Massachusetts Institute of Technology develops network of payment channels for Bitcoin

by Patrick Gon

Researchers at the Massachusetts Institute of Technology (MIT) developed Spider technology, a new second-layer solution that aims to help prevent congestion in payment networks with cryptocurrencies outside the chain.

According to its developers, which includes Vibhaalakshmi Sivaraman, a graduate student of the Laboratory of Computer Science and Artificial Intelligence (CSAIL), Spider’s scheme for cryptocurrency routing offers a type of payment channel network (PCN by its acronym in English), more efficient .

Used in second-layer scalability solutions, such as Bitcoin lightning network (LN), the MIT PCN would allow users to recharge accounts with a certain amount of a cryptocurrency. Payments are made through such a network of accounts and only the configuration or closing of the accounts is registered in the blockchain.

This can result in much faster and more scalable payments than those made directly in the blockchain, so Spider is proclaimed as a way to make cryptocurrency payments more feasible in physical stores. 

For example, bitcoin transactions currently take approximately 11 minutes to be confirmed on the network, although the average has sometimes peaked around 15 minutes. While making payments using CO takes between milliseconds and seconds.

According to the CSAIL report on Spider, these PCNs can be slowed down by inefficient routing schemes, and funds are often quickly depleted, which means that users are forced to reload frequently.

In that sense, the researchers point out that Spider is a more efficient way to route payments with cryptocurrencies, making it possible for participants to invest only a fraction of the funds in their accounts. It is also said that, compared to other PCNs, Spider is able to process about four times the amount of transactions before recording events on the blockchain.

Spider works by dividing transactions into small amounts or packages that propagate through different channels at varying rates, as described by CSAIL. By dividing the amounts into small packages, large payments can be routed through the accounts, which may have insufficient funds.

Unlike other payment systems, which would send the full payment and possibly be rejected due to the few funds (causing delays while the transaction is routed), Spider can produce payments that are less likely to block the network or fail, he says The team of developers. 

“Route the money so that the user funds in joint accounts are balanced allows us to reuse the same initial funds to support as many transactions as possible,” said Sivaraman.

The routing system was inspired by packet switching, a method for efficiently transmitting information throughout the web. Among other functions, this technology allows payments to be queued when there is congestion in the accounts, instead of rejecting them. The team adds that they also developed an algorithm that they say can help locate such congested accounts.

In tests where it was studied how Spider handles unidirectional payments in which an account runs out and needs to be recharged in the blockchain, the developer team said Spider can also perform better than other PCN systems. The lead author, Sivaraman, highlighted the following:

It is important to have a balanced and high capacity routing in PCNs to ensure that the money that users put in joint accounts is used efficiently, ”said Sivaraman. This should be an efficient and lucrative business. This means that you should route as many transactions as possible, with as few funds as possible, to give PCNs the best investment for their money.

The researchers hope to present Spider’s document later this month at the USENIX Symposium on Network Systems Design and Implementation. The group is also made up of other CSAIL members, such as Radhika Mittal of the University of Illinois at Urbana Champaign; and Kathleen Ruan and Giulia Fanti, from Carnegie Mellon University.

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