effectiveness of our proposed methods. Using the data from the Bitcoin blockchain, as well as the data from the Lightning network to link related information we have found when parsing the blockchain, we generate network graph representations showing the relationships between the Lightning network channels identified on the blockchain. This study is significant from the personal data and privacy perspectives, as well as from forensics. We have established that at least 75% of all P2WSH transactions are Lightning transactions, and some of the channels can be deduced from the blockchain analysis. The synthesized results demonstrate that our methods are viable for identifying a subset of transactions and that only partial topology of the payment channels can be obtained from the data left in the blockchain.2 of 38 allows users to do transactions without the actual publishing of the transaction in the Bitcoin ledger itself. The transactions are not included in the blockchain, which is why they are referred to as off-chain transactions. This makes it possible for more transactions to be done without increasing the capacity of the Bitcoin system itself. It can be thought of as an overlay layer on top of the Bitcoin system since it requires the Bitcoin system for verification and conflict resolution. One of such overlay networks is the Lightning network. The Lightning network, as described by Poon and Dryja [2], is a payment channel network currently deployed on top of the Bitcoin network. A payment channel is a one-to-one channel allowing two participants to exchange funds between each other. The Bitcoin blockchain has been used in the past in research projects focusing on anonymity and privacy of users [4,5]. Because the data in the blockchain provides a complete record of how funds are moved between entities, it is relatively easy to analyze the data from the blockchain and determine user involvement in transactions and the flow of fu...

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“…A Bitcoin transaction consists of an input section and an output section [34]. Source addresses and destination addresses are denoted in the input and output sections, respectively, and the amounts of Bitcoin the destination addresses would receive are indicated in the output section.…”

Section: Evaluation Via Real Bitcoin Transaction Datasetmentioning

confidence: 99%

A Model for Deriving Trust and Reputation on Blockchain-Based e-Payment System

et al. 2019

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E-commerce has become a crucial part of our life allowing us to buy products, request services, and transfer money easily with a press of a button. As such, establishing immutable trust and reputation of entities that are resilient to manipulation by the malicious are critical in today's online systems. In this work, we propose a model for calculating trust and reputation using the values stored on blockchain ledger. The model is applied to blockchain-based online payment systems which have a characteristic of immutability by preventing data manipulation. The model normalizes user evaluations based on each user's personal evaluation criteria that changes over time.In addition, the model derives reputation of, and trust between, users by applying psychological factors. We evaluate our model using not only simulated transaction data but also on real Bitcoin transaction-based dataset to show that our model is able to derive stable values from immutable transactions on blockchain-based online payment systems. Our model has been built into a live commercial blockchain service platform, and new application developments are underway.

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Research and Challenges on Bitcoin Anonymity

Cited by 84 publications

References 16 publications

Where Is Current Research on Blockchain Technology?—A Systematic Review

Where Is Current Research on Blockchain Technology?—A Systematic Review

Evaluating Methods for the Identification of Off-Chain Transactions in the Lightning Network

A Model for Deriving Trust and Reputation on Blockchain-Based e-Payment System

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