Collaborative Research: CNS Core: Small: Cooperation and Competition in Payment Channel Networks: Routing, Pricing, and Network Formation

NSF 2007083 and 2008935, 2020/10/01-2024/09/30

Project description

The scalability of blockchain-based cryptocurrencies such as Bitcoin and Ethereum hinders their wide adoption. This is due to the massive resource consumption required by their underlying consensus mechanisms for guaranteeing the unique and synchronized global state. To address this scalability issue, Payment Channel Networks (PCNs) have been proposed to enable instant and inexpensive payments without requiring expensive and slow blockchain transactions. However, the concept of PCN is still at its infancy stage, and its fundamental understanding is still lacking. The goal of this project is to conduct a comprehensive study of PCNs from optimization, game theoretic, and economic perspectives, by providing an advanced suite of algorithms, theories, and mechanisms for routing, pricing, and network formation in PCNs. More specifically, this project will yield several advances: 1) Insightful understanding about PCNs; 2) Realistic models of PCNs considering both balance constraints and expiry constraints; 3) Advanced algorithms for routing a payment in PCNs subject to path-dependent constraints; 4) Rigorous analytical models of balance allocation when multiple payment paths compete for the available balance; 5) Scientific theories about the impact of the participants’ strategic behavior on the routing in PCNs and the formation of PCNs; 6) New economic approaches that provide guidelines on how to influence the participants in PCNs to make off-chain payments successful at the minimum cost.


Dr. Dejun Yang

Yuhui Zhang

Qiushi Wei

Alena Chang


  • Fence: Fee-based Online Balance-aware Routing in Payment Channel Networks
    X. Wang, R. Yu, D. Yang, G. Xue, H. Gu, Z. Li, and F. Zhou
    IEEE/ACM Transactions on Networking (TON), under minor revision.

  • BAR: A Balance-aware Routing Protocol in Payment Channel Networks
    Q. Wei, Y. Zhang, D. Yang, and G. Xue
    IEEE Transactions on Network Science and Engineering, under submission. 

  • Cumulonimbus: An Incentive Mechanism for Crypto Capital Commitment in Payment Channel Networks
    Y. Zhang, D. Yang, and G. Xue
    IEEE International Conference on Communications (ICC), 2022.
  • Why Riding the Lightning? Equilibrium Analysis for Payment Hub Pricing
    X. Wang, H. Gu, Z. Li, F. Zhou, R. Yu, and D. Yang
    IEEE International Conference on Communications (ICC), 2022.
  • RobustPay+: Robust Payment Routing with Approximation Guarantee in Blockchain-based Payment Channel Networks
    Yuhui Zhang and Dejun Yang
    IEEE/ACM Transactions on Networking (TON), vol. 29, no. 4, pp. 1676-1686, 2021.
  • Counter-Collusion Smart Contracts for Watchtowers in Payment Channel Networks
    Yuhui Zhang, Dejun Yang, Guoliang Xue, and Ruozhou Yu
    IEEE International Conference on Computer Communications (INFOCOM), 2021.


  • Yuhui Zhang (2021). Towards High-Throughput Cryptocurrency Transactions in Payment Channel Networks, Colorado School of Mines, Arthur Lakes Library.

invited talks

  • “Towards High-Throughput Cryptocurrency Transactions in Payment Channel Networks,” Missouri University of Science and Technology, February, 2022.
  • “Towards High-Throughput Cryptocurrency Transactions in Payment Channel Networks,” Montana State University, April, 2021.


Lightning Network (Crawled on 7/14/2020)