The Advances in Financial Technologies 2024 (AFT 2024) conference, held in September 2024 in Vienna, Austria, focuses on the latest advances in financial technology, including decentralized finance (DeFi), cryptocurrencies, security, and anonymity. Special attention is paid to data protection and privacy, securing decentralized systems, and improving cryptocurrency and financial protocols. Let’s look at some of the most interesting innovations and research discussed at the AFT’24 conference.

Cryptocurrencies and security: innovations in election processes and consensus

One of the conference’s key themes was research aimed at improving the security of cryptocurrencies and election processes in Proof-of-Stake (PoS) blockchains. The problem of deterring attacks on leader elections is discussed in the paper “Accountable Secret Leader Election” (Miranda Crist et al.), where mechanisms are proposed to ensure the privacy and simultaneous accountability of elected leaders. In such systems, leader secrecy protects against adaptive attacks where attackers may attempt to prevent elected participants from fulfilling their responsibilities. However, research has shown that existing election mechanisms fail to identify those leaders who intentionally fail to fulfill their responsibilities, opening the door to manipulation of future elections.

The study proposes several approaches to address the problem of refusal to participate and bad faith behavior in leader elections. The solutions include the use of time-delay functions (VDFs), key revelation, and threshold cryptography, which can identify rogue leaders while maintaining a high level of secrecy. This improves PoS protocols and helps prevent attacks on decentralized governance systems by offering a fairer and more secure election mechanism for blockchain systems.

Another key topic was the problem of attacks on decentralized autonomous organizations (DAOs). The study “SoK: Attacks on DAOs” analyzes various methods of attacking DAO management systems in detail, including vote and consensus manipulation. DAOs have become an important element of the blockchain ecosystem, and the work provides a new perspective on the typology of attacks and how to defend such systems. This research is important to further develop sustainable and secure governance models for decentralized organizations, preventing their destruction through manipulation and unscrupulous actions of participants.

Anonymity and privacy: new horizons for cryptocurrency solutions

Privacy and anonymity in cryptosystems remain key challenges for developers and researchers. One of the most significant topics in this area is protecting the privacy of cryptocurrency users. In “Privacy Comparison for Bitcoin Light Client Implementations” (Arad Kotser and Ori Rottenstreich), the authors analyze different solutions for improving the privacy of Bitcoin Light clients. Light clients are simplified versions of wallets that use less data to verify transactions, making them mobile-friendly but less secure in terms of privacy.

The research looks at how the privacy of light client users can be improved through various cryptographic methods and techniques aimed at hiding transaction data. These solutions become an important step towards improving user privacy, especially in light of the increasing use of Bitcoin and other cryptocurrencies globally.

Another significant security research is the paper “CrudiTEE: A Stick-And-Carrot Approach to Building Trustworthy Cryptocurrency Wallets with TEEs”. This paper proposes a new architecture for cryptocurrency wallets that utilizes Trusted Execution Environments (TEEs) to ensure transaction reliability and security. The study emphasizes the importance of using such environments to prevent cyberattacks and protect the privacy of cryptocurrency users. The use of TEE in cryptocurrency wallets can protect key user information from leaks and unauthorized access, making such wallets safer and more secure.

Decentralized Finance (DeFi) and Audit

DeFi development continues to be a hot topic – the AFT 2024 conference presents several key studies in this area. One of the most interesting is the study “DeFiAligner: Leveraging Symbolic Analysis and Large Language Models for Inconsistency Detection in Decentralized Finance” (Rundong Gan et al.), which focuses on detecting inconsistencies in the smart contracts used in DeFi. The researchers apply symbolic analysis and large language models (LLMs) to automatically check the code of smart contracts for vulnerabilities and bugs that can lead to serious financial losses. This is important given the growing use of decentralized finance and the need to prevent cyberattacks and fraud on such platforms.

Cross Ledger Transaction Consistency for Financial Auditing” (Vlasis Koutsos et al.) is devoted to the topic of creating mechanisms to harmonize transactions between different blockchains. One of the challenges of modern financial technology is the need for transparent transaction auditing, especially when transactions are conducted between different blockchains. This research proposes new methods that help to ensure the reliability and accuracy of financial transactions, which significantly improves transparency and trust in decentralized financial systems.

Analysis of the mechanisms of decentralized systems is also an important area of interest. The study “Credible, Optimal Auctions via Public Broadcast” (Tarun Chitra et al.) focuses on the optimization of auction mechanisms in blockchain systems. The authors propose a novel approach to organizing auctions based on public broadcasts, which improves the transparency and trustworthiness of the auction process. This research is important for decentralized finance and trading platforms, where auction mechanisms play a key role in allocating resources and maintaining system stability.

Blockchain and its scalability: new approaches

The scalability of blockchain technology is one of the most discussed challenges in the field, and the AFT 2024 conference offers several innovative solutions. The paper “A Circuit Approach to Constructing Blockchains on Blockchains” (Ertem Tas et al.) proposes a new way of constructing blockchains that can significantly improve their performance and efficiency. The concept of “blockchain on blockchain” involves the use of schemes and algorithms that enable the construction of blockchain systems that interact with each other, which can be an important step towards a more efficient and scalable infrastructure for decentralized finance.

In addition, the study “Optimal RANDAO Manipulation in Ethereum” (Kaya Alpturr and Matthew Weinberg) focuses on vulnerabilities in the random leader selection mechanism in Ethereum. The paper analyzes methods of manipulating the RANDAO system and proposes improvements to reduce the likelihood of attacks on this mechanism. RANDAO is used to randomly select leaders, which plays a key role in the security and efficiency of consensus mechanisms in blockchains. Researchers propose new methods to protect and improve the transparency of this process, which is especially important for the future of Ethereum and other PoS systems.

Data protection and new cryptographic methods

One of the central themes of the conference was improving cryptographic methods to protect data in decentralized systems. The study “SoK: Zero-Knowledge Range Proofs” (Miranda Crist et al.) analyzes the use of Zero-Knowledge Range Proofs in various cryptographic systems. Zero-Knowledge Range Proofs is a method for proving the truth of assertions without revealing any additional data, making it particularly useful for privacy in blockchain systems and financial protocols. This approach finds application in decentralized financial platforms where protecting the privacy of users and their transactions is important.

Conference Outcomes

The AFT 2024 conference presented important research on developments in financial technology and cryptography, focusing on decentralized finance, security, and privacy in blockchain systems.

The topics listed above closely overlap with the work of diva.exchange. The research vector of the DIVA project is aimed at solving privacy and security issues in the exchange of various kinds of crypto-assets.

The joint efforts of the crypto community and enthusiastic researchers create a solid base of trust, stability, and sustainable development of new financial technologies.

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The non-profit association diva.exchange, Switzerland, uses a barrier-free and collaborative approach to create free banking technology for everyone. Open-source technology ensures the privacy of all participants in the financial system of the future. The blockchain-based system is fully distributed. Everyone can participate in diva.exchange.

Diva.exchange is committed to the belief that only commercially free technology can reliably protect user privacy.

Collaboration with the scientific community plays an important role in the development of diva.exchange. The results of diva.exchange research are constantly being validated by academic institutions and publicly presented at specialized conferences.

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