Blockchain micropayments in decentralised platforms

Jaro Šatkevič, jaro@mysterium.network

Blockchain payments

Slow

Expensive

Secure

Censorship resistant

Open and permissionless API

All transaction history have to be stored and synced among all network's full nodes

Micropayment channels

3

7

5

5

2

8

4

6

2

8

Each party have open channel to any other party

Payment promises

digital cheques

11

15

9

Alice can over promise   =   double spending problem

settle

Payment via intermediaries

Alice -> Bob -> Carol -> Dave

How to ensure that Bob and Carol will resend payment?

Dave requests payments

(issues invoice by sending hashlock to Alice)

Alice sends locked tx to bob via opened channel

Bob resends locked tx to Carol and Carol to Dave

Dave reveals secret to Carol to unlock transaction

Carol reveals secret all way back to Alice

(final step of micropayment)

Lightning Network

Complicated routing

(all parties have to be on-line and have enough funds)

Problems of Lightning Network

  • Channels cannot be created on-the-fly.
  • Routing paths are much harder to find when values are considered.
  • Users have to be online and use hot wallets.
  • Hubs have to lock a lot of funds.
  • Expensive to increase channel.
  • Requires specialised software.

Hermes protocol

Lightweight solution for high throughput micropayments

Consumer to Provider

payment promises

  1. Providers can aggregate promises
  2. Consumers can top-up via any wallet
  3. Settlement can be done at any moment
  4. Hermes is non-custodial party

settle multiple promises from many consumers via single on-chain tx

even from exchanges

can be each hour or once in a month

he can't stop a transaction or take users money

Request based communication with Hermes

Problems of payment channels

"Rich" hub problem

Accountant have to lock 40 own tokens

10 000 providers

=

200 000 locked tokens*

*1 token = 1 USD

Staking as way to insure incoming channel balance

Deposits 10 tokens stake

Consumer send promise

Accountant resend promise

Provider gets stake back

Etherless transactions

Ethereum will require ETH to pay for tx fees

Actual technical implementation

Smart contracts

Payments go package

Transactor

Hermes

Questions?

Hermes protocol - Lightweight solution for high throughput micropayments

By Jaro

Hermes protocol - Lightweight solution for high throughput micropayments

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