A Template for Alternative Proof of Work for Cryptocurrencies (original) (raw)

Lecture Notes in Computer Science, 2016

We study cryptocurrency protocols that do not make use of Proof of Work. Such protocols commonly rely on Proof of Stake, i.e. on mechanisms that extend voting power to the stakeholders of the system. We offer analysis of existing protocols that have a substantial amount of popularity. We then present our novel pure Proof of Stake protocols, and argue that the they help in mitigating problems that the existing protocols suffer from.

Nonlinear Proof-Of-Work: Improving the Energy Efficiency of Bitcoin Mining

Journal of construction project management and innovation, 2020

Bitcoin is probably the most well-known blockchain system in existence. It employs the proofof-work (PoW) consensus algorithm to add transactions to the blockchain. This process is better known as Bitcoin mining. PoW requires miners to compete in solving a cryptographic puzzle before being allowed to add a block of transactions to the blockchain. This mining process is energy-intensive and results in high energy wastage. The underlying cause of this energy inefficiency is the result of the current implementation of the PoW algorithm. PoW assigns the same cryptographic puzzle to all miners, creating a linear probability of success between the miner's computational power as a proportion of the total computational power of the network. To address this energy inefficiency of the PoW mining process, the researchers investigated whether a nonlinear probability of success, between the miner's computation power and its probability of success, will result in better energy usage. A nonlinear proof-ofwork (nlPoW) algorithm was constructed by using a design science approach to derive the requirements for and structure of the algorithm. The Bitcoin mining process was tested through statistical simulation, comparing the performance of nlPoW with PoW. Preliminary results, simulating a network of 1000 miners with identical computational power, indicate that nlPoW reduce the number of hash computations, and therefore the energy consumption, required by Bitcoin mining. The findings are significant because nlPoW does not reduce the degree of decentralised consensus, or trade energy usage for some other resource as is the case with many other attempts to address the energy consumption problem in PoW.

Proofs of Work for Blockchain Protocols

2017

One of the most impactful applications of proofs of work (POW) currently is in the design of blockchain protocols such as Bitcoin. Yet, despite the wide recognition of POWs as the fundamental cryptographic tool in this context, there is no known cryptographic formulation that implies the security of the Bitcoin blockchain protocol. Indeed, all previous works formally arguing the security of the Bitcoin protocol relied on direct proofs in the random oracle model, thus circumventing the di culty of isolating the required properties of the core POW primitive. In this work we ll this gap by providing a formulation of the POW primitive that implies the security of the Bitcoin blockchain protocol in the standard model. Our primitive entails a number of properties that parallel an e cient non-interactive proof system: completeness and fast veri cation, security against malicious provers (termed hardness against tampering and chosen message attacks ) and security for honest provers (termed ...

Blockchain and Consensus from Proofs of Work without Random Oracles

2018

PoX: Proof of Transfer Mining with Bitcoin

2020

StrongChain: Transparent and Collaborative Proof-of-Work Consensus

USENIX Security, 2019

Bitcoin is the most successful cryptocurrency so far. This is mainly due to its novel consensus algorithm, which is based on proof-of-work combined with a cryptographically-protected data structure and a rewarding scheme that incen-tivizes nodes to participate. However, despite its unprecedented success Bitcoin suffers from many inefficiencies. For instance, Bitcoin's consensus mechanism has been proved to be incentive-incompatible, its high reward variance causes centralization, and its hardcoded deflation raises questions about its long-term sustainability. In this work, we revise the Bitcoin consensus mechanism by proposing StrongChain, a scheme that introduces transparency and incentivizes participants to collaborate rather than to compete. The core design of our protocol is to reflect and utilize the computing power aggregated on the blockchain which is invisible and "wasted" in Bitcoin today. Introducing relatively easy, although important changes to Bitcoin's design enables us to improve many crucial aspects of Bitcoin-like cryptocurrencies making it more secure, efficient , and profitable for participants. We thoroughly analyze our approach and we present an implementation of StrongChain. The obtained results confirm its efficiency, security , and deployability.

Efficient Blockchain System based on Proof of Segmented Work

2020 IEEE Region 10 Symposium (TENSYMP)

The use of Blockchain in Cryptocurrency introduces a technology that acts as an unswervingly growing ledger with the capability to keep an everlasting record of all the transactions that have taken place, in a secure chronological and immutable system. It removes dependency on central financial service providers such as banks, essentially removing the middleman from the transaction. Bitcoin is one of the biggest users in blockchain and holds the highest share in the cryptocurrency market. However, bitcoin has three major problems which are excessive power consumption, confirmation time and fair reward distribution. Hence, we are proposing a system where we have tried to reduce energy consumption by limiting the participation of all the nodes in the network and worked on increasing the propagation speed in the network. Finally, we have put a lot of emphasis on the concept of fair reward distribution which is not considered in most cryptocurrencies. Apart from this, we tried to prove our systems efficiency by comparing the energy consumption with the two most used crypto currencies Bitcoin and Ethereum mathematically. And have reached the conclusion, that our proposed system shall reduce energy consumption by about 80.0% and 46.68% when compared with Bitcoin and Ethereum if each node in our network consumed the equivalent energy as an average node in the bitcoin network, on the otherhand, 92.41% and 79.76% if each node in our network consumed the equivalent energy as an average node in the ethereum network.

Proof of Transfer Whitepaper v1.0 PoX: Proof of Transfer Mining with Bitcoin

Consensus algorithms for public blockchains require computing or financial resources to secure the blockchain state. Mining mechanisms used by these algorithms are broadly divided into proof-of-work, in which nodes dedicate computing resources, and proof-of-stake, in which nodes dedicate financial resources to participate in the consensus algorithm. The high-level idea behind both proof-of-work and proof-of-stake is to make it practically infeasible for any single malicious actor to have enough computing power or ownership stake to attack the network. A variant of proof-of-work is proof-of-burn where miners compete by "burning" (destroying) a proof-of-work cryptocurrency as a proxy for computing resources. In this paper, we introduce a new mining mechanism, called proof-of-transfer (PoX) that generalizes the concept of proof-of-burn. PoX uses the proof-of-work cryptocurrency of an established blockchain to secure a new blockchain. However, unlike proof-of-burn rather than burning the cryptocurrency, miners transfer the committed cryptocurrency to some other participant(s) in the network. This allows network participants who are adding value to the new cryptocurrency network to earn a reward in a base cryptocurrency by actively participating in the consensus algorithm. PoX encourages a model where there is one extremely secure proof-of-work blockchain, say Bitcoin. Other new blockchains can be anchored on the secure proof-of-work blockchain instead of introducing new proof-of-work chains. PoX has the interesting property where participants can earn payouts in a separate, potentially more stable, base cryptocurrency while participating in the new blockchain network. This can help solve a bootstrapping problem for new blockchains by providing incentives for early participants. Further, PoX has a potential use case for funding ecosystem developer funds. We present a proposal for using PoX in the Stacks 2.0 blockchain.

Can We Afford Integrity by Proof-of-Work? Scenarios Inspired by the Bitcoin Currency

Workshop on the Economics of Information Security WEIS, 2012

Abstract: Proof-of-Work (PoW), a well-known principle to ration resource access in client-server relations, is about to experience a renaissance as a mechanism to protect the integrity of a global state in distributed transaction systems under decentralized control. Most prominently, the Bitcoin cryptographic currency protocol leverages PoW to 1) prevent double spending and 2) establish scarcity, two essential properties of any electronic currency. This paper asks the important question whether this approach is generally viable. Citing actual ...

Multi-stage Proof-of-Works: Properties and Vulnerabilities

2021

Since its appearance in 2008, Bitcoin has attracted considerable attention. So far, it has been the most successful cryptocurrency, with the highest market capitalization. Nevertheless, due to the method it uses to append new transactions and blocks to the blockchain, based on a Proof-ofWork, Bitcoin suffers from poor scalability, which strongly limits the number of transactions per second and, hence, its adoption as a global payment layer for everyday uses. In this paper we analyze some recent proposals to address this issue. In particular, we focus our attention on permissionless blockchain protocols, whose distributed consensus algorithm lies on a Proof-of-Work composed of k > 1 sequential hash-puzzles, instead of a single one. Such protocols are referred to as multi-stage Proof-of-Works. We consider a simplified scenario, commonly used in the blockchain literature, in which the number of miners, their hashing powers, and the difficulty values of the hash-puzzles are constant ...

A Template for Alternative Proof of Work for Cryptocurrencies (original) (raw)

Related papers