Using Payments to Promote Cooperation in Anonymity Protocols

Like many peer-to-peer applications, anonymous communication systems are vulnerable to freeriders, peers that use the system while providing little or no service to others. To complicate matters, the identity of the free-rider is obscured by the very anonymity such systems are designed to provide, imposing challenging design constraints for incentive mechanisms to discourage free-riding. We argue that these constraints are well addressed by requiring currency to be exchanged in return for service. Based on this idea, we propose a novel technique to allow anonymous digital cash payments to be made to those who provide service. We incorporate this technique into a class of peer-peer anonymous protocols that are based on Chaumian mixes while introducing modest message delay overheads and preserving their architectural simplicity. Finally, we formulate an abstract model of self-interested users in such a system and show that a payment based incentive mechanism can significantly improve the degree of anonymity by fostering greater cooperation among peers.