Two-Party State Channels with Assertions

Abstract

An empirical case study to evaluate state channels as a scaling solution for cryptocurrencies demonstrated that providing an application’s full state during the dispute process for a state channel is financially costly (i.e. $0.24 to $8.83 for a battleship game) which can hamper their real-world use. To overcome this issue, we present State Assertion Channels, the first state channel to guarantee an honest party is always refunded the cost if it becomes necessary to send an application’s full state during the dispute process. Furthermore it ensures an honest party will pay an approximate fixed cost to continue an application’s execution via the dispute process. We provide a proof of concept implementation in Ethereum which demonstrates it costs approximately $0.02 to submit evidence regardless of the smart contract’s application.