An Auction-Based Incentive Mechanism with Blockchain for IoT Collaboration

Abstract

The prosperous development of IoT has created tremendous opportunities to improve people's lives. Essentially, the core property of the IoT applications is the ability to perform collaborative tasks with data supplied by separate IoT managers. However, the fulfillment of collaborative tasks is driven by the participations of the IoT managers. Generally, the willingness can be activated with appropriate profit (or incentive cost). Thus, an efficient incentive mechanism is needed to motivate the IoT managers to participate in the collaboration. In this paper, we present a reverse auction-based incentive mechanism with the goal of minimizing and stabilizing incentive costs while maintaining adequate participants. To prevent the incentive cost explosion, a droppers recruiting scheme is leveraged to attract the inactive participants. A price verification strategy is designed to avoid bid cheating. Furthermore, we introduce blockchain to orchestrate the interactions between collaborative parties, so as to protect their privacy. Finally, we show the feasibility and efficiency of our proposed framework with simulation experiments and theoretical analysis.