Related papers: Mean Field Game Approach to Bitcoin Mining
A new variation of blockchain proof of work algorithm is proposed to incentivize the timely execution of image processing algorithms. A sample image processing algorithm is proposed to determine interesting images using analysis of the…
A \emph{bidding} game is played on a graph as follows. A token is placed on an initial vertex and both players are allocated budgets. In each turn, the players simultaneously submit bids that do not exceed their available budgets, the…
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…
With the rapid growth of hyperconnected devices and decentralized data architectures, safeguarding Internet of Things (IoT) transactions is becoming increasingly challenging. Blockchain presents a promising solution, yet its effectiveness…
Proof-of-Work mining is intended to provide blockchains with robustness against double-spend attacks. However, an economic analysis that follows from Budish (2018), which considers free entry conditions together with the ability to rent…
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 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…
In blockchain networks adopting the proof-of-work schemes, the monetary incentive is introduced by the Nakamoto consensus protocol to guide the behaviors of the full nodes (i.e., block miners) in the process of maintaining the consensus…
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…
Blockchains have witnessed widespread adoption in the past decade in various fields. The growing demand makes their scalability and sustainability challenges more evident than ever. As a result, more and more blockchains have begun to adopt…
Bitcoin's Proof of Work (PoW) mechanism, while central to achieving decentralized consensus, has long been criticized for excessive energy use and hardware inefficiencies \cite{devries2018bitcoin, truby2018decarbonizing}. This paper…
Proof of work blockchain protocols using multiple hash types are considered. It is proven that the security region of such a protocol cannot be the AND of a 51\% attack on all the hash types. Nevertheless, a protocol called Merged Bitcoin…
This is an expanded version of the lecture given at the AMS Short Course on Mean Field Games, on January 13, 2020 in Denver CO. The assignment was to discuss applications of Mean Field Games in finance and economics. I need to admit upfront…
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…
In a PoW-based blockchain network, mining pools (the solo miner could be regarded as a mining pool containing one miner) compete to successfully mine blocks to pursue rewards. Generally, the rewards include the fixed block subsidies and…
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…
We analyze Bitcoin mining from the perspective of a game and propose an optimal mining model that maximizes profits of pools and miners. The model is a two-stage Stackelberg game in which each stage forms a sub-game. In stage I, pools are…
In the literature, existence of mean-field equilibria has been established for discrete-time mean field games under both the discounted cost and the average cost optimality criteria. In this paper, we provide a value iteration algorithm to…
Low transaction throughput and poor scalability are significant issues in public blockchain consensus protocols such as Bitcoins. Recent research efforts in this direction have proposed shard-based consensus protocols where the key idea is…
We study the computation contests where players compete for searching a solution to a given problem with a winner-take-all reward. The search processes are independent across the players and the search speeds of players are proportional to…