The Smart Contract Model

TL;DR

This paper introduces a smart contract model tailored for blockchain-based distributed computing, emphasizing cross-chain protocols, Byzantine parties, and game-theoretic task formulation, highlighting differences from classical models.

Contribution

It proposes a novel smart contract model that captures blockchain-specific features and differences from classical distributed computing models, especially for cross-chain protocols.

Findings

Addresses the unique aspects of smart contracts in distributed computing.

Incorporates game-theoretic notions for Byzantine parties.

Highlights differences between classical and blockchain-based models.

Abstract

Many of the problems that arise in the context of blockchains and decentralized finance can be seen as variations on classical problems of distributed computing. The smart contract model proposed here is intended to capture both the similarities and the differences between classical and blockchain-based models of distributed computing. The focus is on cross-chain protocols in which a collection of parties, some honest and some perhaps not, interact through trusted smart contracts residing on multiple, independent ledgers. While cross-chain protocols are capable of general computations, they are primarily used to track ownership of assets such as cryptocurrencies or other valuable data. For this reason, the smart contract model differs in some essential ways from familiar models of distributed and concurrent computing. Because parties are potentially Byzantine, tasks to be solved are formulated using elementary game-theoretic notions, taking into account the utility to each party of each possible outcome. As in the classical model, the parties provide task inputs and agree on a desired sequence of proposed asset transfers. Unlike the classical model, the contracts, not the parties, determine task outputs in the form of executed asset transfers, since they alone have the power to control ownership.