Hide & Seek: Privacy-preserving rebalancing on payment channel networks

conference paper Hide & Seek: Privacy-preserving rebalancing on payment channel networks LNCS published yes Georgia Avarikioti author c20482a0-3b89-11eb-9862-88cf6404b88c Krzysztof Z Pietrzak author 3E04A7AA-F248-11E8-B48F-1D18A9856A870000-0002-9139-1654 Iosif Salem author Stefan Schmid author Samarth Tiwari author Michelle X Yeo author 2D82B818-F248-11E8-B48F-1D18A9856A870009-0001-3676-4809 KrPi department FC: Financial Cryptography and Data Security Payment channels effectively move the transaction load off-chain thereby successfully addressing the inherent scalability problem most cryptocurrencies face. A major drawback of payment channels is the need to “top up” funds on-chain when a channel is depleted. Rebalancing was proposed to alleviate this issue, where parties with depleting channels move their funds along a cycle to replenish their channels off-chain. Protocols for rebalancing so far either introduce local solutions or compromise privacy. In this work, we present an opt-in rebalancing protocol that is both private and globally optimal, meaning our protocol maximizes the total amount of rebalanced funds. We study rebalancing from the framework of linear programming. To obtain full privacy guarantees, we leverage multi-party computation in solving the linear program, which is executed by selected participants to maintain efficiency. Finally, we efficiently decompose the rebalancing solution into incentive-compatible cycles which conserve user balances when executed atomically. Springer Nature2022Grenada eng Financial Cryptography and Data Security 0302-9743 1611-3349 9783031182822 2110.08848 00142364020001710.1007/978-3-031-18283-9_17 13411358-373 Avarikioti G, Pietrzak KZ, Salem I, Schmid S, Tiwari S, Yeo MX. 2022. Hide & Seek: Privacy-preserving rebalancing on payment channel networks. Financial Cryptography and Data Security. FC: Financial Cryptography and Data Security, LNCS, vol. 13411, 358–373. Avarikioti G, Pietrzak KZ, Salem I, Schmid S, Tiwari S, Yeo MX. Hide & Seek: Privacy-preserving rebalancing on payment channel networks. In: Financial Cryptography and Data Security. Vol 13411. Springer Nature; 2022:358-373. doi:<a href="https://doi.org/10.1007/978-3-031-18283-9_17">10.1007/978-3-031-18283-9_17</a> Avarikioti, Georgia, et al. “Hide & Seek: Privacy-Preserving Rebalancing on Payment Channel Networks.” Financial Cryptography and Data Security, vol. 13411, Springer Nature, 2022, pp. 358–73, doi:<a href="https://doi.org/10.1007/978-3-031-18283-9_17">10.1007/978-3-031-18283-9_17</a>. G. Avarikioti, K. Z. Pietrzak, I. Salem, S. Schmid, S. Tiwari, and M. X. Yeo, “Hide & Seek: Privacy-preserving rebalancing on payment channel networks,” in Financial Cryptography and Data Security, Grenada, 2022, vol. 13411, pp. 358–373. Avarikioti, Georgia, Krzysztof Z Pietrzak, Iosif Salem, Stefan Schmid, Samarth Tiwari, and Michelle X Yeo. “Hide & Seek: Privacy-Preserving Rebalancing on Payment Channel Networks.” In Financial Cryptography and Data Security, 13411:358–73. Springer Nature, 2022. <a href="https://doi.org/10.1007/978-3-031-18283-9_17">https://doi.org/10.1007/978-3-031-18283-9_17</a>. Avarikioti, G., Pietrzak, K. Z., Salem, I., Schmid, S., Tiwari, S., & Yeo, M. X. (2022). Hide & Seek: Privacy-preserving rebalancing on payment channel networks. In Financial Cryptography and Data Security (Vol. 13411, pp. 358–373). Grenada: Springer Nature. <a href="https://doi.org/10.1007/978-3-031-18283-9_17">https://doi.org/10.1007/978-3-031-18283-9_17</a> G. Avarikioti, K.Z. Pietrzak, I. Salem, S. Schmid, S. Tiwari, M.X. Yeo, in:, Financial Cryptography and Data Security, Springer Nature, 2022, pp. 358–373. 121672023-01-12T12:10:38Z2025-09-10T09:48:15Z