FedChain: Secure Proof-of-Stake-based Framework for Federated-blockchain Systems

TL;DR

FedChain introduces a secure, decentralized framework for cross-chain token transfer using a novel PoS consensus and game-theoretic analysis to optimize stakeholder benefits and system security.

Contribution

The paper presents a new federated-blockchain framework with a PoS consensus mechanism and a Stackelberg game model to address security, decentralization, and performance challenges.

Findings

FedChain enables secure cross-chain token transfers.

The PoS consensus improves security and performance.

Game-theoretic analysis guides optimal policy design.

Abstract

In this paper, we propose FedChain, a novel framework for federated-blockchain systems, to enable effective transferring of tokens between different blockchain networks. Particularly, we first introduce a federated-blockchain system together with a cross-chain transfer protocol to facilitate the secure and decentralized transfer of tokens between chains. We then develop a novel PoS-based consensus mechanism for FedChain, which can satisfy strict security requirements, prevent various blockchain-specific attacks, and achieve a more desirable performance compared to those of other existing consensus mechanisms. Moreover, a Stackelberg game model is developed to examine and address the problem of centralization in the FedChain system. Furthermore, the game model can enhance the security and performance of FedChain. By analyzing interactions between the stakeholders and chain operators, we can prove the uniqueness of the Stackelberg equilibrium and find the exact formula for this equilibrium. These results are especially important for the stakeholders to determine their best investment strategies and for the chain operators to design the optimal policy to maximize their benefits and security protection for FedChain. Simulations results then clearly show that the FedChain framework can help stakeholders to maximize their profits and the chain operators to design appropriate parameters to enhance FedChain's security and performance.