Related papers: On Profitability of Trailing Mining
We review the so called selfish mining strategy in the Bitcoin network and compare its profitability to honest mining.We build a rigorous profitability model for repetition games. The time analysis of the attack has been ignored in the…
We compute and compare profitabilities of stubborn mining strategies that are variations of selfish mining. These are deviant mining strategies violating Bitcoin's network protocol rules. We apply the foundational set-up from our previous…
Many of the recent works on the profitability of rogue mining strategies hinge on a parameter called $\gamma$ that measures the proportion of the honest network attracted by the attacker to mine on top of his fork. These works, see…
Mining blocks on a blockchain equipped with a proof of work consensus protocol is well-known to be resource-consuming. A miner bears the operational cost, mainly electricity consumption and IT gear, of mining, and is compensated by a…
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…
The resource-consuming mining of blocks on a blockchain equipped with a proof of work consensus protocol bears the risk of ruin, namely when the operational costs for the mining exceed the received rewards. In this paper we investigate to…
Bitcoin is firmly becoming a mainstream asset in our global society. Its highly volatile nature has traders and speculators flooding into the market to take advantage of its significant price swings in the hope of making money. This work…
We calculate the probability of success of block-hiding mining strategies in Bitcoin-like networks. These strategies involve building a secret branch of the block-tree and publishing it opportunistically, aiming to replace the top of the…
Bitcoin is a "crypto currency", a decentralized electronic payment scheme based on cryptography. Bitcoin economy grows at an incredibly fast rate and is now worth some 10 billions of dollars. Bitcoin mining is an activity which consists of…
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…
Since Bitcoin's inception in 2008, it has became attractive investments for both trading and mining. To mine Bitcoins, a miner has to invest in computing power and pay for electricity to solve cryptographic puzzles for rewards, if it…
Most current assessments use ex post proxies that miss uncertainty and fail to consistently capture the rapid change in bitcoin mining. We introduce a unified, ex ante statistical model that derives expected return, downside risk, and…
Bitcoin mining presents a significant economic incentive for efficient hashing and broadcast of data, both parameters stemming from the Proofs of Work used to advance the network. This incentive has led to the development of Bitcoin…
Mining processes of Bitcoin and similar cryptocurrencies are currently incentivized with voluntary transaction fees and fixed block rewards which will halve gradually to zero. In the setting where optional and arbitrary transaction fee…
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…
Nakamoto double spend strategy, described in Bitcoin foundational article, leads to total ruin with positive probability and does not make sense from the profitability point of view. The simplest strategy that can be profitable incorporates…
For a mining strategy we define the notion of "profit lag" as the minimum time it takes to be profitable after that moment. We compute closed forms for the profit lag and the revenue ratio for the strategies "selfish mining" and…
Bitcoin draws the highest degree of attention among cryptocurrencies, while coin mining is one of the most important fashion of profiting in the Bitcoin ecosystem. This paper constructs fresh coin circulation networks by tracking the fresh…
Bitcoin uses blockchain technology to maintain transactions order and provides probabilistic guarantee to prevent double-spending, assuming that an attacker's computational power does not exceed %50 of the network power. In this paper, we…
In this study, we examine the behavior and profitability of modern malware that mines cryptocurrency. Unlike previous studies, we look at the cryptocurrency market as a whole, rather than just Bitcoin. We not only consider PCs, but also…