SmartCast: An incentive compatible consensus protocol using smart contracts

Abstract

Motivated by the desire for high-throughput public databases (i.e., “blockchains”), we design incentive compatible protocols that run “off-chain”, but rely on an existing cryptocurrency to implement a reward and/or punishment mechanism. Our protocols are incentive compatible in the sense that behaving honestly is a weak Nash equilibrium, even in spite of potentially malicious behavior from a small fraction of the participants (i.e., the BAR model from Clement et al. [7]). To show the feasibility of our approach, we build a prototype implementation, called SmartCast, comprising an Ethereum smart contract, and an off-chain consensus protocol based on Dolev-Strong [10]. SmartCast also includes a “marketplace” smart contract that randomly assigns workers to protocol instances. We evaluate the communication costs of our system, as well as the “gas” transaction costs that are involved in running the Ethereum smart contract.