Unruly by Design: Fee Volatility and Strategic Attacks in Bitcoin Mining

Fabian Schär, Dario Thürkauf and David Yermack

No 35443, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We develop a model of aberrant behavior by Bitcoin miners and test it with a new 2017-2025 dataset. Miners’ rewards, comprised partly of user fees, exhibit variability across blocks of transactions. When large reward disparities exist between adjacent blocks, miners have incentives to attempt alternative versions of prior blocks and claim other miners’ rewards for themselves. Regression analysis shows that fee differentials are associated with these attacks and longer waiting times between blocks. These patterns imply potential destabilization of the Bitcoin blockchain as future mining rewards become more volatile due to gradual withdrawal of fixed block subsidies.

JEL-codes: G23 (search for similar items in EconPapers)
Date: 2026-07
Note: LE ME
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.nber.org/papers/w35443.pdf (application/pdf)
Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:35443

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w35443
The price is Paper copy available by mail.

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().