A decentralized trust management mechanism for crowdfunding

Abstract

Crowdfunding is an act of raising funds from the public to support an individual or organizational project, and the success of crowdfunding projects lies in gaining backers' trust. In practice, however, crowdfunding platforms are rife with fraudulent crowdfunding projects. While some crowdfunding platforms use third-party auditors to verify projects before publishing, this also runs the risk of collusion between crowdfunders and auditors. The recent introduction of blockchain has increased the transparency of crowdfunding, but they, too, lack fraud prevention measures. Obviously, existing crowdfunding trust management schemes are not applicable under a zero-trust scenario. In this study, we propose a blockchain-based trust management mechanism for crowdfunding to address the fraudulent behavior in the existing crowdfunding systems. We introduce an auditor committee to audit crowdfunding projects credibly. A random selection algorithm on the blockchain enables the distributed generation of auditor committees with a trade-off between the randomness of selection and auditor expertise. The audit results are based on independent auditing by the audit committee members and are presented by the smart contract, avoiding the influence of third parties. In addition, we also provide an incentive mechanism to encourage auditors who perform accurate audits. Theoretical analyses and experiments show that our scheme can effectively deal with malicious behaviors and has an acceptable overhead.