Bitcoin: An Impossibility Theorem for Proof-of-Work based Protocols

Jacob Leshno and Philipp Strack ()
Additional contact information
Jacob Leshno: University of Chicago Booth School of Business

No 2204, Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University

Abstract: A key part of decentralized consensus protocols is a procedure for random selection, which is the source of the majority of miners cost and wasteful energy consumption in Bitcoin. We provide a simple economic model for random selection mechanism and show that any PoW protocol with natural desirable properties is outcome equivalent to the random selection mechanism used in Bitcoin.

Keywords: Bitcoin; Random Selection; Proportional Selection Rule; Impossibility Theorem (search for similar items in EconPapers)
JEL-codes: C72 D02 D47 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2019-10
New Economics Papers: this item is included in nep-mic, nep-ore and nep-pay
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://cowles.yale.edu/sites/default/files/files/pub/d22/d2204.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
Working Paper: Bitcoin: An Impossibility Theorem for Proof-of-Work based Protocols (2019)
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:cwl:cwldpp:2204

Ordering information: This working paper can be ordered from
Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA
The price is None.

Access Statistics for this paper

More papers in Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University Yale University, Box 208281, New Haven, CT 06520-8281 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Brittany Ladd ().