Transaction Propagation on Permissionless Blockchains: Incentive and Routing Mechanisms
Oguzhan Ersoy, Zhijie Ren, Zekeriya Erkin, Reginald L. Lagendijk

TL;DR
This paper addresses the lack of incentives in permissionless blockchain transaction propagation by proposing a fee-sharing incentive mechanism and an efficient routing method that reduces redundant transmissions and costs.
Contribution
It introduces a Sybil-proof incentive scheme for transaction propagation and a generic routing mechanism that minimizes communication overhead in blockchain networks.
Findings
Incentive mechanism ensures rational nodes are motivated to propagate transactions.
Routing reduces propagation redundancy from network size to average shortest path length.
The combined approach enhances sustainability and efficiency of permissionless blockchains.
Abstract
Existing permissionless blockchain solutions rely on peer-to-peer propagation mechanisms, where nodes in a network transfer transaction they received to their neighbors. Unfortunately, there is no explicit incentive for such transaction propagation. Therefore, existing propagation mechanisms will not be sustainable in a fully decentralized blockchain with rational nodes. In this work, we formally define the problem of incentivizing nodes for transaction propagation. We propose an incentive mechanism where each node involved in the propagation of a transaction receives a share of the transaction fee. We also show that our proposal is Sybil-proof. Furthermore, we combine the incentive mechanism with smart routing to reduce the communication and storage costs at the same time. The proposed routing mechanism reduces the redundant transaction propagation from the size of the network to a…
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Taxonomy
TopicsBlockchain Technology Applications and Security · Caching and Content Delivery · Peer-to-Peer Network Technologies
