Livshits, Benjamin
Auto.gov: Learning-based On-chain Governance for Decentralized Finance (DeFi)
Xu, Jiahua, Perez, Daniel, Feng, Yebo, Livshits, Benjamin
In recent years, decentralized finance (DeFi) has experienced remarkable growth, with various protocols such as lending protocols and automated market makers (AMMs) emerging. Traditionally, these protocols employ off-chain governance, where token holders vote to modify parameters. However, manual parameter adjustment, often conducted by the protocol's core team, is vulnerable to collusion, compromising the integrity and security of the system. Furthermore, purely deterministic, algorithm-based approaches may expose the protocol to novel exploits and attacks. In this paper, we present "Auto.gov", a learning-based on-chain governance framework for DeFi that enhances security and reduces susceptibility to attacks. Our model leverages a deep Q- network (DQN) reinforcement learning approach to propose semi-automated, intuitive governance proposals with quantitative justifications. This methodology enables the system to efficiently adapt to and mitigate the negative impact of malicious behaviors, such as price oracle attacks, more effectively than benchmark models. Our evaluation demonstrates that Auto.gov offers a more reactive, objective, efficient, and resilient solution compared to existing manual processes, thereby significantly bolstering the security and, ultimately, enhancing the profitability of DeFi protocols.
The Anatomy of a Cryptocurrency Pump-and-Dump Scheme
Xu, Jiahua, Livshits, Benjamin
While pump-and-dump schemes have attracted the attention of cryptocurrency observers and regulators alike, this paper represents the first detailed empirical query of pump-and-dump activities in cryptocurrency markets. We present a case study of a recent pump-and-dump event, investigate 412 pump-and-dump activities organized in Telegram channels from June 17, 2018 to February 26, 2019, and discover patterns in crypto-markets associated with pump-and-dump schemes. We then build a model that predicts the pump likelihood of all coins listed in a crypto-exchange prior to a pump. The model exhibits high precision as well as robustness, and can be used to create a simple, yet very effective trading strategy, which we empirically demonstrate can generate a return as high as 60% on small retail investments within a span of two and half months. The study provides a proof of concept for strategic crypto-trading and sheds light on the application of machine learning for crime detection.
Percival: Making In-Browser Perceptual Ad Blocking Practical With Deep Learning
Din, Zain ul Abi, Tigas, Panagiotis, King, Samuel T., Livshits, Benjamin
Online advertising has been a long-standing concern for user privacy and overall web experience. Several techniques have been proposed to block ads, mostly based on filter-lists and manually-written rules. While a typical ad blocker relies on manually-curated block lists, these inevitably get out-of-date, thus compromising the ultimate utility of this ad blocking approach. In this paper we present Percival, a browser-embedded, lightweight, deep learning-powered ad blocker. Percival embeds itself within the browser's image rendering pipeline, which makes it possible to intercept every image obtained during page execution and to perform blocking based on applying machine learning for image classification to flag potential ads. Our implementation inside both Chromium and Brave browsers shows only a minor rendering performance overhead of 4.55%, demonstrating the feasibility of deploying traditionally heavy models (i.e. deep neural networks) inside the critical path of the rendering engine of a browser. We show that our image-based ad blocker can replicate EasyList rules with an accuracy of 96.76%. To show the versatility of the Percival's approach we present case studies that demonstrate that Percival 1) does surprisingly well on ads in languages other than English; 2) Percival also performs well on blocking first-party Facebook ads, which have presented issues for other ad blockers. Percival proves that image-based perceptual ad blocking is an attractive complement to today's dominant approach of block lists