Using Bitcoin To Incentivize Users Of Distributed P2P Applications

The efficiency of a decentralized peer-to-peer (P2P) application is mainly determined by the effective collaboration of users of mobile devices. Each and every user should be incentivized to compensate for consumption of computing resources as he/she collaborates with other users across the P2P network. On the other hand, appropriate incentivizing mechanisms that comply with the diversified requirements of users within the context of a decentralized and dynamic P2P environment are still lacking.

A recently published paper proposed a bitcoin based incentivizing mechanism for decentralized P2P applications that applies the concept of bitcoin to reward users for collaboration with others across the network. Via this approach, users helping in performing the work will be rewarded with bitcoin. Via theoretical analysis along with a thorough evaluation study, developers of the system managed to demonstrate the efficiency and security strength of the proposed incentivizing mechanism.

P2P Decentralized Applications:

P2P decentralized applications are marked by distributed architectures that split workloads, or tasks, among peers without relying on any centralized trusted authorities. Examples of such P2P applications existing today include mobile data offloading that enable mobile users to collaboratively deliver mobile network data via exploitation of various complementary network technologies, such as WiFi, femtocell…etc; delay tolerant networking which is characterized by nodes opportunistically forwarding messages to other users via adopting a store-carry forwarding mechanism, and mobile crowdsensing where users can cooperatively upload data in order to reduce consumption of energy and cost of mobile data transmission.

The efficiency of the processes of data transfer, data collection and packet forwarding within the context of P2P applications is highly determined by the collaboration of mobile users. Selfish users are occasionally reluctant to participate in data transmissions for concerns regarding bandwidth and computing resources consumption. Accordingly, users have to be provided with sufficient incentives for cooperation. Several incentive approaches have been previously proposed and deployed such as the reputation systems, credit based incentivizing mechanisms and Tit-or-tat schemes.

An overview of the proposed bitcoin based incentivizing mechanism:

In the new model, the sender utilizes the bitcoin system to pay rewards to cooperative nodes. The payment workflow is comprised of three steps. Along the first step, the sender broadcasts a transmission task and deposits a specific amount that will be used to pay rewards to cooperative nodes. Along the second step, the sender routes data to the receiver via means of opportunistic connections. Along the third step, cooperative nodes receive their reward payments. Let’s assume that sender A sends a message m to a given receiver E and B, C and D represent the cooperative nodes who collaborate with A to route data to E. The payment workflow can be broken down into:

1. Broadcasting a transmission task: A publicizes a task A →E: m and then selects two random integers R₁and R₂ and these will be kept secret. Afterwards, A will deposit a certain amount to commit that he/she will pay the rewards to cooperative nodes, in case the message is delivered successfully; otherwise A would be paid back the deposited amount. The transcript’s transaction is illustrated in the below figure.

2. Transmission of data: Transmission of data from A to E is shown in the below figure. First, A sends the message ||E_PKe (R₂)||Ớ||Sig_SKA(R₁) to B and creates a transaction Payment_A→B. Afterwards, B, C and D cooperate with A to transmit the message ||E_PKe (R₂)||Ớ to E and creates transactions Payment_B→C, Payment_C→D and Payment_D→E, and C, D and E send the signed encrypted validation back to B, C and D.

3. Receiving the payments: After successful delivery of the data to the receiver, all cooperative nodes will receive their reward payments via providing the miners with what proves that they have participated in the process of data transmission. B will provide {E_PKB (R₁), E_PKB(ACK_C), PK_A, PK_C}, C will provide {E_PKC(ACK_C), E_PKC(ACK_D), PK_D} and D will provide {E_PKD(ACK_D), E_PKD(ACK_E), PK_E} and E will provide {R₂, E_PKE(ACK_E)}.

The transactions are verified by the miners via secure means that use commutative encryptions. The authors of the paper proposed a pricing strategy that maximizes the security of the incentivizing mechanism. They also employed a static game model that illustrated the high security level of the proposed incentivizing mechanisms.