Censorship Resistance in On-Chain Auctions

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dc.citation.journalTitleLeibniz International Proceedings in Informaticsen_US
dc.citation.volumeNumber282en_US
dc.contributor.authorFox, Elijahen_US
dc.contributor.authorPai, Mallesh M.en_US
dc.contributor.authorResnick, Maxen_US
dc.date.accessioned2024-05-03T15:51:02Zen_US
dc.date.available2024-05-03T15:51:02Zen_US
dc.date.issued2023en_US
dc.description.abstractModern blockchains guarantee that submitted transactions will be included eventually; a property formally known as liveness. But financial activity requires transactions to be included in a timely manner. Classical liveness does not guarantee this, particularly in the presence of a motivated adversary who benefits from censoring transactions. We define censorship resistance as the amount it would cost the adversary to censor a transaction for a fixed interval of time as a function of the associated tip. This definition has two advantages, first it captures the fact that transactions with a higher miner tip can be more costly to censor, and therefore are more likely to swiftly make their way onto the chain. Second, it applies to a finite time window, so it can be used to assess whether a blockchain is capable of hosting financial activity that relies on timely inclusion. We apply this definition in the context of auctions. Auctions are a building block for many financial applications, and censoring competing bids offers an easy-to-model motivation for our adversary. Traditional proof-of-stake blockchains have poor enough censorship resistance that it is difficult to retain the integrity of an auction when bids can only be submitted in a single block. As the number of bidders n in a single block auction increases, the probability that the winner is not the adversary, and the economic efficiency of the auction, both decrease faster than 1/n. Running the auction over multiple blocks, each with a different proposer, alleviates the problem only if the number of blocks grows faster than the number of bidders. We argue that blockchains with more than one concurrent proposer can have strong censorship resistance. We achieve this by setting up a prisoner’s dilemma among the proposers using conditional tips.en_US
dc.identifier.citationElijah Fox, Mallesh M. Pai, and Max Resnick. Censorship Resistance in On-Chain Auctions. In 5th Conference on Advances in Financial Technologies (AFT 2023). Leibniz International Proceedings in Informatics (LIPIcs), Volume 282, pp. 19:1-19:20, Schloss Dagstuhl – Leibniz-Zentrum für Informatik (2023) https://doi.org/10.4230/LIPIcs.AFT.2023.19en_US
dc.identifier.digitalLIPIcs-AFT-2023-19en_US
dc.identifier.doihttps://doi.org/10.4230/LIPIcs.AFT.2023.19en_US
dc.identifier.urihttps://hdl.handle.net/1911/115509en_US
dc.language.isoengen_US
dc.publisherSchloss Dagstuhl – Leibniz-Zentrum für Informatiken_US
dc.rightsExcept where otherwise noted, this work is licensed under a Creative Commons Attribution (CC BY) license. Permission to reuse, publish, or reproduce the work beyond the terms of the license or beyond the bounds of fair use or other exemptions to copyright law must be obtained from the copyright holder.en_US
dc.rights.urihttps://creativecommons.org/licenses/by/4.0/en_US
dc.titleCensorship Resistance in On-Chain Auctionsen_US
dc.typeJournal articleen_US
dc.type.dcmiTexten_US
dc.type.publicationpublisher versionen_US
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