Application and evaluation of payment channel in hybrid decentralized ethereum token exchange

Traditional centralized token exchange (CEX) has been suffering from hacking due to the centralized management of users’ tokens. In contrast, decentralized token exchange (DEX) maintains users’ assets by smart contracts in a decentralized manner, but introduces additional overhead in terms of gas fe...

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Autores principales:	Xuan Luo, Zehua Wang, Wei Cai, Xiuhua Li, Victor C.M. Leung
Formato:	article
Lenguaje:	EN
Publicado:	Elsevier 2020
Materias:	Blockchain Payment channel Ethereum Smart contract Token exchange Optimal gas price Information technology T58.5-58.64
Acceso en línea:	https://doaj.org/article/c347cbfa40474113a8e77d68a2eee7fd
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spelling	oai:doaj.org-article:c347cbfa40474113a8e77d68a2eee7fd2021-11-04T04:28:29ZApplication and evaluation of payment channel in hybrid decentralized ethereum token exchange2666-953610.1016/j.bcra.2020.100001https://doaj.org/article/c347cbfa40474113a8e77d68a2eee7fd2020-12-01T00:00:00Zhttp://www.sciencedirect.com/science/article/pii/S2096720920300014https://doaj.org/toc/2666-9536Traditional centralized token exchange (CEX) has been suffering from hacking due to the centralized management of users’ tokens. In contrast, decentralized token exchange (DEX) maintains users’ assets by smart contracts in a decentralized manner, but introduces additional overhead in terms of gas fee and transaction confirmation latency. Hybrid decentralized token exchange (HEX) has been proposed to combine the benefits of CEX and DEX. However, existing HEX is criticized for two issues. First, trading transactions are time-consuming and expensive for frequent token traders. Second, excessive simultaneous transactions might cause the pending transaction congestion in the Ethereum network. In this paper, we propose a payment channel based HEX, which extends existing solutions by adding a new payment channel layer to benefit frequent traders and alleviate the pending transaction congestion. Besides, we propose the very first gas-price vs. transaction-confirmation-latency function to guide Ethereum transaction issuers to choose an optimal gas price that minimizes the overall cost. Extensive simulations are conducted to compare the cost in the proposed HEX with that in the conventional HEX. The results demonstrate the effectiveness of our proposed mechanism in terms of reducing gas fees and transaction confirmation latency for frequent traders as well as the pending transaction congestion in Ethereum.Xuan LuoZehua WangWei CaiXiuhua LiVictor C.M. LeungElsevierarticleBlockchainPayment channelEthereumSmart contractToken exchangeOptimal gas priceInformation technologyT58.5-58.64ENBlockchain: Research and Applications, Vol 1, Iss 1, Pp 100001- (2020)
institution	DOAJ
collection	DOAJ
language	EN
topic	Blockchain Payment channel Ethereum Smart contract Token exchange Optimal gas price Information technology T58.5-58.64
spellingShingle	Blockchain Payment channel Ethereum Smart contract Token exchange Optimal gas price Information technology T58.5-58.64 Xuan Luo Zehua Wang Wei Cai Xiuhua Li Victor C.M. Leung Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
description	Traditional centralized token exchange (CEX) has been suffering from hacking due to the centralized management of users’ tokens. In contrast, decentralized token exchange (DEX) maintains users’ assets by smart contracts in a decentralized manner, but introduces additional overhead in terms of gas fee and transaction confirmation latency. Hybrid decentralized token exchange (HEX) has been proposed to combine the benefits of CEX and DEX. However, existing HEX is criticized for two issues. First, trading transactions are time-consuming and expensive for frequent token traders. Second, excessive simultaneous transactions might cause the pending transaction congestion in the Ethereum network. In this paper, we propose a payment channel based HEX, which extends existing solutions by adding a new payment channel layer to benefit frequent traders and alleviate the pending transaction congestion. Besides, we propose the very first gas-price vs. transaction-confirmation-latency function to guide Ethereum transaction issuers to choose an optimal gas price that minimizes the overall cost. Extensive simulations are conducted to compare the cost in the proposed HEX with that in the conventional HEX. The results demonstrate the effectiveness of our proposed mechanism in terms of reducing gas fees and transaction confirmation latency for frequent traders as well as the pending transaction congestion in Ethereum.
format	article
author	Xuan Luo Zehua Wang Wei Cai Xiuhua Li Victor C.M. Leung
author_facet	Xuan Luo Zehua Wang Wei Cai Xiuhua Li Victor C.M. Leung
author_sort	Xuan Luo
title	Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
title_short	Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
title_full	Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
title_fullStr	Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
title_full_unstemmed	Application and evaluation of payment channel in hybrid decentralized ethereum token exchange
title_sort	application and evaluation of payment channel in hybrid decentralized ethereum token exchange
publisher	Elsevier
publishDate	2020
url	https://doaj.org/article/c347cbfa40474113a8e77d68a2eee7fd
work_keys_str_mv	AT xuanluo applicationandevaluationofpaymentchannelinhybriddecentralizedethereumtokenexchange AT zehuawang applicationandevaluationofpaymentchannelinhybriddecentralizedethereumtokenexchange AT weicai applicationandevaluationofpaymentchannelinhybriddecentralizedethereumtokenexchange AT xiuhuali applicationandevaluationofpaymentchannelinhybriddecentralizedethereumtokenexchange AT victorcmleung applicationandevaluationofpaymentchannelinhybriddecentralizedethereumtokenexchange
_version_	1718445299548028928

Application and evaluation of payment channel in hybrid decentralized ethereum token exchange

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