Transaction Privacy Research Articles

Beyond technology: Considerations for retail central bank digital currency adoption in Asia–Pacific

While central banks’ objectives for issuing central bank digital currencies (CBDCs) are increasingly clear, many observers continue to raise questions regarding the usefulness of CBDCs for the broader population. This question is particularly relevant for Asia-Pacific economies where the payment infrastructure is generally both efficient and resilient, and digital payments have been widely adopted. As this paper will argue, ensuring the adoption of CBDCs in Asia-Pacific requires a ‘future-proof’ solution that is sufficiently flexible to adapt to advances in payments technology. In addition, any solution will have to replicate the underlying benefits of physical cash, such as offline availability, while addressing concerns around transaction privacy.

SofitMix: A Secure Offchain-Supported Bitcoin-Compatible Mixing Protocol

Privacy preservation is highly expected in the Bitcoin Network. However, only applying pseudonyms cannot completely ensure anonymity/unlinkability between payers and payees. Current approaches mainly depend on a mixer service, which obfuscates payer-payee relationships of transactions. While the mixer service improves transaction privacy, it still suffers from some severe security threats (e.g., DoS attack and collusion attack), and does not support effective and reliable off-chain payment in a parallel mode. In this paper, we propose a mixing protocol for the Bitcoin Network based on zero-knowledge proof, called SofitMix. It is the first mixing protocol that can effectively resist both the DoS attack and the collusion attack. It can also support a set of parallel off-chain payments in a reliable way no matter whether some payers abort a transaction. We analyze and prove SofitMix security following the Universal Composability model with regard to fair exchange, unlinkability, collusion-resistance, DoS-resistance and Sybil-resistance. Through a proof-of-concept implementation, we demonstrate its validity and fairness. We also show its advance on off-chain payment reliability and DoS attack resistance, compared to TumbleBit.

Zk-SNARKs As A Cryptographic Solution For Data Privacy And Security In The Digital Era

This research brings the concept of zk-SNARKs (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) in the context of data security and privacy in the digital world. zk-SNARKs is a cryptographic technology that allows individuals to prove a statement or knowledge without having to reveal the actual details of the information. We illustrate this concept through a simple example of proving age over 18 without revealing the actual date of birth. This research highlights the importance of maintaining data privacy in various technological applications, including the use of zk-SNARKs in blockchain to maintain transaction privacy and personal data protection in increasingly sophisticated applications. However, the implementation of zk-SNARKs requires deep mathematical understanding and strong data security concerns. With great potential to support data privacy and security in the evolving digital era, zk-SNARKs is a highly relevant tool in addressing privacy-related challenges in the digital world. The conclusion of this research is that zk-SNARKs is an important tool in maintaining data privacy and security in the digital age. With its ability to allow individuals to prove knowledge or assertions without revealing actual details of information, this technology has wide applications in various sectors, including finance, data management, and data privacy protection. However, it should be emphasized that the implementation of zk-SNARKs requires extra care in securing the system and ensuring that the technology is used properly to maintain high data privacy and security. With further development and understanding in this technology, zk-SNARKs can be an integral component in building a safer and more private digital world.

RATS: A regulatory anonymous transaction system based on blockchain

With the rapid development of digital currency such as Bitcoin, the digital currency transaction system with blockchain as the key underlying technology is booming, but the traditional transaction system has the risk of revealing sensitive information such as transaction content and identity. In order to enhance the security, many transactions system with privacy preserving have been proposed, such as Zerocoin, Monero, etc. As there are a decentralized credit entity and strong anonymity in these transaction systems, the authorities can effectively audit and control the participants and transactions in the digital currency system, thus making digital currency a tool for illegal transactions. Recognizing the importance of privacy preserving and regulatory, in this paper, we propose a new regulatory anonymous transaction system based on blockchain—RATS, which can not only protect the privacy of transactions on the blockchain, but also regulate illegal transactions. Firstly, we introduce regulators into the system, and at the same time, we propose a regulatory mechanism that the regulator is allowed to trace the identity of the user without affecting the transaction operation of the system when suspicious transactions are found. In particularly, during the normal transaction, we protect the privacy of users' transaction contents and addresses without affecting the anonymity of the original system. We formalize the system model and security model of RATS. Moreover, the security of the proposed scheme is strictly proved and analyzed.

Three-tier Storage Framework Based on TBchain and IPFS for Protecting IoT Security and Privacy

Recently, most of the Internet of things (IoT) infrastructures are highly centralized with single points of failure, which results in serious security and privacy issues of IoT data. Fortunately, blockchain technique can provide a decentralized and secure IoT framework to deal with security issues based on the characteristics of decentralization, non-tampering, openness, transparency, and traceability. However, the blockchain consensus protocol guarantees the safety and reliability of data, but it also brings problems such as scalability limitations and poor storage extensibility, resulting in the inability to directly integrate blockchain and the IoT in existing conditions. In this article, a private three-tier local blockchain, Three-tier architecture Blockchain (TBchain), is proposed to solve the problem by splitting part of the transactions in the public blockchain and locking them in a higher-level blockchain TBchain. Additionally, the private blockchain TBchain is connected to the public blockchain to build a hierarchical blockchain network to provide privacy protection for the IoT data stored on the blockchain. Finally, we implement an IoT framework based on TBchain and the InterPlanetary File System (IPFS) to realize the decentralized IoT, which guarantees the user’s access control right to personal data. Experimental results show that the IoT framework based on TBchain and IPFS realizes the user’s access control right to personal data by verifying in advance to ensure the confidentiality and security of shared data, and improves the security and privacy of IoT data and transactions. Moreover, we prove that the scalability and storage extensibility of the blockchain is positively correlated with the number of data blocks in TBchain.

Legal Comparison of Electronic Contract in Electronic Commerce Between Indonesia and the United States Based on the United Nations Commission on International Trade Law

Objective: The importance of an electronic deal is the validity of the electronic information contained in it. The real reality that occurs in cyber activities is complex because such deeds are no longer limited to the territory of any other country.
 
 Method: The United Nations Commission on Global Trade Law (UNCITRL) model law on electronic trade was established as a fundamental rule for regulating the validity, recognition, and results of electronic messages based on the use of computers in trade activities. Indonesia and the United States are among the member states of the UNCITRL state that can actively participate in the drafting of the UNCITRL Agreement and adopt model legislation. The aim of this learning was to compare the regulation of electronic contracts in Indonesia and the United States by referring to the UNCITRL model law on electronic commerce. The legal research methodology used in this study is the standard legal approach using statutory methods and conceptual methods.
 
 Results: The results show that although both Indonesia and the United States have adopted some provisions of the UNCITRL Model Act in the field of electronic commerce, they have different legal implications.
 
 Conclusions: The Electronic Information and Transaction Act – commonly known as UU ITE in Indonesia – focuses on the use of report technology and the Internet to ensure the security and privacy of electronic transactions, as well as to provide legal guarantees to technology users. UETA focuses on legalizing electronic communications, including electronic contracts, to remove as many barriers to electronic commerce as possible.

PRI: PCH-based privacy-preserving with reusability and interoperability for enhancing blockchain scalability

Blockchain systems, one of the most popular distributed systems, are well-applied in various scenarios, e.g., logistics and finance. However, traditional blockchain systems suffer from scalability issues. To tackle this issue, Payment Channel Hubs (PCHs) are proposed. Recent efforts, such as A2L (SP'21) and Teechain (SOSP'19), enhance the privacy, reusability, and interoperability properties of PCHs. Nevertheless, these solutions have intrinsic limitations: they rely on trusted hardware or suffer from the deposit lock-in problem. Furthermore, the functionalities of some of these solutions are restricted to fixed-amount payments and do not support multi-party participation. These aforementioned problems limit their capabilities to alleviate blockchain scalability issues. In this paper, we propose PRI, a novel PCH solution that simultaneously guarantees transaction Privacy (i.e., relationship unlinkability and value confidentiality), deposit Reusability, and blockchain Interoperability, which can mitigate the aforementioned problems. PRI is constructed by several new building blocks, including (1) an atomic deposit protocol that enforces user and hub to deposit equivalent assets in a shared address for building a fair payment channel; (2) a privacy-preserving deposit certification scheme that leverages the Pointcheval and Sanders signature and non-interactive zero-knowledge proof to resolve the deposit lock-in issue in maintaining payment channels; (3) a range proof which ensures the legality and confidentiality of transaction values. We conduct extensive experimental evaluations of PRI, demonstrating that it improves the state-of-the-art approaches in terms of performance.

Blockchain aware proxy re-encryption algorithm-based data sharing scheme

The blockchain stores transaction data in a distributed shared global ledger. It is challenging to strike a balance between privacy protection and usefulness while sharing data. Moreover, the dynamic adjustment of blockchain data access rights is a challenging problem. To this end, this paper suggests a blockchain data-controlled sharing scheme based on proxy re-encryption. First, a proxy re-encryption algorithm is constructed based on SM2 and the blockchain. Blockchain data sharing can give businesses a secure way to store and share data. Since this network is decentralized, and data is transmitted across a peer-to-peer network under the protection of an unchangeable cryptographic signature. Blockchain makes it more difficult to alter or hack the data. The data-controlled sharing scheme uses proxy re-encryption to protect transaction data privacy and realize data security sharing. Secondly, a dynamic adjustment mechanism for user rights is proposed. Blockchain nodes divide labor and manage re-encryption key parameters separately to achieve user access rights determinism Update, the visibility of transaction data is dynamically adjusted. Finally, the performance and security evaluation demonstrate that this scheme can realize the dynamic sharing of blockchain data while protecting transaction privacy and has advantages in computing overhead, which is better applicable to the Controlled sharing of blockchain data. This research suggests a regulated blockchain-based data-sharing system that makes use of proxy re-encryption. They are developing a proxy re-encryption algorithm with SM2 in order to fully safeguard the privacy of transaction data and to achieve data access authority determination by controlling proxy re-encryption key parameters. It is suggested to employ a hybrid attribute-based proxy re-encryption method that enables the proxy server to change attribute-encrypted cypher texts into identity-based encrypted cypher texts so that users with limited resources can access the previously encrypted material.

A two-layer consortium blockchain with transaction privacy protection based on sharding technology

In the traditional consortium blockchain system, all nodes jointly participate in the process of transaction consensus, so that the confidentiality of transaction data within and between organizations in the consortium cannot be protected; and the throughput of the existing consortium blockchain system is still low. In response to the above problems, we propose a two-layer consortium blockchain with transaction privacy protection based on sharding technology. The blockchain consists of a sharding layer and a root consensus layer, which supports internal transactions of distributed interactive organizations, confidential transactions across shards, and public transactions across shards. At the sharding layer, we shard the nodes and their corresponding UTXOs, and ensure the confidentiality of transaction data by authorizing nodes in different shards to access different transaction data. And through the root consensus layer, the processing reliability, tamper-proof and traceability of confidential transactions across shards and internal transactions are guaranteed. The system throughput is improved by parallel processing of transactions using sharding technology, and the blockchain system with an improved Byteball architecture inside the shard, which further improves the transaction throughput of the system. And through analysis, it shows that the consortium blockchain proposed in this scheme is reasonable and feasible.

Blockchain-Based Resource Trading in Multi-UAV-Assisted Industrial IoT Networks: A Multi-Agent DRL Approach

With the Industrial Internet of Things (IIoT), mobile devices (MDs) and their demands for low-latency data communication are increasing. Due to the limited resources of MDs, such as energy, computation, storage, and bandwidth, IIoT systems cannot meet MDs’ quality of service (QoS) and security requirements. Recently, UAVs have been deployed as aerial base stations in the IIoT network to provide connectivity and share resources with MDs. We consider a resource trading environment where multiple resource providers compete to sell their resources to MDs and maximize their profit by continually adjusting their pricing strategies. Multiple MDs, on the other hand, interact with the environment to make purchasing decisions based on the prices set by resource providers to reduce costs and improve QoS. We propose a novel intelligent resource trading framework that integrates multi-agent deep reinforcement Learning (MADRL), blockchain, and game theory to manage dynamic resource trading environments. A consortium blockchain with a smart contract is deployed to ensure the security and privacy of the resource transactions. We formulated the optimization problem using a Stackelberg game. However, the formulated optimization problem in the multi-agent IIoT environment is complex and dynamic, making it difficult to solve directly. Thus, we transform it into a stochastic game to solve the dynamics of the optimization problem. We propose a dynamic pricing algorithm that combines the Stackelberg game with the MADRL algorithm to solve the formulated stochastic game. The simulation results show that our proposed scheme outperforms others to improve resource trading in UAV-assisted IIoT networks.

Research on Privacy Protection of Technology Service Transactions Based on Blockchain and Zero-Knowledge Proof

In view of the problem that the transaction privacy in the current blockchain technology service is easy to be leaked, a bulletproof alliance chain technology service transaction privacy protection mechanism is proposed. Firstly, this paper uses digital certificates as access mechanisms and stores them on the chain to ensure that the identity of technical service transactions is trusted. Secondly, the transaction data of the technical service user is hidden in the Pedersen commitment, and the Bulletproof is used to build the scope proof. Enable the verifier to conduct confidential verification of the legitimacy of the transaction without obtaining the sensitive information of the transaction, so as to ensure that the user’s transaction privacy is not disclosed. Finally, the security and privacy of the proposed privacy protection scheme are analyzed, and the comparison with other zero-knowledge proof schemes shows that the scheme has the advantages of strong privacy, scalability, and low storage cost.

Cross-Chain Virtual Payment Channels

With the emergence of countless independent blockchain systems in recent years, cross-chain transactions have attracted considerable attention, and lots of solutions have been put forth by both industry and academia. However, most of the existing solutions suffer from either centralization or scalability issues. To mitigate these issues, in this paper, we propose the concept of cross-chain virtual payment channels, which allows two users in different blockchain systems to conduct limitless off-chain transactions with the help of an intermediate node, hence solving the centralization and scalability issues. Furthermore, as the intermediate node is only involved in the channel open and close operations, it further improves the efficiency of cross-chain transactions, and to a certain extent, it even enhances the privacy of the cross-chain transaction. Meanwhile, we also present the first concrete cross-chain virtual payment channel scheme, which only requires one of the blockchain systems supporting the Turing-complete scripting language. The corresponding detailed security analysis in the Universal Composability framework demonstrates that our proposal holds the Consensus on Open, Update, and Close. Finally, we implement and deploy our cross-chain virtual payment channel scheme on the Ethereum and Bitcoin test networks. The extensive experimental results show that our proposal dramatically improves the efficiency of cross-chain transactions, and the advantage becomes more pronounced as the number of transactions increases.

HyperMaze: Towards Privacy-Preserving and Scalable Permissioned Blockchain

Blockchain systems face two emergent problems, namely scalability and privacy, each of which has been addressed independently. However, how to achieve privacy and scalability simultaneously remains a challenging problem for blockchains. In this article, we propose a privacy-preserving and scalable permissioned blockchain system called HyperMaze employing the zero knowledge proof technique and a hierarchical system architecture. It gains scalability by adopting a hierarchy of multiple blockchains that processes transactions in parallel. We design an <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">ID-based dual-balance account model</i> where an identity-based account is associated with two types of balances–a plaintext balance and a private (zero-knowledge) balance. Furthermore, we design a two-phase cross-chain transaction mechanism (2PXT) to achieve transaction privacy for both intra-chain and cross-chain transactions. We rigorously formulate a security model for HyperMaze under the universal composability framework, and then provide a simulation-based security proof. A prototype of HyperMaze is implemented and a series of experiments are conducted over up to 2,600 nodes to evaluate its performance. The experimental results show that a 4-level, (7,10)-threshold, 6-ary HyperMaze system can reach 19,440 TPS and the transaction confirmation latency is only 9.5 seconds. To our best knowledge, HyperMaze is the first high-throughput privacy-preserving blockchain whose throughput is over 19,000 TPS.

A Charging and Discharging Model for Electric Vehicles based on Consortium Blockchain Using Multi-Objective Gray Wolf Algorithm

Background: As many EVs (EVs) are connected to the grid, transactions between EVs and the grid will have problems such as poor privacy and affecting the stability of the grid. This paper uses consortium blockchain to design a safe and privacy-preserving scheme for the two-way power transaction between EVs and the grid. Objective: : To reduce the adverse impact of disorderly charging of large-scale EVs on the power grid, the total load variance is minimized by optimizing EVs' charging/discharging period. Methods: We propose to use a heuristic algorithm, an improved multi-objective gray wolf algorithm, to solve this problem. Results: The simulation results show that the model can effectively smooth load fluctuations and improve user benefits. Conclusion: Our method can effectively reduce the load fluctuation of the grid while ensuring the economic benefits of users. Qualitative security and privacy analysis show that the solution helps to improve the security and privacy of electricity transactions.

Lattice-Based Verifiably Encrypted Signature Scheme without Gaussian Sampling for Privacy Protection in Blockchain

Before the transaction data in the blockchain is successfully linked, its signature must be publicly verified by a large number of nodes in the blockchain, which is also one of the ways to leak transaction information. To alleviate the contradiction between the public verifiability of signatures and the protection of transaction privacy, we introduce a verifiably encrypted signature scheme into the blockchain. A verifiably encrypted signature scheme contains two parts of signature information: the encrypted signature is used for public verification, and the ordinary signature is used for internal verification. To reach this goal even better, we design a new lattice-based verifiably encrypted signature scheme, which separates the parameter settings of the signer and the adjudicator, and replaces the Gaussian sampling algorithm with a small range of uniform random sampling, achieving better efficiency and security.

Consortium Blockchain-Based Computation Offloading Using Mobile Edge Platoon Cloud in Internet of Vehicles

The rapid advancement of intelligent vehicles is deemed crucial to the emergence of diverse compute-intensive applications of assisted driving, which consist of automatic driving, speed recognition, hybrid sensing data fusion, etc. Nevertheless, resources-constraint vehicles with high mobility cannot always meet the computing and communication demands when the above applications occur. Additionally, considering the expensive and inflexible deployment of edge servers, offloading application tasks to “Edge” in the vehicular networks is not always working well. To effectively mitigate the above issues, the complicated application tasks are motivated to offload to the vehicle platoon, where the vehicles travel synchronously in a string with small headway. Benefiting from the stable connectivity, adjustable mobility, and reasonable charge, the task vehicle would like to process the task by leveraging the idle resources of each platoon member (PM). To make more effective use of the resources on the mobile edge platoon cloud (MEPC), we investigate the resource allocation strategy based on the task vehicle’s service pricing strategy in this work. We first formulate the interactions between MEPC and task vehicle as a Stackelberg game to study the joint utility maximization of the MEPC and task vehicle. Then the Stackelberg Equilibrium (SE) for the proposed game is characterized and proved. The proposed algorithm Hook-Jeeves-based Stackelberg game (HJSG) can reach the SE. Finally, we introduce the consortium blockchain to ensure the security and privacy of service transactions. The entire system helps enhance task processing efficiency, protect transaction data, and improve service experience. Experimental results over numerical simulation based on practical scenarios demonstrate that compared with Multi-round Stackelberg Game (MRSG), uniform pricing, and the local computation strategy, the proposed HJSG algorithm can attain less execution time and faster convergence performance.

Kriper: A blockchain network with permissioned storage

Blockchain has been a revolution in the past few years. Beyond the new currencies that were created around different incarnations of the blockchain concept, there are many other contributions that provide interesting services as a data linked structure using a decentralized network that provide a high level of security. Companies have developed many projects to incorporate blockchain into their business logic pursuing to incorporate other related services as persistence of large volumes of data, privacy or anonymity of transactions, distributed data processing, security (confidentiality, integrity, and availability), document management or micro messages in real time. Nevertheless, as it will be discussed in this article, current blockchains do not meet the needs of companies in many aspects, leading to a scarce or superficial adoption. This article introduces Kriper, a blockchain that aims at meeting corporate world needs by responding with a community-based, open blockchain that may also be segregated and private for certain uses whereas it provides a permissioned distributed storage and micro message lightweight services.

Transactions privacy on blockchain using web of trust concept

ABSTRACT Exchange of information through the web took place inside a trusted environment and thus user privacy was assured by default. Nowadays, ensuring user privacy is becoming one of the most desirable features of new technology, and Blockchain is not an exception. The Blockchain is a decentralized technology, open, and public platform where all transactions are stored and viewed from nodes, an approach known as “Web of Trust.” Although these transactions tend to be anonymous but in the case of the banking sector, user privacy requires special attention. In centralized systems, the implementation of privacy is no longer a challenge, using a hierarchical approach such as Public Key Infrastructure. This paper presents a broad landscape and state of art of user transaction privacy in Blockchain technology using the Web of Trust approach. Furthermore, we present a novel approach using the Public Key Infrastructure for assuring user privacy adding an optionally encrypted field in blocks in transactions. We have used Bithomp, as a free and open-source tool with the Testnet platform, and Ripple as the best known in the implementation of the payment system to implement the proposed approach. The paper concludes with the strengths and limitations of the proposed approach.

A Survey of Blockchain Technology: Architecture, Applied Domains, Platforms, and Security Threats

Blockchain technology is at the peak of hype and contemporary research area across the world. It is a distributed ledger that keeps records of transactions with verifiable and immutable structures and continuously grows with the new block of transactions. Blockchain provides better transparency, enhanced security and privacy, and true traceability over the traditional approaches. Due to its advanced and secure features, it is being used in various fields such as trade finance, digital transactions, the Internet of Things (IoT), the healthcare industry, and energy sector. Blockchain technology has a great impact in all its applied fields with the prominent features of privacy and reliability of data and transactions. This survey intends to present the architecture of blockchain, its potential applications, and practices in different domains other than cryptocurrency along with the platform of blockchain. This paper will explore some potential benefits of blockchain and some future directions and open challenges that are expected to come in future research.

RBSmix: A Regulatable Privacy-Preserving Method for Cryptocurrency

Public chains represented by Bitcoin and Ethereum do not require users to use their real names, and transaction data are open to the whole network. Analysed based on this, researchers have achieved the deanonymization of blockchain transactions to a certain extent. Based on the existing blockchain transaction privacy protection scheme, the true link relationship between the transaction sender and receiver is hidden, which brings difficulties to regulation. In this paper, we propose a cryptocurrency mixing service RBSmix, which allows users to reestablish their financial privacy in Bitcoin and related cryptocurrencies. RBSmix, through blind signature to prevent attackers from linking input and output addresses, by the threshold secret sharing algorithm, encryption technology, and a regulation team, combined with the idea of voting, tracks the source of funds for illegal addresses. Experiments show that the scheme scales to large numbers of users and can provide users with better privacy protection.