ShardTree: An Efficient Cross-Shard Protocol via Multi-party Virtual Payment Channel

Sharding is a key approach to improving blockchain scalability for parallel transaction processing. Among sharding strategies, state sharding splits the ledger across multiple shards, allowing each validator to process only a subset of transactions; however, maintaining consistency for cross-shard transactions remains challenging. Most existing sharding systems lack scalability due to reliance on Merkle proofs, centralized intermediaries, or redundant ledger storage. In this paper, we propose ShardTree, a cross-shard protocol that enables high throughput and low confirmation latency for sharded blockchains without these limitations. ShardTree leverages a multi-party virtual payment channel (MPC) to efficiently manage cross-shard transaction processing in batches. We first design an algorithm to select validators to form an MPC with the maximum capacity over a payment channel (PC) path. Based on this, ShardTree constructs an MPC over a PC tree. We also design a rollback scheme to ensure the atomicity of cross-shard transactions. We theoretically prove that ShardTree guarantees security in the presence of Byzantine adversaries. Finally, we implement ShardTree and assess its performance using real-world Ethereum transactions. Evaluation results demonstrate that ShardTree efficiently processes cross-shard transactions and outperforms state-of-the-art protocols in terms of transaction throughput and confirmation latency.