Paper 2020/555

Splitting Payments Locally While Routing Interdimensionally

Abstract

Payment Channel Networks (PCNs) enable fast, scalable, and cheap payments by moving transactions off-chain, thereby overcoming debilitating drawbacks of blockchains. However, current algorithms exhibit frequent payment failures when a payment is routed via multiple intermediaries. One of the key challenges for designing PCNs is to drastically reduce this failure rate. In this paper, we design a Bitcoin-compatible protocol that allows intermediaries to split payments on the path. Intermediaries can thus easily adapt the routing to the local conditions, of which the sender is unaware. Our protocol provides both termination and atomicity of payments and provably guarantees that no participant loses funds even in the presence of malicious parties. An extended version of our basic protocol further provides unlinkability between two partial payments belonging to the same transaction, which – as we argue – is important to guarantee the success of split payments. Besides formally modeling and proving the security of our construction, we conducted an in-depth simulation-based evaluation of various routing algorithms and splitting methods. Concretely, we present Interdimensional SpeedyMurmurs, a modification of the SpeedyMurmurs protocol that increases the flexibility of the route choice combined with splitting. Even in the absence of splitting, Interdimensional SpeedyMurmurs increases the success ratio of transactions drastically in comparison to a Lightning-style protocol by close to 50%.

Note: We expanded the performance evaluation by including a comparison to Spider and Boomerang. We now also consider concurrency in our simulations and the paper includes a simulation of the discussed linkability attack.