Page 65 - ITU Journal Future and evolving technologies Volume 2 (2021), Issue 5 – Internet of Everything

ITU Journal on Future and Evolving Technologies, Volume 2 (2021), Issue 5

3‑OF‑3 MULTISIGNATURE APPROACH FOR ENABLING LIGHTNING NETWORK
MICRO‑PAYMENTS ON IOT DEVICES*

2
1
1
Ahmet Kurt , Suat Mercan , Enes Erdin , Kemal Akkaya 1
1 Department of Electrical and Computer Engineering, Florida International University, Miami, FL 33174, United States,
2 Department of Computer Science, University of Central Arkansas, Conway, AR 72035, United States
NOTE: Corresponding author: Ahmet Kurt, akurt005@ iu.edu
*A preliminary version of this paper was accepted as a poster paper to 2021 IEEE International Conference on Blockchain and
Cryptocurrency (IEEE ICBC 2021).

Abstract – Bitcoin’s success as a cryptocurrency enabled it to penetrate into many daily life transactions. Its problems
regarding the transaction fees and long validation times are addressed through an innovative concept called the Lightning
Network (LN) which works on top of Bitcoin by leveraging off‑chain transactions. This made Bitcoin an attractive micro‑
payment solution that can also be used within certain IoT applications (e.g., toll payments) since it eliminates the need for
traditional centralized payment systems. Nevertheless, it is not possible to run LN and Bitcoin on resource‑constrained IoT
devices due to their storage, memory, and processing requirements. Therefore, in this paper, we propose an ef icient and
secure protocol that enables an IoT device to use LN’s functions through a gateway LN node even if it is not trusted. The
idea is to involve the IoT device only in signing operations, which is possible by replacing LN’s original 2‑of‑2 multisignature
channels with 3‑of‑3 multisignature channels. Once the gateway is delegated to open a channel for the IoT device in a secure
manner, our protocol enforces the gateway to request the IoT device’s cryptographic signature for all further operations on
the channel such as sending payments or closing the channel. LN’s Bitcoin transactions are revised to incorporate the
3-of‑3 multisignature channels. In addition, we propose other changes to protect the IoT device’s funds from getting
stolen in possible revoked state broadcast attempts. We evaluated the proposed protocol using a Raspberry Pi
considering a toll payment scenario. Our results show that timely payments can be sent and the computational and
communication delays associated with the protocol are negligible.

Keywords – Bitcoin, Internet of Things, lightning network, multisignature, payment channel networks

1. INTRODUCTION However, despite their popularity, mainstream cryp‑
tocurrencies such as Bitcoin and Ethereum suffer from
The Internet of Things (IoT) has been adopted in various scalability issues in terms of transaction con irmation
domains at a great pace in the last decade as it brings nu‑ times and throughput [7]. This increases the transac‑
merous opportunities and convenience [1]. In such appli‑ tion fee and makes their adoption infeasible for micro‑
cations, typically resource‑constrained IoT devices sup‑ payments. The Payment Channel Network (PCN) idea has
ply data from their sensors to remote servers through a emerged as a second layer solution to address this prob‑
wireless connection. With their increased capabilities, lem by utilizing off‑chain transactions [8]. For instance,
we have been witnessing applications where an IoT de‑ Lightning Network (LN) [9] is the PCN solution designed
vice may need to do inancial transactions. For instance, for Bitcoin which exceeded 20,000 nodes in three years.
IoT devices may be used in commercial applications such While LN is a successful solution, the current LN pro‑
as toll systems, where an on‑board unit acting as an IoT tocol cannot be run on most IoT devices because of the
device on a vehicle may need to do automatic payments as computation, communication, and storage requirements
the vehicle passes through a toll gate [2]. Similarly, [10]. As well known, IoT devices are mostly resource‑
there are other cases such as automated vehicle charging, constrained and most of them are not capable of running
parking payment, sensor data selling, etc. where micro‑ the LN protocol where a full Bitcoin node (e.g., as of to‑
payments need to be made [3, 4]. day 349 GB of storage area is required) has to be run‑
In these applications, the common feature is device‑to‑ ning alongside an LN node. Additionally, a robust Inter‑
device (D2D) communication which may not involve any net connection and relatively high computation power are
human intervention. Therefore, transactions should be required to receive and verify new blocks for the Bitcoin
automated. While these automated payments may be node. Even if we can empower some IoT devices with
linked to credit card accounts of device owners, this is not the needed resources, these IoT devices still need to be
only inconvenient but also requires the involvement of always online to receive synchronization messages from
third parties that will bring additional management over‑ both Bitcoin and LN, which is not realistic for IoT either.
head. In this context, cryptocurrencies have great poten-
a
successful merge of IoT and cryptocurrency technologies
such as Bitcoin [5] and Ethereum [6] looks promising.

© International Telecommunication Union, 2021 53