Multi-Party Timed Commitments
This addresses the problem of secure and fair multi-party commitments for applications like sealed-bid auctions and decentralized systems, offering a novel solution to frontrunning in blockchains.
The paper tackles the problem of obtaining secret commitments from multiple parties with a probabilistic delay, formalizing it as Multi-Party Timed Commitments (MPTC) and presenting the Time-Capsule protocol, which prevents any party from having an advantage in solving the puzzle and ensures individual commitments cannot be revealed early, with an application to blockchain systems that prevents frontrunning by tuning puzzle difficulty.
The problem of obtaining secret commitments from multiple parties and revealing them after a certain time is useful for sealed-bid auctions, games, and other applications. Existing solutions, dating back to Rivest, Shamir and Wagner, either do not scale or rely on synchrony for the commitment phase and trust of $t/n$ parties. We formalize the problem of implementing such commitments with a probabilistic delay and without the aforementioned assumptions as Multi-Party Timed Commitments (MPTC) and present a solution -- the Time-Capsule protocol. Like previous approaches, Time Capsule forms a puzzle whose solution reveals the committed values. But unlike previous solutions, no party has an advantage in solving the puzzle, and individual commitments cannot be revealed before the entire set is committed. A particular application of MPTC realizes an advancement in the study of decentralized systems. The state of the art in decentralized systems is manifested in blockchain systems that utilize Proof of Work to achieve censorship resistance. However, they are still vulnerable to frontrunning, an issue that is plaguing operational systems. By adapting Time Capsule, we allow it to be used for Proof of Work, preventing frontrunning by system operators and tuning the puzzle difficulty using the blockchain mechanism.