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Greedy-Mine Attacks and Incentive Compatibility in Bitcoin-NG

Article arXiv papers · Author: Junjie Hu et al.
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Summary

Bitcoin-NG organizes each epoch around a key block followed by multiple micro-blocks. Its transaction-fee sharing rule distributes fees between the current and next leader. The document argues that prior incentive analyses omit more persistent adversarial strategies and the possibility of changing mining behavior when a high-value transaction appears.

It proposes Greedy-Mine and models the competition between honest miners and attackers as a Markov decision process. The analysis considers extra attacker rewards and the mining-power conditions under which the strategy can outperform honest mining. It also describes a backward-compatible protocol change that raises the propagation-factor threshold. Simulations and experiments are said to show that Bitcoin-NG is vulnerable and not incentive compatible, though the excerpt gives no quantitative results or implementation details.

Key ideas

  • Bitcoin-NG divides epochs into key blocks and micro-blocks and shares transaction fees across successive leaders.
  • Greedy-Mine is proposed as an adversarial strategy that can alter mining behavior around valuable transactions.
  • A Markov decision process is used to analyze competition between honest miners and adversaries.
  • The study reports simulation and experimental evidence of incentive problems but provides no numerical findings in the excerpt.

Tags

CryptoMarket microstructureRisk managementStatistics
Full text
# Greedy-Mine: A Profitable Mining Attack Strategy in Bitcoin-NG


# Greedy-Mine: A Profitable Mining Attack Strategy in Bitcoin-NG









Bitcoin-NG is an extensible blockchain protocol based on the same trust model as Bitcoin. It divides each epoch into one Key-Block and multiple Micro-Blocks, effectively improving transaction processing capacity. Bitcoin-NG adopts a special incentive mechanism (i.e., the transaction fees in each epoch are split to the current and next leader) to maintain its security. However, there are some limitations to the existing incentive analysis of Bitcoin-NG in recent works. First, the incentive division method of Bitcoin-NG only includes some specific mining attack strategies of adversary, while ignoring more stubborn attack strategies. Second, once adversaries find a whale transaction, they will deviate from honest mining strategy to obtain extra reward. In this paper, we are committed to solving these two limitations. First, we propose a novel mining strategy named Greedy-Mine attack. Then, we formulate a Markov Decision Process (MDP) model to analyze the competition of honest miners and adversaries. Furthermore, we analysis the extra reward of adversaries and summarize the mining power proportion range required for malicious adversaries to launch Greedy-Mine to obtain extra returns. Finally, we make a backward-compatibility progressive modification to Bitcoin-NG protocol that would raise the threshold of propagation factor from 0 to 1. Meanwhile, we get the winning condition of adversaries when adopting Greedy-Mine, compared with honest mining. Simulation and experimental results indicate that Bitcoin-NG is not incentive compatible, which is vulnerable to Greedy-Mine attack.

Shown in full with attribution under the source's licence. Licence: abstract CC0

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.