Related papers: Bitcoin: A Natural Oligopoly
Bitcoin is the first and undoubtedly most successful cryptocurrecny to date with a market capitalization of more than 100 billion dollars. Today, Bitcoin has more than 100,000 supporting merchants and more than 3 million active users.…
Proof-of-Work is a consensus algorithm where miners solve cryptographic puzzles to mine blocks and obtain a reward through some Block Reward Mechanism (BRM). PoW blockchain faces the problem of centralization due to the formation of mining…
The security of Bitcoin protocols is deeply dependent on the incentives provided to miners, which come from a combination of block rewards and transaction fees. As Bitcoin experiences more halving events, the protocol reward converges to…
Cryptocurrencies employ auction-esque transaction fee mechanisms (TFMs) to allocate transactions to blocks, and to determine how much fees miners can collect from transactions. Several impossibility results show that TFMs that satisfy a…
This paper investigates whether Bitcoin can be regarded as a decentralized autonomous organization (DAO), what insights it may offer for the broader DAO ecosystem, and how Bitcoin governance can be improved. First, a quantitative literature…
Decentralized payment systems such as Bitcoin have become massively popular in the last few years, yet there is still much to be done in understanding their formal properties. The vast majority of decentralized payment systems work by…
We give an explicit definition of decentralization and show you that decentralization is almost impossible for the current stage and Bitcoin is the first truly noncentralized currency in the currency history. We propose a new framework of…
We study selfish mining in Ethereum. The problem is combinatorially more complex than in Bitcoin because of major differences in the reward system and a different difficulty adjustment formula. Equivalent strategies in Bitcoin do have…
A decentralized blockchain is a distributed ledger that is often used as a platform for exchanging goods and services. This ledger is maintained by a network of nodes that obeys a set of rules, called a consensus protocol, which helps to…
Bitcoin mining is a wasteful and resource-intensive process. To add a block of transactions to the blockchain, miners spend a considerable amount of energy. The Bitcoin protocol, named 'proof of work' (PoW), resembles a lottery and the…
Bitcoin has become the leading cryptocurrency system, but the limit on its transaction processing capacity has resulted in increased transaction fees and delayed transaction confirmation. As such, it is pertinent to understand and probably…
We develop a model of coordination and allocation of decentralized multi-sided markets, in which our theoretical analysis is promisingly optimizing the decentralized transaction packaging process at high-throughput blockchains or Web 3.0…
This paper presents an agent-based artificial cryptocurrency market in which heterogeneous agents buy or sell cryptocurrencies, in particular Bitcoins. In this market, there are two typologies of agents, Random Traders and Chartists, which…
We analyze the first and second moment risk premia in the Bitcoin market based on options and realized returns and contrast them to the premia embedded in the main US stock index market. First, Bitcoin is much more volatile and has a higher…
The selfish mining attack, arguably the most famous game-theoretic attack in blockchain, indicates that the Bitcoin protocol is not incentive-compatible. Most subsequent works mainly focus on strengthening the selfish mining strategy, thus…
Bitcoin constructs temporal order internally rather than synchronizing to any external clock. Empirical evidence shows that its time evolution is non-continuous, probabilistic, and self-regulated. Block discovery follows a stochastic…
Blockchain technology relies on decentralization to resist faults and attacks while operating without trusted intermediaries. Although industry experts have touted decentralization as central to their promise and disruptive potential, it is…
This study explores the intersection of technological innovation and environmental sustainability in the context of Bitcoin mining. With Bitcoin's growing adoption, concerns surrounding the energy consumption and environmental impact of…
More than ten years ago the blockchain was acclaimed as the solution to overcome centralised trusted third parties for online payments. Through the years the crypto-movement changed and evolved, although decentralisation remained the core…
This study examines the weak form of the efficient market hypothesis for Bitcoin using a feedforward neural network. Due to the increasing popularity of cryptocurrencies in recent years, the question has arisen, as to whether market…