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  • Author or Editor: Péter Ligeti x
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Sealed bid auctions are a popular means of high-stakes bidding, as they eliminate the temporal element from the auction process, allowing participants to take less emotional, more thoughtful decisions. In this paper, we propose a digital communication protocol for conducting sealed bid auctions with high stakes, where the anonymity of bids as well as other aspects of fairness must be protected. The Dining Cryptographers’ Protocol (denoted by DC) was presented by David Chaum in 1988. The protocol allows the participants to broadcast a message anonymously. In a recent paper (Another Twist in the Dining Cryptographers’ Protocol, submitted to the Journal of Cryptology) the authors propose a variant of the original DC eliminating its main disadvantages. In this paper we present a cryptographic protocol realizing anonymous sealed bid auctions, such as first price or Vickrey auction, based on this variant. The proposed scheme allows to identify at least one dishonest participant violating the protocol without using of Trusted Third Parties. Additionally, we require that bids are binding. It is achieved by enabling all participants acting in concert (the so-called “angry mob”) to find out the identity of the winner, in case the winner fails to make the purchase.

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In this paper we propose a decentralized privacy-preserving system which is able to share sensible data in a way, that only predefined subsets of authorized entities can recover the data after getting an additional alarm message. The protocol uses two main communication channels: a P2P network where the encrypted information is stored, and a smaller private P2P network, which consists of the authorized parties called friend-to-friend network. We describe the communication protocol fulfilling the desired security requirements. The proposed protocol achieves unconditional security. The main cryptographic building blocks of the protocol are symmetric encryption schemes and secret sharing schemes.

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