Paper 2025/180

On the Atomicity and Efficiency of Blockchain Payment Channels

Abstract

Payment channels have emerged as a promising solution to address the performance limitations of cryptocurrencies payments, enabling efficient off-chain transactions while maintaining security guarantees. However, existing payment channel protocols, including the widely-deployed Lightning Network and the state-of-the-art Sleepy Channels, suffer from a fundamental vulnerability: non-atomic state transitions create race conditions that can lead to unexpected financial losses. We first formalize current protocols into a common paradigm and prove that this vulnerability is fundamental—any protocol following this paradigm cannot guarantee balance security due to the inherent race conditions in their design. To address this limitation, we propose a novel atomic paradigm for payment channels that ensures atomic state transitions, effectively eliminating race conditions while maintaining all desired functionalities. Based on this paradigm, we introduce Ultraviolet, a secure and efficient payment channel protocol that achieves both atomicity and high performance, while avoiding the introduction of unimplemented Bitcoin features. Ultraviolet reduces the number of required messages per transaction by half compared to existing solutions, while maintaining comparable throughput. We formally prove the security of Ultraviolet under the universal composability framework and demonstrate its practical efficiency through extensive evaluations across multiple regions. This results in a 37% and 52% reduction in latency compared to the Lightning Network and Sleepy Channels, respectively. Regarding throughput, Ultraviolet achieves performance comparable to the Lightning Network and delivers 2× the TPS of Sleepy Channels.