Related papers: Mean Field Game Approach to Bitcoin Mining
Mining in proof-of-work blockchains has become an expensive affair requiring specialized hardware capable of executing several megahashes per second at huge electricity costs. Miners earn a reward each time they mine a block within the…
Blockchain protocols incentivize participation through monetary rewards, assuming rational actors behave honestly to maximize their gains. However, attackers may attempt to harm others even at personal cost. These denial of profit attacks…
In blockchain systems, especially cryptographic currencies such as Bitcoin, the double-spending and Byzantine-general-like problem are solved by reaching consensus protocols among all nodes. The state-of-the-art protocols include…
We study the strategic considerations of miners participating in the bitcoin's protocol. We formulate and study the stochastic game that underlies these strategic considerations. The miners collectively build a tree of blocks, and they are…
This paper deals with the design of the secure blockchain network framework to prevent damages from an attacker. The decentralized network design called the Blockchain Governance Game is a new hybrid theoretical model and it provides the…
Blockchain-based cryptocurrencies secure a decentralized consensus protocol by incentives. The protocol participants, called miners, generate (mine) a series of blocks, each containing monetary transactions created by system users. As…
Although Bitcoin was intended to be a decentralized digital currency, in practice, mining power is quite concentrated. This fact is a persistent source of concern for the Bitcoin community. We provide an explanation using a simple model to…
The mining of bitcoin is modeled using system dynamics, showing that the past evolution of the network hash rate can be explained to a large extent by an efficient market hypothesis applied to the mining of blocks. The possibility of a…
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…
In a Proof-of-Work blockchain such as Bitcoin mining hashrate is increasing in the block reward. An increase in hashrate reduces network vulnerability to attack (a reduction in security cost) while increasing carbon emissions 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…
Recently we could see several institutions coming together to create consortium based blockchain networks such as Hyperledger. Although for applications of blockchain such as Bitcoin, Litcoin, etc. the majority-attack might not be a great…
Blockchain systems often employ proof-of-work consensus protocols to validate and add transactions into hashchains. These protocols stimulate competition among miners in solving cryptopuzzles (e.g. SHA-256 hash computation in Bitcoin) in…
Blockchain technology is a breakthrough in changing the ways of business and organization operations, in which the consensus problem is challenging with practical constraints, such as computational power and consensus standard. In this…
To address the large amount of energy wasted by blockchains, we propose a decentralized consensus protocol for blockchains in which the computation can be used to search for good approximate solutions to any optimization problem. Our…
All public blockchains are secured by a proof of opportunity cost among block producers. For example, the security offered by proof-of-work (PoW) systems, like Bitcoin, is due to spent computation; it is work precisely because it cannot be…
Blockchain is a novel technology that is rising a lot of interest in the industrial and re- search sectors because its properties of decentralisation, immutability and data integrity. Initially, the underlying consensus mechanism has been…
Blockchain consensus is a state whereby each node in a network agrees on the current state of the blockchain. Existing protocols achieve consensus via a contest or voting procedure to select one node as a dictator to propose new blocks.…
In cryptocurrencies, the block reward is meant to serve as the incentive mechanism for miners to commit resources to create blocks and in effect secure the system. Existing systems primarily divide the reward in proportion to expended…
We model and analyze blockchain miners who seek to maximize the compound return of their mining businesses. The analysis of the optimal strategies finds a new equilibrium point among the miners and the mining pools, which predicts the…