December 05, 2019
Abstract. A value transfer protocol would allow nodes in a distributed system to be compensated by customers for the service they provide. A payment mechanism provides part of the solution, but the main benefits are lost if the customer is required to pay each node separately and directly, and if the payment is valid without the node actually providing service.
We propose a solution to payments and compensation validity by employing an out-of-band payment intermediary between customers and service providers, defining the service parameters, and facilitating in disbursing funds provided by a customer to service providers proportionally for service provided, based on proof of service. Proof of service, defined in part by share tokens, are cryptographically and independently generated by a customer and included within traffic sent through service providers, serving a dual-role of allowing a way for service providers to authorize service, as well as a representation of value if proven valid for service provided. Service providers accumulate these share tokens to later submit for validation and compensation. By employing a proportional share-based model, compensation is split between service providers according to the number of valid share tokens they accumulate in proportion to the total number of valid shares tokens submitted by all service providers for a specific service plan.