Evaluating transaction trust and risk levels in peer-to-peer e-commerce environments

As it lacks central management in Peer-to-Peer (P2P) e-commerce environments, prior to new transactions with an unknown peer, the trust evaluation is critical, which relies on the transaction history data. Traditionally the evaluation process is based on other peers’ recommendations neglecting transaction amounts. This may lead to the bias in the transaction trust evaluation and risk the new transaction, which may occur between unknown peers. The weakness may be utilized by malicious sellers to obtain good transaction reputation by selling cheap goods and then cheat buyers by selling expensive goods. In this paper we present a novel model for transaction trust evaluation, which differentiates transaction amounts and thus computes different impact factors when analyzing old transactions 2 Y. Wang, D. S. Wong, K.-J. Lin and V. Varadharajan and computing trust values. As a result, the trust evaluation becomes more accurate, which is dependant on transaction history, the amounts of old transactions, and the amount of the new transaction. Some extensions are also proposed to take the temporal dimension, transaction count and the credibility of responding peers into consideration. Therefore the obtained trust value can reflect the nature of transactions, and the difference of the new transaction and old transactions. Furthermore, the trust value can be taken as the risk indication of the forthcoming transaction and is valuable for the decision-making of the buyers.