Ranjan Pal

Chien-Lun Chen, Leana Golubchik, Ranjan Pal

An accountable algorithmic transparency report (ATR) should ideally investigate the (a) transparency of the underlying algorithm, and (b) fairness of the algorithmic decisions, and at the same time preserve data subjects' privacy. However, a provably formal study of the impact to data subjects' privacy caused by the utility of releasing an ATR (that investigates transparency and fairness), is yet to be addressed in the literature. The far-fetched benefit of such a study lies in the methodical characterization of privacy-utility trade-offs for release of ATRs in public, and their consequential application-specific impact on the dimensions of society, politics, and economics. In this paper, we first investigate and demonstrate potential privacy hazards brought on by the deployment of transparency and fairness measures in released ATRs. To preserve data subjects' privacy, we then propose a linear-time optimal-privacy scheme, built upon standard linear fractional programming (LFP) theory, for announcing ATRs, subject to constraints controlling the tolerance of privacy perturbation on the utility of transparency schemes. Subsequently, we quantify the privacy-utility trade-offs induced by our scheme, and analyze the impact of privacy perturbation on fairness measures in ATRs. To the best of our knowledge, this is the first analytical work that simultaneously addresses trade-offs between the triad of privacy, utility, and fairness, applicable to algorithmic transparency reports.

Aditya Ahuja, Vinay J. Ribeiro, Ranjan Pal

Permissionless blockchain consensus protocols have been designed primarily for defining decentralized economies for the commercial trade of assets, both virtual and physical, using cryptocurrencies. In most instances, the assets being traded are regulated, which mandates that the legal right to their trade and their trade value are determined by the governmental regulator of the jurisdiction in which the trade occurs. Unfortunately, existing blockchains do not formally recognise proposal of legal cryptocurrency transactions, as part of the execution of their respective consensus protocols, resulting in rampant illegal activities in the associated crypto-economies. In this contribution, we motivate the need for regulated blockchain consensus protocols with a case study of the illegal, cryptocurrency based, Silk Road darknet market. We present a novel regulatory framework for blockchain protocols, for ensuring legal transaction confirmation as part of the blockchain distributed consensus. As per our regulatory framework, we derive conditions under which legal transaction throughput supersedes throughput of traditional transactions, which are, in the worst case, an indifferentiable mix of legal and illegal transactions. Finally, we show that with a small change to the standard blockchain consensus execution policy (appropriately introduced through regulation), the legal transaction throughput in the blockchain network can be maximized.

Ranjan Pal, Pan Hui

In recent years, researchers have proposed \emph{cyber-insurance} as a suitable risk-management technique for enhancing security in Internet-like distributed systems. However, amongst other factors, information asymmetry between the insurer and the insured, and the inter-dependent and correlated nature of cyber risks have contributed in a big way to the failure of cyber-insurance markets. Security experts have argued in favor of operating system (OS) platform switching (ex., from Windows to Unix-based OSs) or secure OS adoption as being one of the techniques that can potentially mitigate the problems posing a challenge to successful cyber-insurance markets. In this regard we model OS platform switching dynamics using a \emph{social gossip} mechanism and study three important questions related to the nature of the dynamics, for Internet-like distributed systems: (i) which type of networks should cyber-insurers target for insuring?, (ii) what are the bounds on the asymptotic performance level of a network, where the performance parameter is an average function of the long-run individual user willingness to adopt secure OSs?, and (iii) how can cyber-insurers use the topological information of their clients to incentivize/reward them during offering contracts? Our analysis is important to a profit-minded cyber-insurer, who wants to target the right network, design optimal contracts to resolve information asymmetry problems, and at the same time promote the increase of overall network security through increasing secure OS adoption amongst users.

Ranjan Pal

Internet users such as individuals and organizations are subject to different types of epidemic risks such as worms, viruses, spams, and botnets. To reduce the probability of risk, an Internet user generally invests in traditional security mechanisms like anti-virus and anti-spam software, sometimes also known as \emph{self-defense} mechanisms. However, according to security experts, such software (and their subsequent advancements) will not completely eliminate risk. Recent research efforts have considered the problem of residual risk elimination by proposing the idea of \emph{cyber-insurance}. In this regard, an important research problem is resolving information asymmetry issues associated with cyber-insurance contracts. In this paper we propose \emph{three} mechanisms to resolve information asymmetry in cyber-insurance. Our mechanisms are based on the \emph{Principal-Agent} (PA) model in microeconomic theory. We show that (1) optimal cyber-insurance contracts induced by our mechanisms only provide partial coverage to the insureds. This ensures greater self-defense efforts on the part of the latter to protect their computing systems, which in turn increases overall network security, (2) the level of deductible per network user contract increases in a concave manner with the topological degree of the user, and (3) a market for cyber-insurance can be made to exist in the presence of monopolistic insurers under effective mechanism design. Our methodology is applicable to any distributed network scenario in which a framework for cyber-insurance can be implemented.