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Cross-Chain Sealed-Bid Auctions Using Confidential Compute Blockchains

Jonas Gebele, Timm Mutzel, Burak Oez, Florian Matthes

TL;DR

This paper tackles the challenge of conducting sealed-bid auctions on public blockchains without sacrificing bid confidentiality or enforceability. It introduces a protocol that offloads sensitive bidding logic to a confidential compute blockchain powered by TEEs, while settlement and enforcement occur on a public chain, using per-bidder escrow addresses and enclave-signed settlement transactions. The authors implement a prototype on SUAVE with Ethereum settlement ( Sepolia ) and evaluate scalability and trust assumptions, including a proposer-based optimization to reduce off-chain queries. The approach offers strong confidentiality, verifiability, and scalability with minimal reliance on trusted intermediaries, signaling a practical path toward privacy-preserving, auditable DeFi auctions and similar asset-market applications.

Abstract

Sealed-bid auctions ensure fair competition and efficient allocation but are often deployed on centralized infrastructure, enabling opaque manipulation. Public blockchains eliminate central control, yet their inherent transparency conflicts with the confidentiality required for sealed bidding. Prior attempts struggle to reconcile privacy, verifiability, and scalability without relying on trusted intermediaries, multi-round protocols, or expensive cryptography. We present a sealed-bid auction protocol that executes sensitive bidding logic on a Trusted Execution Environment (TEE)-backed confidential compute blockchain while retaining settlement and enforcement on a public chain. Bidders commit funds to enclave-generated escrow addresses, ensuring confidentiality and binding commitments. After the deadline, any party can trigger resolution: the confidential blockchain determines the winner through verifiable off-chain computation and issues signed settlement transactions for execution on the public chain. Our design provides security, privacy, and scalability without trusted third parties or protocol modifications. We implement it on SUAVE with Ethereum settlement, evaluate its scalability and trust assumptions, and demonstrate deployment with minimal integration on existing infrastructure

Cross-Chain Sealed-Bid Auctions Using Confidential Compute Blockchains

TL;DR

This paper tackles the challenge of conducting sealed-bid auctions on public blockchains without sacrificing bid confidentiality or enforceability. It introduces a protocol that offloads sensitive bidding logic to a confidential compute blockchain powered by TEEs, while settlement and enforcement occur on a public chain, using per-bidder escrow addresses and enclave-signed settlement transactions. The authors implement a prototype on SUAVE with Ethereum settlement ( Sepolia ) and evaluate scalability and trust assumptions, including a proposer-based optimization to reduce off-chain queries. The approach offers strong confidentiality, verifiability, and scalability with minimal reliance on trusted intermediaries, signaling a practical path toward privacy-preserving, auditable DeFi auctions and similar asset-market applications.

Abstract

Sealed-bid auctions ensure fair competition and efficient allocation but are often deployed on centralized infrastructure, enabling opaque manipulation. Public blockchains eliminate central control, yet their inherent transparency conflicts with the confidentiality required for sealed bidding. Prior attempts struggle to reconcile privacy, verifiability, and scalability without relying on trusted intermediaries, multi-round protocols, or expensive cryptography. We present a sealed-bid auction protocol that executes sensitive bidding logic on a Trusted Execution Environment (TEE)-backed confidential compute blockchain while retaining settlement and enforcement on a public chain. Bidders commit funds to enclave-generated escrow addresses, ensuring confidentiality and binding commitments. After the deadline, any party can trigger resolution: the confidential blockchain determines the winner through verifiable off-chain computation and issues signed settlement transactions for execution on the public chain. Our design provides security, privacy, and scalability without trusted third parties or protocol modifications. We implement it on SUAVE with Ethereum settlement, evaluate its scalability and trust assumptions, and demonstrate deployment with minimal integration on existing infrastructure
Paper Structure (43 sections, 3 figures, 6 tables)

This paper contains 43 sections, 3 figures, 6 tables.

Table of Contents

  1. Introduction
  2. Background
  3. Blockchain & Smart Contracts
  4. Trusted Execution Environments
  5. TEE-based Confidential Compute Blockchains
  6. Problem Setting and Design Goals
  7. System Model
  8. Data Flow and Communication Model.
  9. Security Assumptions
  10. TEE
  11. Execution Layer.
  12. Settlement Layer.
  13. Auctioneer and Bidders.
  14. Settlement Layer Interfaces.
  15. Protocol Goals and Guarantees
  16. ...and 28 more sections

Figures (3)

  • Figure 1: Protocol flow of confidential sealed-bid auctions. (\ref{['fig:auction-setup']}) The auctioneer escrows the asset to a public blockchain address controlled by the confidential-compute blockchain; bidders receive encrypted, per-bidder funding addresses for private commitment. (\ref{['fig:winner-selection']}) After the bidding deadline, the confidential compute blockchain verifies escrow balances via off-chain queries, determines the highest valid bid, and emits signed settlement transactions for on-chain execution.
  • Figure 2: Lifecycle of a sealed-bid auction instance. Each state corresponds to a protocol phase; dotted paths indicate fallback or recovery transitions.
  • Figure 3: Gas consumption on the SUAVE blockchain as a function of the number of bidders in a sealed-bid auction.