Towards faster settlement in HTLC-based Cross-Chain Atomic Swaps

Abstract

<p>Hashed Timelock (HTLC)-based atomic swap pro- tocols enable the exchange of coins between two or more parties without relying on a trusted entity. This protocol is like the <em>American call option</em> without premium. It allows the finalization of a deal within a certain period. This puts the swap initiator at liberty to delay before deciding to proceed with the deal. If she finds the deal unprofitable, she just waits for the time- period of the contract to elapse. However, the counterparty is at a loss since his assets remain locked in the contract. The best he can do is to predict the initiator’s behavior based on the asset’s price fluctuation in the future. But it is difficult to predict as cryptocurrencies are quite volatile, and their price fluctuates abruptly. We perform a game theoretic analysis of HTLC-based atomic cross-chain swap to predict whether a swap will succeed or not. From the strategic behavior of the players, we infer that this model lacks fairness. We propose <em>Quick Swap</em>, a two-party protocol based on hashlock and timelock that fosters faster settlement of the swap. The parties are required to lock griefing-premium along with the principal amount. If the party griefs, he ends up paying the griefing-premium. If a party finds a deal unfavorable, he has the provision to cancel the swap. We prove that <em>Quick Swap</em> is more participant-friendly than HTLC- based atomic swap. Our work is the first to propose a protocol to ensure fairness of atomic-swap in a cyclic multi-party setting.</p> <p>(Accepted in Special Session of The Fourth IEEE International Conference on Trust, Privacy and Security in Intelligent Systems, and Applications, 2022)</p>

Fast Payments Across Heterogeneous Blockchains for Internet of Things

“…Mazumdar et al [27] introduced Quick Swap, an enhanced HTLC-based atomic swap protocol incorporating innovative concepts to mitigate latency and fairness issues associated with traditional atomic swaps. By integrating a griefing penalty mechanism, Quick Swap aims to encourage timely settlements by penalizing delays and offering an option to cancel swaps, addressing some flexibility and fairness challenges of conventional HTLC exchanges while still leveraging blockchain's inherent features like smart contracts and cryptographic proofs for secure and enforceable exchanges.…”

“…Both the MyBlockEHR [24] and Practical AgentChain [25] schemes exclusively executed homogenous crosschain functionality on the Ethereum platform, lacking support for heterogeneous cross-chain operations. Furthermore, Anyswap, Wecross, [27] and [28] are susceptible to consensus mechanism constraints, resulting in significant transaction delays. Among these, Anyswap and Wecross exhibit a relatively restricted range of supported blockchain networks.…”