zk-PCN: A Privacy-Preserving Payment Channel Network Using zk-SNARKs

TL;DR

zk-PCN introduces a privacy-preserving payment channel network using zk-SNARKs, balancing privacy with transaction success rates and compatibility with existing routing algorithms, supported by extensive simulations.

Contribution

The paper proposes zk-PCN, a novel privacy-preserving payment channel network leveraging zk-SNARKs, and introduces zk-IPCN with a new proof generation algorithm to enhance efficiency.

Findings

High transaction success rates achieved with privacy guarantees.

Reduced overheads in storing channel info and proof generation.

Effective performance demonstrated through extensive simulations.

Abstract

Payment channel network (PCN) is a layer-two scaling solution that enables fast off-chain transactions but does not involve on-chain transaction settlement. PCNs raise new privacy issues including balance secrecy, relationship anonymity and payment privacy. Moreover, protecting privacy causes low transaction success rates. To address this dilemma, we propose zk-PCN, a privacy-preserving payment channel network using zk-SNARKs. We prevent from exposing true balances by setting up \textit{public balances} instead. Using public balances, zk-PCN can guarantee high transaction success rates and protect PCN privacy with zero-knowledge proofs. Additionally, zk-PCN is compatible with the existing routing algorithms of PCNs. To support such compatibility, we propose zk-IPCN to improve zk-PCN with a novel proof generation (RPG) algorithm. zk-IPCN reduces the overheads of storing channel information and lowers the frequency of generating zero-knowledge proofs. Finally, extensive simulations demonstrate the effectiveness and efficiency of zk-PCN in various settings.