Related papers: Bitcoin: A Natural Oligopoly
Mining is a central operation of all proof-of-work (PoW) based cryptocurrencies. The vast majority of miners today participate in "mining pools" instead of "solo mining" in order to lower risk and achieve a more steady income. However, this…
Blockchains revolutionized centralized sectors like banking and finance by promoting decentralization and transparency. In a blockchain, information is transmitted through transactions issued by participants or applications. Miners…
Cryptocurrencies that are based on Proof-of-Work (PoW) often rely on special purpose hardware to perform so-called mining operations that secure the system, with miners receiving freshly minted tokens as a reward for their work. A notable…
Mining fairness in blockchain refers to equality between the computational resources invested in mining and the block rewards received. There exists a dilemma wherein increasing the transaction processing capacity of a blockchain…
Bitcoin is a popular cryptocurrency that records alltransactions in a distributed append-only public ledger calledblockchain. The security of Bitcoin heavily relies on the incentive-compatible proof-of-work (PoW) based distributed consensus…
Bitcoin-NG, a scalable blockchain protocol, divides each block into a key block and many micro blocks to effectively improve the transaction processing capacity. Bitcoin-NG has a special incentive mechanism (i.e. splitting transaction fees…
In recent years, cryptocurrencies have attracted growing attention from both private investors and institutions. Among them, Bitcoin stands out for its impressive volatility and widespread influence. This paper explores the predictability…
Bitcoin is a digital currency designed to rely on a decentralized, trustless network of anonymous agents. Using a pseudonymous-address-linking procedure that achieves >99% sensitivity and >99% specificity, we reveal that between launch…
Seminal work of Eyal and Sirer (2014) establishes that a strategic Bitcoin miner may strictly profit by deviating from the intended Bitcoin protocol, using a strategy now termed *selfish mining*. More specifically, any miner with $>1/3$ of…
We argue that the current POW based consensus algorithm of the Bitcoin network suffers from a fundamental economic discrepancy between the real world transaction (txn) costs incurred by miners and the wealth that is being transacted. Put…
Explaining changes in bitcoin's price and predicting its future have been the foci of many research studies. In contrast, far less attention has been paid to the relationship between bitcoin's mining costs and its price. One popular notion…
The world-changing blockchain technique provides a novel method to establish a secure, trusted and decentralized system for solving the security and personal privacy problems in Industrial Internet of Things (IIoT) applications. The mining…
We study a game-theoretic model of blockchain mining economies and show that griefing, a practice according to which participants harm other participants at some lesser cost to themselves, is a prevalent threat at its Nash equilibria. The…
What happens to mining when the Bitcoin price changes, when there are mining supply shocks, the price of energy changes, or hardware technology evolves? We give precise answers based on the technical forces and incentives in the system. We…
It has been known for some time that the Nakamoto consensus as implemented in the Bitcoin protocol is not totally aligned with the individual interests of the participants. More precisely, it has been shown that block withholding mining…
Background: During the last years, there has been a lot of discussion and estimations on the energy consumption of Bitcoin miners. However, most of the studies are focused on estimating energy consumption, not in exploring the factors that…
This work proposes a novel proof-of-work blockchain incentive scheme such that, barring exogenous motivations, following the protocol is guaranteed to be the optimal strategy for miners. Our blockchain takes the form of a directed acyclic…
We propose a bitcoin generalization as a solution to the problem of scalability. The block is redefined as a sequence of sub-blocks of increasing sizes that coexist as different levels of compromise between decentralization and transactions…
Cryptocurrencies have gained popularity due to their transparency, security, and accessibility compared to traditional financial systems, with Bitcoin, introduced in 2009, leading the market. Bitcoin's security relies on blockchain…
This paper investigates whether Bittensor can be considered the Bitcoin of decentralized Artificial Intelligence by directly comparing its tokenomics, decentralization properties, consensus mechanism, and incentive structure against those…