Blockchain-Based, Privacy-Preserving, First Price Sealed Bid Auction (FPSBA) Verifiable by Participants
Ehsan Ghasaei, Amirali Baniasadi · 2023
The transparent, decentralized, and immutable properties of public blockchains make them appealing for applications that could benefit from these properties, including e-auctions. However, the usage of blockchains for such applications is hindered by concerns related to privacy and performance. We introduce a hybrid solution for e-auctions, leveraging the advantages of both centralized processing and the immutable registration offered by a public blockchain. In this approach, bids are processed by the auctioneer, while the masked bids are recorded on the blockchain. Consequently, the identity of the winner and their bid value is publicly accessible, while the remaining bid values remain confidential, known only to the bidder and the auctioneer and verifiable against the public results of the auction. These bids remain sealed unless the bidder chooses to disclose them during a dispute event. In this paper, we explain the proposed solution and present empirical analysis of its performance drawing on the outcomes of our preliminary experiments. We elaborate achieving promised privacy while showing 50% improvement over blockchain-based verifiable sealed-bid auction involving fewer than 15 bidders.