Nonoutsourceable scratch-off puzzles to discourage bitcoin mining coalitions

Andrew Miller, Ahmed Kosba, Jonathan Katz, Elaine Shi

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

An implicit goal of Bitcoin's reward structure is to diffuse network influence over a diverse, decentralized population of individual participants. Indeed, Bitcoin's security claims rely on no single entity wielding a sufficiently large portion of the network's overall computational power. Unfortunately, rather than participating independently, most Bitcoin miners join coalitions called mining pools in which a central pool administrator largely directs the pool's activity, leading to a consolidation of power. Recently, the largest mining pool has accounted for more than half of network's total mining capacity. Relatedly, "hosted mining" service providers offer their clients the benefit of economies-of-scale, tempting them away from independent participation. We argue that the prevalence of mining coalitions is due to a limitation of the Bitcoin proof-of-work puzzle - specifically, that it affords an effective mechanism for enforcing cooperation in a coalition. We present several definitions and constructions for "nonoutsourceable" puzzles that thwart such enforcement mechanisms, thereby deterring coalitions. We also provide an implementation and benchmark results for our schemes to show they are practical.

Original languageEnglish (US)
Title of host publicationCCS 2015 - Proceedings of the 22nd ACM SIGSAC Conference on Computer and Communications Security
PublisherAssociation for Computing Machinery
Pages680-691
Number of pages12
ISBN (Electronic)9781450338325
DOIs
StatePublished - Oct 12 2015
Externally publishedYes
Event22nd ACM SIGSAC Conference on Computer and Communications Security, CCS 2015 - Denver, United States
Duration: Oct 12 2015Oct 16 2015

Publication series

NameProceedings of the ACM Conference on Computer and Communications Security
Volume2015-October
ISSN (Print)1543-7221

Other

Other22nd ACM SIGSAC Conference on Computer and Communications Security, CCS 2015
CountryUnited States
CityDenver
Period10/12/1510/16/15

ASJC Scopus subject areas

  • Software
  • Computer Networks and Communications

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  • Cite this

    Miller, A., Kosba, A., Katz, J., & Shi, E. (2015). Nonoutsourceable scratch-off puzzles to discourage bitcoin mining coalitions. In CCS 2015 - Proceedings of the 22nd ACM SIGSAC Conference on Computer and Communications Security (pp. 680-691). (Proceedings of the ACM Conference on Computer and Communications Security; Vol. 2015-October). Association for Computing Machinery. https://doi.org/10.1145/2810103.2813621