Related papers: Coalition-Safe Equilibria with Virtual Payoffs
We study game-theoretic models for capturing participation in blockchain systems. Permissionless blockchains can be naturally viewed as games, where a set of potentially interested users is faced with the dilemma of whether to engage with…
Blockchains and peer-to-peer systems are part of a trend towards computer systems that are "radically decentralised", by which we mean that they 1) run across many participants, 2) without central control, and 3) are such that qualities 1…
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…
Blockchains offer a decentralized and secure execution environment strong enough to host cryptocurrencies, but the state-replication model makes on-chain computation expensive. To avoid heavy on-chain workloads, systems like Truebit and…
This paper examines the economic and security implications of Proof-of-Stake (POS) designs, providing a survey of POS design choices and their underlying economic principles in prominent POS-blockchains. The paper argues that…
We study the problem of providing blockchain applications with \emph{economically viable randomness} (EVR), namely, randomness that has significant economic consequences. Applications of EVR include blockchain-based lotteries and gambling.…
We model incentive security in non-custodial stablecoins and derive conditions for participation in a stablecoin system across risk absorbers (vaults/CDPs) and holders of governance tokens. We apply option pricing theory to derive closed…
As a trusted middleware connecting the blockchain and the real world, the blockchain oracle can obtain trusted real-time price information for financial applications such as payment and settlement, and asset valuation on the blockchain.…
TrueBit is a protocol that uses interactive verification to allow a resource-constrained computation environment like a blockchain to perform much larger computations than usual in a trusted way. As long as a single honest participant is…
We propose a model suggesting that honest-but-rational consensus participants may play timing games, and strategically delay their block proposal to optimize MEV capture, while still ensuring the proposal's timely inclusion in the canonical…
We consider collaborative systems where users make contributions across multiple available projects and are rewarded for their contributions in individual projects according to a local sharing of the value produced. This serves as a model…
Bitcoin is the most successful cryptocurrency so far. This is mainly due to its novel consensus algorithm, which is based on proof-of-work combined with a cryptographically-protected data structure and a rewarding scheme that incentivizes…
PinFi is a class of novel protocols for decentralized pricing of dissipative assets, whose value naturally declines over time. Central to the protocol's functionality and its market efficiency is the role of liquidity providers (LPs). This…
Crowdsourcing has emerged as a paradigm for leveraging human intelligence and activity to solve a wide range of tasks. However, strategic workers will find enticement in their self-interest to free-ride and attack in a crowdsourcing contest…
We study to what extent the Bitcoin blockchain security permanently depends on the underlying distribution of cryptocurrency market outcomes. We use daily blockchain and Bitcoin data for 2014-2019 and employ the ARDL approach. We test three…
Blockchain-based consensus protocols present the opportunity to develop new protocols, due to their novel requirements of open participation and explicit incentivization of participants. To address the first requirement, it is necessary to…
Bitcoin's enormous success has inspired the development of alternative blockchains, such as consortium chains. Several cross-chain protocols have been proposed as ways of connecting these universes of individual blockchains in a distributed…
A notion of pi-tolerant equilibrium is defined that takes into account that players have some tolerance regarding payoffs in a game. This solution concept generalizes Nash and refines epsilon-Nash equilibrium in a natural way. We show that…
Proof-of-work blockchains reward each miner for one completed block by an amount that is, in expectation, proportional to the number of hashes the miner contributed to the mining of the block. Is this proportional allocation rule optimal?…
Bitcoin uses blockchain technology and proof-of-work (PoW) mechanism where nodes spend computing resources and earn rewards in return for spending these resources. This incentive system has caused power to be significantly biased towards a…