Decentralized Peer-to-Peer Auctions

This paper proposes a flexible architecture for the creation of Internet auctions. It allows the custom definition of the auction parameters, and provides a decentralized control of the auction process. Auction policies are defined as laws in the Law Governed Interaction (LGI) paradigm. Each of these laws specifies not only the auction algorithm itself (e.g. open-cry, dutch, etc.) but also how to handle the other parameters usually involved in the online auctions, such as certification, auditioning, and treatment of complaints. LGI is used to enforce the rules established in the auction policy within the agents involved in the process. After the agents find out about the actions, they interact in a peer-to-peer communication protocol, reducing the role of the centralized auction room to an advertising registry, and taking profit of the distributed nature of the Internet to conduct the auction. The paper presents an example of an auction law, illustrating the use of the proposed architecture.