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The Evolutionary Equilibrium of Block Withholding Attack

Author

Listed:
  • Cheng Yukun

    (School of Business, Suzhou University of Science and Technology, Suzhou215009, China)

  • Xu Zhiqi

    (School of Business, Suzhou University of Science and Technology, Suzhou215009, China)

  • Yao Shuangliang

    (Jiangsu University of Science and Technology, Zhenjiang212008, China)

Abstract

Bitcoin is the most famous and the most used cryptocurrency in the world, such that it has received extreme popularity in recent years. However the Bitcoin system is accompanied by different attacks, including the block withholding (BWH) attack. When a miner plays the BWH attack, it will withhold all the blocks newly discovered in the attack pool, damaging the honest miners’ right to obtain the fair reward. In this paper, we consider a setting in which two miners may honestly mine or perform the BWH attack in a mining pool. Different strategy profiles will bring different payoffs, in addition influence the selection of the strategies. Therefore, we establish an evolutionary game model to study the behavior tendency of the miners and the evolutionary stable strategies under different conditions, by formulating the replicator dynamic equations. Through numerical simulations, we further verify the theoretical results on evolutionary stable solutions and discuss the impact of the factors on miners’ strategic choice. Based on these simulation results, we also make some recommendations for the manager and the miners to mitigate the BWH attack and to promote the cooperation between miners in a mining pool.

Suggested Citation

  • Cheng Yukun & Xu Zhiqi & Yao Shuangliang, 2021. "The Evolutionary Equilibrium of Block Withholding Attack," Journal of Systems Science and Information, De Gruyter, vol. 9(3), pages 266-279, June.
    • Handle: RePEc:bpj:jossai:v:9:y:2021:i:3:p:266-279:n:1
    DOI: 10.21078/JSSI-2021-266-14
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    References listed on IDEAS

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    1. Cardell, Judith B. & Hitt, Carrie Cullen & Hogan, William W., 1997. "Market power and strategic interaction in electricity networks," Resource and Energy Economics, Elsevier, vol. 19(1-2), pages 109-137, March.
    2. Wu, Di & Liu, Xiang-dong & Yan, Xiang-bin & Peng, Rui & Li, Gang, 2019. "Equilibrium analysis of bitcoin block withholding attack: A generalized model," Reliability Engineering and System Safety, Elsevier, vol. 185(C), pages 318-328.
    3. Daniel Friedman, 1998. "On economic applications of evolutionary game theory," Journal of Evolutionary Economics, Springer, vol. 8(1), pages 15-43.
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