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How to Win at Bitcoin

Philip Lazos (Sapienza University of Rome)
speaker DIAG: 
Data dell'evento: 
Giovedì, 7 Novembre, 2019 - 14:00
DIAG - Via Ariosto 25, Room A4

We formulate and study the stochastic game of miners that participate in the bitcoin protocol. We consider the possible beneficial deviations a miner can have: the simplest strategy is to release every mined block immediately, but be strategic on which blocks to mine. The second, more complicated strategy, is to withhold mined blocks so that the other miners cannot use them, and release them in a misleading way. We show that when the computational power of each miner is relatively small, their best response matches the expected behaviour of the bitcoin designer, leading to an efficient PNE. However, when the computational power of a miner is large, he deviates from the expected behaviour and significantly improves his payoffs.


Bio Sketch: Philip Lazos graduated at University of Oxford in 2019 with a thesis on Online Market Algorithms under the supervision of Elias Koustoiupias.  He is currently a postdoctoral researcher at Sapienza University of Rome supported by the ERC Advanced Grant Project Algorithmic and Mechanism Design Research in Online MArkets (AMDROMA) 

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