Optimistic Fair-Exchange with Anonymity for Bitcoin Users

Fair-exchange and anonymity are two important attributes in e-commerce. It is much more difficult to expect fairness in e-commerce transactions using Bit coin due to anonymity and transaction irreversibility. Genuine consumers and merchants who would like to make and receive payments using Bit coin may be reluctant to do so due to this uncertainty. The proposed protocol guarantees strong-fairness while preserving anonymity of the consumer and the merchant, using Bit coin as a payment method which addresses the aforementioned concern. The involvement of the trusted third party (TTP) is kept to a minimum, which makes the protocol optimistic and the exchanged product is not revealed to TTP. It achieves dispute resolution within the protocol run without any intervention of an external judge. Finally we show how the protocol can be easily adapted to use other digital cash systems designed using public ledgers such as Zerocoin/Zerocash.