Enhanced Lightning Network (off-chain)-based micropayment in IoT ecosystems

Abstract

Information is being seen as the new “oil” for companies. Trading and negotiating personal data, which includes data generated by owned smart devices, is gaining attention and acceptance in the Internet of Things (IoT) era. There is a global trend to move towards open innovation ecosystems that allow data owners to have better control over their data and privacy, choosing if/what and with whom to share/trade specific data streams. Nonetheless, this requires the design of IoT ecosystems that integrate automatic enforcing mechanisms to guarantee the delivery of the negotiated data, or still the capability of making near-instantaneous payments for the data (in the form of micro-units). This paper discusses the requirements that need to be fulfilled to properly support (micro)-payment in IoT, and further the extent to which different blockchain technologies can fulfill those requirements. Based on this analysis, our paper progresses the current state-of-the-art in three-respect: (i) by carrying out a benchmark performance analysis between LN and other-like solutions; (ii) by integrating the Lightning Network (LN) off-chain technology within an existing IoT ecosystem, developed as part of the bIoTope H2020 project, and (iii) by designing a novel algorithm for payment channel fee reduction. Experiments carried out in this paper show that LN outperforms traditional blockchain solutions under IoT-specific constraints and objectives, and that an optimal parameter setting of the proposed algorithm can be identified.