Design of Trusted Market Platforms using Permissioned Blockchains and Game Theory (2001.05655v1)

Abstract: The blockchain concept forms the backbone of a new wave technology that promises to be deployed extensively in a wide variety of industrial and societal applications. Governments, financial institutions, banks, industrial supply chains, service companies, and even educational institutions and hospitals are investing in a substantial manner in the hope of improving business efficiency and operational robustness through deployment of blockchain technology. This thesis work is concerned with designing trustworthy business-to-business (B2B) market platforms drawing upon blockchain technology and game theory. The proposed platform is built upon three key ideas. First, we use permissioned blockchains with smart contracts as a technically sound approach for building the B2B platform. The blockchain deploys smart contracts that govern the interactions of enterprise buyers and sellers. Second, the smart contracts are designed using a rigorous analysis of a repeated game model of the strategic interactions between buyers and sellers. We show that such smart contracts induce honest behavior from buyers and sellers. Third, we embed cryptographic regulation protocols into the permissioned blockchain to ensure that business sensitive information is not revealed to the competitors. We believe our work is an important step in the direction of building a powerful B2B platform that maximizes social welfare and enables trusted collaboration between strategic enterprise agents.