In this paper we propose a blockchain-based automatic indemnification mechanism. Clients and service providers (SPs) exchange signed messages according to a predefined protocol that enables clients to utilize service-provider services with simultaneous cryptographic proof of service. When a client has discovered an SP to have violated a service level agreement based on cryptographic proof, then they can obtain cryptocurrency as a compensation by raising objections to a smart contract on a public blockchain. When an objection has been judged successful by programs located in the smart contract, a portion of the deposit (cryptocurrency in the smart contract) will be transferred to the account of the objection-raiser. In this way, the need to establish and run a customer service center with employees for processing such claims and refunds is obviated. Moreover, the traditional third-party trust is no longer needed. Focusing on services for cloud-storage service, we propose protocols and implementation of an indemnification system in the Ethereum. The feasibility of the proposed application has been demonstrated through pilot implementation and testing.
Hwang, G. H., Tien, P. C., & Tang, Y. H. (2020). Blockchain-based Automatic Indemnification Mechanism Based on Proof of Violation for Cloud Storage Services. In ACM International Conference Proceeding Series (pp. 90–94). Association for Computing Machinery. https://doi.org/10.1145/3390566.3391661