CReam: A Smart Contract Enabled Collusion-Resistant e-Auction

Auction is an effective way to allocate goods or services to bidders who value them the most. The rapid growth of e-auctions facilitates online transactions but poses new and distinctive challenges. It is difficult to establish trusts among sellers, buyers and auctioneers without the centralized auction websites or platforms (the auctioneer) that collect bids and derive the auction results. However, these third parties may be untrustworthy, and malicious sellers or buyers may refuse to deliver the goods or payment according to the protocol. Moreover, the open and anonymous online environment may stimulate auction participants to form collusion coalitions to rig the auction and reap unfair profit. Many auction designs have been proposed to address these concerns, but they fall short of simultaneously achieving decentralization (i.e., held without a trusted third utility), strong consensus (i.e., the establishment of trust), collusion-resistance and practical implementation. We present CReam, the first decentralized collusion-resistant e-auction system that is implemented with smart contract on the blockchain. With the carefully-designed smart auction contract, mutually distrustful and rational sellers and buyers are stimulated to operate properly hence transact safely without trusted third parties. The auction mechanism in the smart contract can effectively prevent bidder collusion and realize economic robustness, i.e., truthfulness. We implement a fully functional CReam on the Ethereum network. Extensive experimental results confirm that CReam can greatly reduce the probability of collusion and achieve an approximate optimal revenue at a low cost of contract execution.