ZeroAuction: Zero-Deposit Sealed-bid Auction via Delayed Execution
Haoqian Zhang, Michelle Yeo, Vero Estrada-Galinanes, and Bryan Ford
8th Workshop on Trusted Smart Contracts (WTSC)
March 8, 2024
Abstract:
Auctions, a long-standing method of trading goods and services, are a
promising use case for decentralized finance. However, due to the inherent
transparency property of blockchains, current sealed-bid auction
implementations on smart contracts requires a bidder to send at least two
transactions to the underlying blockchain: a bidder must first commit their bid
in the first transaction during the bidding period and reveal their bid in
the second transaction once the revealing period starts. In addition, the smart
contract often requires a deposit to incentivize bidders to reveal their bids,
rendering unnecessary financial burdens and risks to bidders. We address these
drawbacks by enforcing delayed execution in the blockchain execution layer to
all transactions. In short, the blockchain only accepts encrypted transactions,
and when the blockchain has finalized an encrypted transaction, the consensus
group decrypts and executes it. This architecture enables ZeroAuction, a
sealed-bid auction smart contract with zero deposit requirement. ZeroAuction
relies on the blockchain enhanced with delayed execution to hide and bind the
bids within the encrypted transactions and, after a delay period, reveals them
automatically by decrypting and executing the transactions. Because a bidder
only needs to interact with the blockchain once instead of two times to
participate in the auction, ZeroAuction significantly reduces the latency
overhead along with eliminating the deposit requirement.
Slides:
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