Paper 2022/546

He-HTLC: Revisiting Incentives in HTLC

Sarisht Wadhwa, Jannis Stoeter, Fan Zhang, and Kartik Nayak


Hashed Time-Locked Contracts (HTLCs) are a widely used primitive in blockchain systems. Unfortunately, HTLC is incentive-incompatible and is vulnerable to bribery attacks. MAD-HTLC (Oakland'21) is an elegant solution aiming to address the incentive incompatibility of HTLC. In this paper, we show that MAD-HTLC is also incentive-incompatible. The crux of the issue is that MAD-HTLC only considers passively rational miners. We argue that such a model fails to capture active rational behaviors. We demonstrate the importance of taking actively rational behaviors into consideration by showing three novel reverse-bribery attacks against MAD-HTLC that can be implemented using Trusted Execution Environments (TEEs) or zero-knowledge proofs (ZKPs). We further show that reverse bribery can be combined with original delaying attacks to render MAD-HTLC insecure regardless of the relationship between collateral and deposit. Based on the learnings from our attacks, we devise a new smart contract specification, He-HTLC, which is lightweight and inert to incentive manipulation attacks. HE-HTLC, according to us, is the first specification to meet the HTLC specification even in the presence of actively rational miners.

Available format(s)
Cryptographic protocols
Publication info
Preprint. MINOR revision.
fair exchangeblockchainsHTLC
Contact author(s)
sarisht wadhwa @ duke edu
fan zhang @ duke edu
kartik @ cs duke edu
jannis stoeter @ alumni duke edu
2022-05-20: last of 2 revisions
2022-05-10: received
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      author = {Sarisht Wadhwa and Jannis Stoeter and Fan Zhang and Kartik Nayak},
      title = {He-HTLC: Revisiting Incentives in HTLC},
      howpublished = {Cryptology ePrint Archive, Paper 2022/546},
      year = {2022},
      note = {\url{}},
      url = {}
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