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CRYPTOCURRENCY: a PRIMER Accept Bitcoin3—Including Amazon.Com, What Is Cryptocurrency? Target, Paypal, Ebay, Dell, and Home
CRYPTOCURRENCY: A PRIMER accept bitcoin3—including Amazon.com, What is cryptocurrency? Target, PayPal, eBay, Dell, and Home Depot—with anywhere from 80,000 to There is no one standard definition of 220,000 transactions occurring per day, cryptocurrency.1 At the most basic level representing over $50 million in estimated cryptocurrency—or digital currency or daily volume.4 virtual currency—is a medium of exchange that functions like money (in Cryptocurrencies allow for increased that it can be exchanged for goods and market efficiencies and reduced services) but, unlike traditional currency, transaction costs. At base, is untethered to, and independent from, cryptocurrency transactions are: national borders, central banks, sovereigns, or fiats. In other words, it . Private—no personal information is exists completely in the virtual world, required to complete a transaction;5 traded on multiple global platforms. These currencies are designed to . Fast—they are settled almost incorporate and exchange digital instantaneously, unlike credit card information through a process made transactions or wire transfers that possible by principles of cryptography, require days; which makes transactions secure and . Irrevocable—because transactions are verifiable. The most well-known settled almost immediately, there are cryptocurrency is bitcoin, which was no resulting chargebacks or possibility created back in 2009 and which still for disputes between buyer and seller; dominates the virtual currency market today.2 . Inexpensive—transaction costs are generally less than 1% if an intermediary is used, rather than the Why do they matter? customary credit card processing fee of roughly 2.5%; and Cryptocurrency is relevant to most . Global—neither buyer nor seller businesses and financial firms. -
Chia Proof of Space Construction
Chia Proof of Space Construction Introduction In order to create a secure blockchain consensus algorithm using disk space, a Proof of Space is scheme is necessary. This document describes a practical contruction of Proofs of Space, based on Beyond Hellman’s Time- Memory Trade-Offs with Applications to Proofs of Space [1]. We use the techniques laid out in that paper, extend it from 2 to 7 tables, and tweak it to make it efficient and secure, for use in the Chia Blockchain. The document is divided into three main sections: What (mathematical definition of a proof of space), How (how to implement proof of space), and Why (motivation and explanation of the construction) sections. The Beyond Hellman paper can be read first for more mathematical background. Chia Proof of Space Construction Introduction What is Proof of Space? Definitions Proof format Proof Quality String Definition of parameters, and M, f, A, C functions: Parameters: f functions: Matching function M: A′ function: At function: Collation function C: How do we implement Proof of Space? Plotting Plotting Tables (Concepts) Tables Table Positions Compressing Entry Data Delta Format ANS Encoding of Delta Formatted Points Stub and Small Deltas Parks Checkpoint Tables Plotting Algorithm Final Disk Format Full algorithm Phase 1: Forward Propagation Phase 2: Backpropagation Phase 3: Compression Phase 4: Checkpoints Sort on Disk Plotting Performance Space Required Proving Proof ordering vs Plot ordering Proof Retrieval Quality String Retrieval Proving Performance Verification Construction -
IPFS and Friends: a Qualitative Comparison of Next Generation Peer-To-Peer Data Networks Erik Daniel and Florian Tschorsch
1 IPFS and Friends: A Qualitative Comparison of Next Generation Peer-to-Peer Data Networks Erik Daniel and Florian Tschorsch Abstract—Decentralized, distributed storage offers a way to types of files [1]. Napster and Gnutella marked the beginning reduce the impact of data silos as often fostered by centralized and were followed by many other P2P networks focusing on cloud storage. While the intentions of this trend are not new, the specialized application areas or novel network structures. For topic gained traction due to technological advancements, most notably blockchain networks. As a consequence, we observe that example, Freenet [2] realizes anonymous storage and retrieval. a new generation of peer-to-peer data networks emerges. In this Chord [3], CAN [4], and Pastry [5] provide protocols to survey paper, we therefore provide a technical overview of the maintain a structured overlay network topology. In particular, next generation data networks. We use select data networks to BitTorrent [6] received a lot of attention from both users and introduce general concepts and to emphasize new developments. the research community. BitTorrent introduced an incentive Specifically, we provide a deeper outline of the Interplanetary File System and a general overview of Swarm, the Hypercore Pro- mechanism to achieve Pareto efficiency, trying to improve tocol, SAFE, Storj, and Arweave. We identify common building network utilization achieving a higher level of robustness. We blocks and provide a qualitative comparison. From the overview, consider networks such as Napster, Gnutella, Freenet, BitTor- we derive future challenges and research goals concerning data rent, and many more as first generation P2P data networks, networks. -
Evaluating Inclusion, Equality, Security, and Privacy in Pseudonym Parties and Other Proofs of Personhood
Identity and Personhood in Digital Democracy: Evaluating Inclusion, Equality, Security, and Privacy in Pseudonym Parties and Other Proofs of Personhood Bryan Ford Swiss Federal Institute of Technology in Lausanne (EPFL) November 5, 2020 Abstract of enforced physical security and privacy can address the coercion and vote-buying risks that plague today’s E- Digital identity seems at first like a prerequisite for digi- voting and postal voting systems alike. We also examine tal democracy: how can we ensure “one person, one vote” other recently-proposed approaches to proof of person- online without identifying voters? But the full gamut of hood, some of which offer conveniencessuch as all-online digital identity solutions – e.g., online ID checking, bio- participation. These alternatives currently fall short of sat- metrics, self-sovereign identity, and social/trust networks isfying all the key digital personhood goals, unfortunately, – all present severe flaws in security, privacy, and trans- but offer valuable insights into the challenges we face. parency, leaving users vulnerable to exclusion, identity loss or theft, and coercion. These flaws may be insur- mountable because digital identity is a cart pulling the Contents horse. We cannot achieve digital identity secure enough to support the weight of digital democracy, until we can 1 Introduction 2 build it on a solid foundation of digital personhood meet- ing key requirements. While identity is about distinguish- 2 Goals for Digital Personhood 4 ing one person from another through attributes or affilia- tions, personhood is about giving all real people inalien- 3 Pseudonym Parties 5 able digital participation rights independent of identity, 3.1 Thebasicidea. -
Asymmetric Proof-Of-Work Based on the Generalized Birthday Problem
Equihash: Asymmetric Proof-of-Work Based on the Generalized Birthday Problem Alex Biryukov Dmitry Khovratovich University of Luxembourg University of Luxembourg [email protected] [email protected] Abstract—The proof-of-work is a central concept in modern Long before the rise of Bitcoin it was realized [20] that cryptocurrencies and denial-of-service protection tools, but the the dedicated hardware can produce a proof-of-work much requirement for fast verification so far made it an easy prey for faster and cheaper than a regular desktop or laptop. Thus the GPU-, ASIC-, and botnet-equipped users. The attempts to rely on users equipped with such hardware have an advantage over memory-intensive computations in order to remedy the disparity others, which eventually led the Bitcoin mining to concentrate between architectures have resulted in slow or broken schemes. in a few hardware farms of enormous size and high electricity In this paper we solve this open problem and show how to consumption. An advantage of the same order of magnitude construct an asymmetric proof-of-work (PoW) based on a compu- is given to “owners” of large botnets, which nowadays often tationally hard problem, which requires a lot of memory to gen- accommodate hundreds of thousands of machines. For prac- erate a proof (called ”memory-hardness” feature) but is instant tical DoS protection, this means that the early TLS puzzle to verify. Our primary proposal Equihash is a PoW based on the schemes [8], [17] are no longer effective against the most generalized birthday problem and enhanced Wagner’s algorithm powerful adversaries. -
Lab 5: Bittorrent Client Implementation
Lab 5: BitTorrent Client Implementation Due: Nov. 30th at 11:59 PM Milestone: Nov. 19th during Lab Overview In this lab, you and your lab parterner will develop a basic BitTorrent client that can, at minimal, exchange a file between multiple peers, and at best, function as a full feature BitTorrent Client. The programming in this assignment will be in C requiring standard sockets, and thus you will not need to have root access. You should be able to develop your code on any CS lab machine or your personal machine, but all code will be tested on the CS lab. Deliverable Your submission should minimally include the following programs and files: • REDME • Makefile • bencode.c|h • bt lib.c|h • bt setup.c|h • bt client • client trace.[n].log • sample torrent.torrent Your README file should contain a short header containing your name, username, and the assignment title. The README should additionally contain a short description of your code, tasks accomplished, and how to compile, execute, and interpret the output of your programs. Your README should also contain a list of all submitted files and code and the functionality implemented in different code files. This is a large assignment, and this will greatly aid in grading. As always, if there are any short answer questions in this lab write-up, you should provide well marked answers in the README, as well as indicate that you’ve completed any of the extra credit (so that I don’t forget to grade it). Milestones The entire assignment will be submitted and graded, but your group will also hold a milestone meeting to receive feedback on your current implementation. -
Virtual Currency
Office of Legislative Research Research Report December 12, 2014 2014-R-0290 BITCOINS - VIRTUAL CURRENCY By: Michelle Kirby, Associate Analyst ISSUE BITCOINS The use of bitcoins as virtual currency, the laws that Bitcoin is a form of virtual or digital currency. It is govern it, and other states’ attempts to regulate it. not legal tender and is not backed by any This report updates OLR Report 2014-R-0050. government. Federal agencies such as SUMMARY the U.S. Treasury “Bitcoin” is a form of virtual or digital currency, that Department, the Government Accountability allows financial transactions to be conducted on a Office, the Internal network using computer codes. It is a form of Revenue Service, and the exchange that operates like a currency but does not Congressional Research Services have issued have all the attributes of real currency. guidance on how existing laws apply to virtual There are no federal or state laws that specifically currency activities. govern bitcoins. However, many existing laws apply to A proposed federal law certain virtual currency activities. calls for a five-year moratorium on bitcoin The U.S. Treasury Department’s Financial Crimes regulation. Enforcement Network (FinCEN) has provided guidance New York has proposed indicating that, under federal law, a virtual currency regulation that would, user is not a money transmitter and is therefore not among other things, subject to the registration, reporting, and require firms engaged in virtual currency to have a recordkeeping regulations for money services BitLicense. businesses (MSBs). However, virtual currency California has enacted a administrators and exchangers may be regulated as law that allows the use of money transmitters but should not be considered alternative currency. -
A Decentralized Cloud Storage Network Framework
Storj: A Decentralized Cloud Storage Network Framework Storj Labs, Inc. October 30, 2018 v3.0 https://github.com/storj/whitepaper 2 Copyright © 2018 Storj Labs, Inc. and Subsidiaries This work is licensed under a Creative Commons Attribution-ShareAlike 3.0 license (CC BY-SA 3.0). All product names, logos, and brands used or cited in this document are property of their respective own- ers. All company, product, and service names used herein are for identification purposes only. Use of these names, logos, and brands does not imply endorsement. Contents 0.1 Abstract 6 0.2 Contributors 6 1 Introduction ...................................................7 2 Storj design constraints .......................................9 2.1 Security and privacy 9 2.2 Decentralization 9 2.3 Marketplace and economics 10 2.4 Amazon S3 compatibility 12 2.5 Durability, device failure, and churn 12 2.6 Latency 13 2.7 Bandwidth 14 2.8 Object size 15 2.9 Byzantine fault tolerance 15 2.10 Coordination avoidance 16 3 Framework ................................................... 18 3.1 Framework overview 18 3.2 Storage nodes 19 3.3 Peer-to-peer communication and discovery 19 3.4 Redundancy 19 3.5 Metadata 23 3.6 Encryption 24 3.7 Audits and reputation 25 3.8 Data repair 25 3.9 Payments 26 4 4 Concrete implementation .................................... 27 4.1 Definitions 27 4.2 Peer classes 30 4.3 Storage node 31 4.4 Node identity 32 4.5 Peer-to-peer communication 33 4.6 Node discovery 33 4.7 Redundancy 35 4.8 Structured file storage 36 4.9 Metadata 39 4.10 Satellite 41 4.11 Encryption 42 4.12 Authorization 43 4.13 Audits 44 4.14 Data repair 45 4.15 Storage node reputation 47 4.16 Payments 49 4.17 Bandwidth allocation 50 4.18 Satellite reputation 53 4.19 Garbage collection 53 4.20 Uplink 54 4.21 Quality control and branding 55 5 Walkthroughs ............................................... -
Virtual Currencies: Growing Regulatory Framework and Challenges in the Emerging Fintech Ecosystem V
View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by University of North Carolina School of Law NORTH CAROLINA BANKING INSTITUTE Volume 21 | Issue 1 Article 10 3-1-2017 Virtual Currencies: Growing Regulatory Framework and Challenges in the Emerging Fintech Ecosystem V. Gerard Comizio Follow this and additional works at: http://scholarship.law.unc.edu/ncbi Part of the Banking and Finance Law Commons Recommended Citation V. G. Comizio, Virtual Currencies: Growing Regulatory Framework and Challenges in the Emerging Fintech Ecosystem, 21 N.C. Banking Inst. 131 (2017). Available at: http://scholarship.law.unc.edu/ncbi/vol21/iss1/10 This Article is brought to you for free and open access by Carolina Law Scholarship Repository. It has been accepted for inclusion in North Carolina Banking Institute by an authorized editor of Carolina Law Scholarship Repository. For more information, please contact [email protected]. VIRTUAL CURRENCIES: GROWING REGULATORY FRAMEWORK AND CHALLENGES IN THE EMERGING FINTECH ECOSYSTEM V. GERARD COMIZIO* I. INTRODUCTION In the context of a widely publicized explosion of new technology and innovation designed to disrupt the marketplace of traditional financial institutions in delivering financial services, the number of financial technology (“fintech”) companies in the United States and United Kingdom alone has grown to more than 4,000 in recent years. Further, investment in this sector has grown from $1.8 billion to $24 billion worldwide in just the last five years.1 The financial services industry is experiencing rapid technological changes as it seeks to meet and anticipate business opportunities and needs, consumer demands and expectations, and demographic trends. -
Sok: Tools for Game Theoretic Models of Security for Cryptocurrencies
SoK: Tools for Game Theoretic Models of Security for Cryptocurrencies Sarah Azouvi Alexander Hicks Protocol Labs University College London University College London Abstract form of mining rewards, suggesting that they could be prop- erly aligned and avoid traditional failures. Unfortunately, Cryptocurrencies have garnered much attention in recent many attacks related to incentives have nonetheless been years, both from the academic community and industry. One found for many cryptocurrencies [45, 46, 103], due to the interesting aspect of cryptocurrencies is their explicit consid- use of lacking models. While many papers aim to consider eration of incentives at the protocol level, which has motivated both standard security and game theoretic guarantees, the vast a large body of work, yet many open problems still exist and majority end up considering them separately despite their current systems rarely deal with incentive related problems relation in practice. well. This issue arises due to the gap between Cryptography Here, we consider the ways in which models in Cryptog- and Distributed Systems security, which deals with traditional raphy and Distributed Systems (DS) can explicitly consider security problems that ignore the explicit consideration of in- game theoretic properties and incorporated into a system, centives, and Game Theory, which deals best with situations looking at requirements based on existing cryptocurrencies. involving incentives. With this work, we offer a systemati- zation of the work that relates to this problem, considering papers that blend Game Theory with Cryptography or Dis- Methodology tributed systems. This gives an overview of the available tools, and we look at their (potential) use in practice, in the context As we are covering a topic that incorporates many different of existing blockchain based systems that have been proposed fields coming up with an extensive list of papers would have or implemented. -
Blockchain and The
NOTES ACKNOWLEDGMENTS INDEX Notes Introduction 1. The manifesto dates back to 1988. See Timothy May, “The Crypto Anarchist Manifesto” (1992), https:// www . activism . net / cypherpunk / crypto - anarchy . html. 2. Ibid. 3. Ibid. 4. Ibid. 5. Ibid. 6. Timothy May, “Crypto Anarchy and Virtual Communities” (1994), http:// groups . csail . mit . edu / mac / classes / 6 . 805 / articles / crypto / cypherpunks / may - virtual - comm . html. 7. Ibid. 8. For example, as we wi ll describe in more detail in Chapter 1, the Bitcoin blockchain is currently stored on over 6,000 computers in eighty- nine jurisdictions. See “Global Bitcoin Node Distribution,” Bitnodes, 21 . co, https:// bitnodes . 21 . co / . Another large blockchain- based network, Ethereum, has over 12,000 nodes, also scattered across the globe. See Ethernodes, https:// www . ethernodes . org / network / 1. 9. See note 8. 10. Some blockchains are not publicly accessible (for more on this, see Chapter 1). These blockchains are referred to as “private blockchains” and are not the focus of this book. 11. See Chapter 1. 12. The Eu ro pean Securities and Market Authority, “Discussion Paper: The Dis- tributed Ledger Technology Applied to Securities Markets,” ESMA / 2016 / 773, June 2, 2016: at 17, https:// www . esma . europa . eu / sites / default / files / library / 2016 - 773 _ dp _ dlt . pdf. 213 214 NOTES TO PAGES 5–13 13. The phenomena of order without law also has been described in other con- texts, most notably by Robert Ellickson in his seminal work Order without Law (Cambridge, MA: Harvard University Press, 1994). 14. Joel Reidenberg has used the term “lex informatica” to describe rules imple- mented by centralized operators online. -
Proofs of Replication Are Also Relevant in the Private-Verifier Setting of Proofs of Data Replication
PoReps: Proofs of Space on Useful Data Ben Fisch Stanford University, Protocol Labs Abstract A proof-of-replication (PoRep) is an interactive proof system in which a prover defends a publicly verifiable claim that it is dedicating unique resources to storing one or more retrievable replicas of a data file. In this sense a PoRep is both a proof of space (PoS) and a proof of retrievability (PoR). This paper establishes a foundation for PoReps, exploring both their capabilities and their limitations. While PoReps may unconditionally demonstrate possession of data, they fundamentally cannot guarantee that the data is stored redundantly. Furthermore, as PoReps are proofs of space, they must rely either on rational time/space tradeoffs or timing bounds on the online prover's runtime. We introduce a rational security notion for PoReps called -rational replication based on the notion of an -Nash equilibrium, which captures the property that a server does not gain any significant advantage by storing its data in any other (non-redundant) format. We apply our definitions to formally analyze two recently proposed PoRep constructions based on verifiable delay functions and depth robust graphs. Lastly, we reflect on a notable application of PoReps|its unique suitability as a Nakamoto consensus mechanism that replaces proof-of-work with PoReps on real data, simultaneously incentivizing and subsidizing the cost of file storage. 1 Introduction A proof-of-replication (PoRep) builds on the two prior concepts of proofs-of-retrievability (PoR) [30] and proofs-of-space (PoS) [24]. In the former a prover demonstrates that it can retrieve a file and in the latter the prover demonstrates that it is using some minimum amount of space to store information.