IAP: Instant Auditing Protocol for Anonymous Payments

Blockchain(e.g., Bitcoin) has widespread use in digital currency, which is entirely public to all participants, revealing users' privacy and transaction details. Anonymous blockchains without auditing capability can offer strong privacy guarantees, they could be used by illegal activities. However, anonymous blockchains with auditing capability suffer from two limitations: (i) inefficient auditing capability; (ii) lower degree of decentralization. To address these problems, this paper presents IAP, an instant auditing protocol based on anonymous blockchain with strong anonymity guarantees, which uses audit node cluster to implement decentralized instant auditing. The experimental results show that IAP only needs 60 milliseconds to complete an audit on average with 16 audit nodes, which accounts for one thousand of a complete transaction time. IAP can still complete efficient auditing when there are more than half of the nodes are honest in the audit node cluster. Moreover, its performance is virtually unaffected by increased number of transactions.