Lock and Load: A Model for Free Blockchain Transactions through Token Locking

Bitcoin introduced the world to blockchain-based cryptocurrencies, and Ethereum highlighted their value in building distributed applications (dApps). However, the development of blockchain-based applications has been held back by high transaction fees. In this paper, we introduce a model for free transactions on the blockchain. Rather than spending tokens for transaction fees, a token owner (known as a client) locks tokens to generate new tokens as a reward for the miner who includes the transaction in a block. This token-locking reward model eases congestion on the blockchain in the same manner as fees do in protocols like Bitcoin, but without forcing clients to sacrifice their tokens. This same design can be used to incentivize service providers. We show how a client can lock their tokens to generate new tokens for storage providers, and how this reward mechanism can help to facilitate an audit of the storage provider.