Understanding Payment Channels in Cryptocurrency Networks
Explore the concept of payment channels in cryptocurrency networks to address scalability issues and reduce transaction costs. Learn how these channels enable fast and cost-effective transactions by minimizing blockchain usage. Discover the innovative solutions proposed by experts in the field.
Download Presentation
Please find below an Image/Link to download the presentation.
The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author. Download presentation by click this link. If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.
E N D
Presentation Transcript
Routing Cryptocurrency with the Spider Network VIBHAALAKSHMI SIVARAMAN, SHAILESHH VENKATAKRISHNAN, MOHAMMAD ALIZADEH, GIULIA FANTI, PRAMOD VISWANATH
What is a blockchain? Blockchain (1) 4 Miners Alice Bob 2
Blockchain Transactions 1 1 (1) 4 Alice (3) Bob 2 2 3 (2) Alice Bob 5 (5) (4) 4 5 Mary Eve Charlie Alice Bob Eve 3
Cryptocurrencies dont scale! STORAGE LATENCY FEES Needs 350 additional GB per day for faster transactions Bitcoin transaction confirmation time 1 hr Some transactions can be as expensive as $34 4
Solution: Payment Channels 1 1 1 Key Idea: Use blockchain (as arbiter) only as necessary! 2 2 2 5
Solution: Payment Channels (1) 4 3 1 Open Channel Alice Bob 2 6
Solution: Payment Channels (1) 4 3 4 3 1 1 (2) 3 4 Open Channel Txn 1 Alice Bob 2 2 Alice Bob 7
Solution: Payment Channels (1) 4 3 1 1 (2) Open Channel (3) Txn 1 5 3 2 4 Txn 2 Alice Bob 2 2 Alice Bob - Alice Alice Bob 8
Solution: Payment Channels (1) 4 3 3 1 1 (2) 4 Open Channel (3) Txn 1 5 2 (4) Txn 2 5 Alice 2 Bob 2 2 (5 ) Alice Txn 2 Bob 5 2 - Alice Alice Alice (n) Txn 2 Bob 5 2 - Bob Close Channel Bob - Bob Alice Bob - Bob Alice Bob 9
Payment Channel Network Charlie Alice 6 6 3 Bob 0 1 1 3 3 3 1 Eve Mary 10
Payment Channel Network Alice wants to send 3 coins to Bob Charlie Alice 6 6 3 Bob 0 1 1 3 3 3 1 Eve Mary 11
Payment Channel Network Alice wants to send 3 coins to Bob Charlie Alice 6 6 3 Bob 0 1 1 3 3 3 1 Eve Mary 12
Payment Channel Network Alice wants to send 3 coins to Bob Charlie Alice 6 3 6 6 3 3 Bob 3 0 1 1 3 3 3 1 Eve Mary 13
Routing in Payment Channel Networks Alice wants to send 3 more coins to Bob Charlie Alice 6 3 3 Bob 3 1 1 3 3 3 1 Eve Mary 14
Routing in Payment Channel Networks Alice wants to send 3 more coins to Bob Charlie Alice 6 3 3 Bob 3 1 1 3 3 3 1 Eve Mary 15
Routing in Payment Channel Networks Alice wants to send 3 more coins to Bob Charlie Alice 6 3 3 Bob 3 1 1 3 3 3 1 Eve Mary 16
Routing in Payment Channel Networks Alice wants to send 3 more coins to Bob Charlie Alice 9 6 3 0 3 6 0 Bob 3 1 1 3 3 3 1 Eve Mary 17
Routing in Payment Channel Networks Charlie Alice 9 6 Bob 0 0 1 1 3 3 3 1 Eve Mary 18
Routing in Payment Channel Networks Charlie wants to send 3 coins to Bob Charlie Alice 9 6 Bob 0 0 1 1 3 3 3 1 Eve Mary 19
Payment Channel Network Charlie wants to send 3 coins to Bob Charlie Alice 9 6 Bob 0 0 1 1 3 3 3 1 Eve Mary 20
Payment Channel Network Charlie wants to send 3 coins to Bob Charlie Alice 9 6 Bob 0 0 1 1 3 3 3 1 Eve Mary 21
The Spider Network Goal: Design routing in payment channel networks for high transaction throughput with a small amount of capital Approach: Packet-switched Network: Split transactions at senders Balance aware-routing: Route based on real time balance information 22
Packet-switched Payment Channel Network Alice wants to send 3 coins to Bob Charlie Alice 6 3 2 Bob 0 1 1 3 3 3 1 Eve Mary 23
Packet-switched Payment Channel Network Alice wants to send 3 coins to Bob Charlie Alice 6 3 2 Bob 0 1 1 3 3 3 1 Eve Mary 24
Packet-switched Payment Channel Network 1 Alice wants to send 3 coins to Bob Charlie Alice 2 6 3 2 Bob 0 1 1 3 3 3 1 Eve Mary 25
Packet-switched Payment Channel Network 1 Alice wants to send 3 coins to Bob Charlie Alice 2 3 3 2 Bob 0 1 1 3 3 3 1 Eve Mary 26
Packet-switched Payment Channel Network 1 Alice wants to send 3 coins to Bob Charlie Alice 2 3 3 2 Bob 0 1 1 3 3 3 1 Eve Mary 27
Packet-switched Payment Channel Network 1 Charlie Alice 2 3 5 6 3 2 Bob 0 0 1 0 1 3 4 3 2 3 2 1 2 Eve Mary 28
Supporting Large Payments Alice needs to send 30 coins to Bob Bob needs to send 30 coins to Alice 0/30 sent 1/30 sent 2/30 more 3/30 sent 4/30 sent 5/30 sent Done Charlie Alice 6 5 3 4 0/30 sent 1/30 sent 2/30 sent 3/30 sent 4/30 sent 5/30 sent Done 2 1 Bob 0 29
The Routing Problem Fluid Model: Transactions as continuous streams Rates per edge? Topology Payment Graph or Demand c1 Charlie 2 2 1 c6 c2 2 c3 1 2 c4 c5 1 1 Bob Alice Rate on forward edge = Rate on backward edge 30
Whats the best we can do? Payment Graph Circulation Can be routed DAG Needs blockchain 1 2 1 1 2 1 1 1 + = 1 2 1 1 1 2 1 2 1 1 1 1 31
Routing the Circulation Maximize sum of rates Constraints: Rate per edge < capacity Rate on forward edge = Rate on backward edge Topology ruv rvu ruv rvu rvu ruv ruv rvu ruv rvu ruv rvu 32
Decentralized Algorithm 9 6 3 0 Price increase Price decrease pvu puv Eve Charlie 33
Evaluation Simulator to model transaction processing Transactions modelled off real-time currency exchange data Topology modelled off ISP graphs and currency exchange data 34
Preliminary Results 90 Success Percentage 80 70 60 Circulation 50 40 30 20 10 0 Volume of payments completed SpeedyMurmurs Spider (LP) Number of payments completed SilentWhispers Spider (Waterfilling) Shortest Path 35
Summary Payment channels promise to improve cryptocurrencies scalability Yet, they suffer from imbalance problems We packetize transactions and use balance-aware routing to improve their transaction throughput Future Work: End-host rate control mechanisms In-network scheduling algorithms Economic incentives for intermediaries 36
Ripple Results 80 Success Percentage 70 60 50 40 30 Circulation 20 10 0 Volume of payments completed SpeedyMurmurs Spider (LP) Number of payments completed SilentWhispers Spider (Waterfilling) Shortest Path 37
