Selfish Mining in Proof of Work Blockchains

Abstract

A proof of work (PoW) blockchain distributes the mining revenue proportionally to all the miners. However, the mining pools that are large enough may decide to deviate from the protocol by applying the selfish mining strategy to gain more revenue for themselves and less for the others who follow the protocol. The scale of the benefits that the selfish miners will achieve over time depends on the probability that the honest miners will choose to mine of the blocks from the selfish pool.

In this work we conduct the network simulations to investigate on the different network condition under which the honest miners accept the blocks from the selfish pool. Our simulator is configured to capture the performance of today’s world wide web and the global network of Bitcoin miners. We experiment with the different sizes and geographical distributions of the selfish pool and conclude that the geographical distribution impacts the scale of the benefits the selfish pool will be able to achieve. It is not only important that the selfish pool has the sufficient mining power, but is also crucial for it to be well-connected to a substantial amount of honest miners.

Refs

• Ittay Eyal and Emin Gün Sirer. Majority is not enough: Bitcoin mining is vulnerable.
• Yusuke Aoki, Kai Otsuki, Takeshi Kaneko, Ryohei Banno, and Kazuyuki Shudo. Simblock: A blockchain network simulator. IEEE INFOCOM 2019.
• Ryunosuke Nagayama, Ryohei Banno, and Kazuyuki Shudo. Identifying impacts of protocol and internet development on the bitcoin network. In 2020 IEEE Symposium on Computers and Communications (ISCC).