Efficient Verifiable Encryption (and Fair Exchange) of Digital Signatures

A fair exchange protocol allows two users to exchange items so that either each user gets the other's item or neither user does. In [2], the verifiable encryption is introduced as a primitive that can be used to build extremely efficient fair exchange protocols where the items exchanged represent digital signatures. Such protocols may be used to digitally sign contracts.
This paper presents new schemes for verifiable encryption of digital signatures. We make use of a trusted third party (TTP) but in an optimistic sense, i.e. the TTP takes part in the protocol only if one user cheats or simply crashes. The performance of our schemes significantly surpass that of prior art.

Keywords: Fair Exchange, Verifiable Encryption, Contract Signing Problem, Public-key Cryptography, Digital Signatures, Proof of Knowledge.