Distributed Double Auction Mechanisms for Large-Scale Device-to-Device Resource Trading

While some mobile users in wireless networks may experience temporal scarcity of wireless network resources such as data plan, computation capacity and energy storage, some others may leave them underutilized. If the appropriate market existed, users connected locally with D2D links could exchange such resources with low communication cost and realize significant efficiency gains by reducing waste and achieving resource pooling. This paper proposes such a D2D trading market that scales for large numbers of users. Contrary to traditional resource allocation solutions that are mostly centralized, our double auction mechanism exploits local D2D connectivity and uses distributed computation to achieve near-optimal allocative efficiency. The final prices for each matched pair of buyer and seller are adjusted in a way to induce incentive compatibility and depend on their own declarations in terms of quantity and valuation. We prove that the overall mechanism has significant social welfare gains compared to other widely-used distributed pricing mechanisms. It is also individually rational, ex-ante budget balanced using a subscription fee, and robust to perturbations of the model parameters. To render the system fully manipulation-proof, we further propose a distributed auditing scheme that prevents users from altering the decentralized computation to increase their profits. Finally, we model the repeated execution of the mechanism and determine the best trading frequency by taking into account the arrivals and departures of new participants.