Secure cross-chain decentralized exchange

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Tucci_Lorenzo_2025.pdf (329.12 KB)

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Sähkötekniikan korkeakoulu | Bachelor's thesis
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Date

2025-09-05

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Major/Subject

Digital Systems and Design

Mcode

ELEC3056

Degree programme

Aalto Bachelor's Programme in Science and Technology

Language

en

Pages

33

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Abstract

From the earliest markets to today’s globally interconnected economies, exchanging money has been a defining feature of civilization. While historically centralized institutions have been in charge of securing and finalizing transactions, the advent of Bitcoin has marked the birth of decentralized finance. In this new paradigm, trust is no longer placed in a specific government, institution or corporation, but instead on mathematical proofs, protocol design and cryptographic assumptions. In an ever increasingly multipolar world - where financial censorship and transaction surveillance are becoming common coercion tools - the appeal of uncensorable money continues to grow. While a variety of decentralized financial systems exist, their interoperability remains a critical challenge. In this thesis, we study existing solutions and propose new methods for cross-system assets exchange. We first examine how to realize secure peer-to-peer (P2P) asset exchange protocols between two users. Such a task can be accomplished by a class of blockchain protocols known as atomic swaps, and we highlight the limitations of solutions that either require the underlying blockchain to support scripting or rely on a computionally intensive cryptographic primitive known as timelock puzzles. In order to improve on the current state of the art, we identify and propose a natural and minimal blockchain functionality called commit transactions, which we show to be sufficient to realize generic atomic swaps protocols. We next investigate how multiple users can establish a decentralized exchange service. Building on top of the traditional liquidity pool setting, we describe a system that extends to a cross-chain environment. We provide a costruction that, under an assumed setup mechanism, realizes an universal exchange protocol. Finally, we explore how such solutions can be realized in the most challenging setting of private and anonymous systems. Specifically, we focus into achieving compability with the most commonly traded private cryptocurrency, Monero. We propose a modifications to adapt Monero’s transaction scheme, ring confidential transactions (RingCT), to the newly proposed atomic swap protocol.

Description

Supervisor

Lai, Russel W. F.

Thesis advisor

Lai, Russel W. F.

Keywords

blockchain, atomic swaps, threshold signatures, decentralized exchange, cross-chain, RingCT

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https://urn.fi/URN:NBN:fi:aalto-202511048628

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[kand] Sähkötekniikan korkeakoulu / ELEC