Strategic Analysis to defend against Griefing Attack in Lightning Network
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Payments routed in Lightning Network are susceptible to a griefing attack. In this attack, the channels get blocked, and the affected parties cannot process any payment request. Our work is the first to analyze griefing attacks in Hashed Timelock Contract or HTLC, from a game-theoretic point of view. Using the same model, we analyze another payment protocol Hashed Timelock Contract with Griefing-Penalty or HTLC-GP, which was proposed to counter griefing attacks. We find that HTLC-GP is weakly effective in disincentivizing the attacker. To further increase the cost of attack, we introduce the concept of guaranteed minimum compensation and integrate it into HTLC-GP. This modified payment protocol is termed HTLC-GP^ζ and unlike HTLC-GP, the protocol considers the participants to act rationally. By experimenting on several instances of Lightning Network, we show that the capacity locked drops to 40% in the case of HTLC-GP when the rate of griefing-penalty is set to 4.5× 10^-5, and 28% in the case of HTLC-GP^ζ when guaranteed minimum compensation is 2.5% of the transaction amount. These results justify our claim that HTLC-GP^ζ is better than HTLC-GP to counter griefing attacks.
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