Blockchain Competition Between Miners: A Game Theoretic Perspective
Journal article, 2020
We model the competition over mining resources and over several cryptocurrencies as a non-cooperative game. Leveraging results about congestion games, we establish conditions for the existence of pure Nash equilibria and provide efficient algorithms for finding such equilibria. We account for multiple system models, varying according to the way that mining resources are allocated and shared and according to the granularity at which mining puzzle complexity is adjusted. When constraints on resources are included, the resulting game is a constrained resource allocation game for which we characterize a normalized Nash equilibrium. Under the proposed models, we provide structural properties of the corresponding types of equilibrium, e.g., establishing conditions under which at most two mining infrastructures will be active or under which no miners will have incentives to mine a given cryptocurrency.
Author
Eitan Altman
Institut National de Recherche en Informatique et en Automatique (INRIA)
Daniel Menasché
Federal University of Rio de Janeiro
Alexandre Reiffers-Masson
Indian Institute of Science
Mandar Datar
Institut National de Recherche en Informatique et en Automatique (INRIA)
Swapnil Vilas Dhamal
Laboratoire Informatique d'Avignon
Institut National de Recherche en Informatique et en Automatique (INRIA)
Corinne Touati
Institut National de Recherche en Informatique et en Automatique (INRIA)
Rachid El-Azouzi
Laboratoire Informatique d'Avignon
Frontiers in Blockchain
Vol. 2 26
Areas of Advance
Information and Communication Technology
Subject Categories
Control Engineering
Computer Science
Computer Systems
DOI
10.3389/fbloc.2019.00026