A sybil-proof referral system based on multiplicative reputation chains

Transactions between peers in social networks generate direct reputation (social capital) information. This can be augmented with indirect referrals, on demand or continually, thus giving peers additional information prior to engaging in transactions with others. Despite proposed deterrents such as identity acquisition costs, false referrals through sybil identities pose a significant threat. In this note, we show how a reputation system which multiplicatively chains referrals, and adds referrals from different referral paths/chains, is sybil-proof.