Notes on Offchain Protocols

Blockchain based systems, in particular cryptocurrencies, face a serious limitation: scalability. This holds especially in terms of number of transactions per second. There are still technical challenges that do not allow these systems to substantially increase the number of processed transactions. Several alternatives are currently being pursued by both the research and practitioner communities. One venue for exploration is on protocols that do not constantly add transactions on the blockchain and therefore do not consume the blockchain’s resources. This is done using off-chain transactions, via payment channels. This work revisits and relates the several existing off-chain channels, payment and state, payment networks and their respective network management algorithms. The main goal of this survey is to provide a comprehensive list of the state-of-art protocols available in the literature, outlining their respective approaches, advantages and disadvantages.