Home > Vol 1 (2016) > Houy The Bitcoin Mining Game Abstract This article deals with the mining incentives in the Bitcoin protocol.The mining process is used to confirm and secure transactions.This process is organized as a speed game between individuals or firms – the miners – with different computational powers to solve a mathematical problem, bring a proof of work, spread their solution and reach consensus among the Bitcoin network nodes with it.First, we define and specify this game.Second, we analytically find its Nash equilibria in the two-player case.We analyze the parameters for which the miners would face the proper incentives to fulfill their function of transaction processors in the current situation.Finally, we study the block space market offer.Keywords Full Text: PDF Open Review References Andresen G.(2013) “Back-of-the-envelope calculations for marginal cost of transactions,” /gavinandresen/5044482.Accessed 3 March 2014.

(2014) "On subversive miner strategies and block withholding attack in Bitcoin digital currency," arXiv: 1402.1718.Decker C. and Wattenhofer R.(2013) "Information propagation in the Bitcoin network," 13th IEEE Interna- tional Conference on Peer-to-Peer Computing (P2P), Trento, Italy, September 2013.Eyal I. and Sirer E.G.(2013) "Majority is not enough: Bitcoin mining is vulnerable," arXiv: 1311.0243.(2014) "The miner’s dilemma," arXiv: 1411.7099.(2014) "It will cost you nothing to ’kill’ a proof-of-stake crypto-currency," Economics Bulletin, 34(2): 1038-1044.(2014) "The economics of Bitcoin transaction fees", Working paper GATE 2014-07.Kroll J.A., Davey I.C.(2013) "The economics of Bitcoin mining, or Bitcoin in the presence of adversaries," Mimeo.Lewenberg A., Bachrach Y., Sompolinsky Y., Zohar A. and Rosenschein J.S.(2015) "Bitcoin mining pools: A cooperative game theoretic analysis," Proceeding AAMAS ’15 Proceedings of the 2015 International Conference on Autonomous Agents and Multiagent Systems: 919-927.

(2009) "Bitcoin: a peer-to-peer electronic cash system."(2015) "A transaction fee market exists without a block size limit."Sapirshtein A., Sompolinsky Y. and Zohar A.(2015) "Optimal selfish mining strategies in Bitcoin," arXiv: 1507.06183.(2015) "An examination of single transaction blocks and their effect on network throughput and block size."Accessed 20 December 2015./10.5195/ledger.2016.13 Refbacks There are currently no refbacks.Copyright (c) 2016 Nicolas Houy This work is licensed under a Creative Commons Attribution 4.0 International License.Instructor: Prof. Foteini Baldimtsi (foteini@gmu.edu) Office Hours: Lectures: Class Website: Course Summary This class will serve as an introduction to the exciting new world of blockchain technologies.We will start our journey studying Bitcoin (the cryptocurrency everyone talks about) which is one of the first popular application of blockchains.We will study in detail how bitcoins are generated/mined, how transactions are being made and how the blockchain makes it possible to keep everything secure, fast and reliable without depending in any ``trusted party'' such as a government or a financial institution.

We will explain the limitations of Bitcoin and will explore new systems and cryptocurrency proposals that overcome them.Then, we will look at the smart contract technology that enforces the automated execution of electronic commitments among parties without the need for a mediator.bitcoin exchange egyptFinally, we will explore further applications of blockchain such as identity management or distributed data storage.bitcoin fbi salePrerequisites: No specific prerequisites.etotheipi bitcoinFamiliarity with networks, security and cryptography will be helpful.ghs bitcoin chartThere will also be some programming assignments and students should be familiar with programming in C, Java or another language.bitcoin geenstijl

Required Materials Text Book: Arvind Narayanan, Joseph Bonneau, Edward Felten, Andrew Miller, Steven Goldfeder.Bitcoin and Cryptocurrency Technologies: A Comprehensive Introduction, Princeton University Press, 2016.Grading Homeworks: (2 assignments that will require both programming and problem solving) Paper Presentation: Labs: Class Participation: Final Project: Communications: We will use piazza to communicate with you and upload HWs and Labs.bitcoin fight clubYou are welcome to use Piazza to set up study groups, to post interesting security incidents you read about (please tag these as "interesting incident in the news"), or to discuss the course with other students.If you have a question about the course you should: (a) Come to office hours, OR (b) Post to Piazza.You are welcome to post to Piazza anonymously, but please don't use private posts to ask technical questions.

The rest of the class is probably also interested in your question, so make it public!Ethics: You have to read and follow the GMU honor code.Welcome to our weekly bitcoin news recap, where we cover top headlines and stories in the world of bitcoin each week.This week we had the chance to see first hand what the White House thinks about bitcoin, and Blockchain Co-Founder Nic Cary was a guest speaker at the World Government Summit in Dubai.There are new developments and updates in bitcoin, plus we have some bitcoin protips to share, all in this week’s Blockchain recap.Ed Felten: What does the White House think of cryptocurrencies such as bitcoin?In a Quora post this week, Ed Felten, Deputy U.S.Chief Technology Officer, commented on what the White House thinks of bitcoin, including the recent bitcoin block size debate saying: “I am also watching with interest the debate within the Bitcoin community about the block size limit.(To be clear, the government is paying attention to that debate but are not participating in it.)

This is a challenge to Bitcoin’s governance model, because it requires the community to come to a consensus on an issue where there seem to be high stakes and plausible arguments on each side.” Interestingly enough, former Clinton adviser, Alec Ross recently offered some predictions about a few things including bitcoin.Ross is predicting that bitcoin will eventually become mainstream.And according Reuters, financial regulators are warming up to new uses for “blockchain” technology, which promises tamper-proof communication and makes many types of transactions far more secure, Blythe Masters, the head of one firm in the market said.Blockchain is about to transform everything we know about banking and doing business At the World Government Summit in Dubai being held Feb.8 to 10, world leaders and grey-haired bureaucrats from the United Nations, World Bank, and other agencies discussed how governments can help their countries’ people adapt to relentless social and technological change.

Nic Cary, Co-Founder of London-based Blockchain sees the future more clearly than most — and he believes the Internet and Bitcoin will together create a global network of trust that will transform not just the way we bank, but how we do business and how citizens interact with governments.Can fintech restore our trust in the financial system?For the Internet of Things (IoT) to have a transformational effect on society, it needs to be backed up by a similarly cutting edge financial system.Thanks to the development of block chain (the technology behind the crypto currency bitcoin), we now have the opportunity to democratise the financial system and let people who do not know or trust each other complete an economic transaction without relying on an intermediary.Valve introducing Bitcoin transactions to Steam Valve looks set to introduce bitcoin payments to its digital distribution platform Steam, according to references found on Steam’s translation servers.The move will make the enormously popular platform the first major gaming service to support bitcoin.

South Korea’s KB Kookmin Bank is developing a blockchain solution for international remittances with the aim of ushering in “safer and faster” foreign exchange services.Chinese bitcoin exchange Bitfinex has announced that it plans to release new mobile apps for Android and iOS.Bitcoin Classic has published their new source code for users who are looking for a modest jump to 2mb, which indicates what could perhaps be a new phase in the ongoing debate whether or how to scale the Bitcoin network’s transaction capacity.The Bitcoin Classic team includes developers Gavin Andresen, Jeff Garzik, Blockchain team member, Pedro Pinheiro, Tom Zander, and Jon Rumion.Are you new to Bitcoin?Following the fast-paced bitcoin and blockchain industry can be tough.Here are some tips and tricks to navigate the space quickly and stay well informed.If you’re looking for the right fee amount for your bitcoin transaction, 21 Inc the maker of the Bitcoin Computer, has launched a free web app that can help bitcoin users determine what level of fee will ensure a transaction is confirmed in a given amount of time.