TULIP: A Fully Incentive Compatible Blockchain Framework Amortizing Redundant Communication

Blockchain technology allows running ordered transactions within an immutable public ledger in a decentralized manner. It consists of two processes: advertisement where the participants become aware of the new transactions and chain extension where the validated transactions are added into a block by extending the chain. Existing blockchain protocols have mainly focused on the chain extension, though the advertisement process has not been dealt with in depth. More specifically, transaction advertisement is fulfilled in an altruistic manner and the same gossip-like propagation mechanism is used for both transactions and blocks. Consequently, the existing protocols are not only incompatible within a rational setting where participants try to maximize their benefit but also suffering from inefficient bandwidth usage. In this work, we propose Tulip, a two-layered blockchain framework, which enriches any blockchain protocol with respect to the aforementioned advertisement issues. Tulip treats the advertisement and chain extension processes separately. Transactions are collected and verified by a transaction collector, whereas extending the chain with a new block is done by a round leader. In order to achieve a generic framework, we model the basic functionalities of a ledger. These functionalities are realized by any existing blockchain protocol and responsible for the chain extension process. Thanks to the modular structure of Tulip, the chain extension process can be combined with an incentive compatible and bandwidth-efficient advertisement process. Tulip can be built upon any blockchain protocol while preserving the ledger properties persistence and liveness. Moreover, it enhances the liveness into strong liveness property which requires only one honest participant, rather than all, to advertise a transaction. In this manner, to the best of our knowledge, Tulip forms the first blockchain protocol having incentive compatible chain extension and transaction advertisement processes. Finally, we show that Tulip can be used to reduce redundant bandwidth usage by up to 99%.