Template-type: ReDif-Paper 1.0
Author-Name: Can, Burak
Author-workplace-name: RS: FSE DKE Mathematics Centre Maastricht, Data Analytics and Digitalisation, RS: GSBE other - not theme-related research
Author-Name: Hougaard, Jens Leth
Author-Name: Pourpouneh, Mohsen
Title: On Reward Sharing in Blockchain Mining Pools
Abstract: This paper proposes a conceptual framework for the analysis of reward sharing schemes in mining pools, such as those associated with Bitcoin. The framework is centered around the reported shares in a pool instead of agents and results in two new fairness criteria, absolute and relative redistribution. These criteria impose that the addition of a share to the pool affects all previous shares in the same way, either in absolute amount or in relative ratio. We characterize two large classes of economically viable reward sharing schemes corresponding to each of these fairness criteria in turn. We further show that the intersection of these classes brings about a generalization of the well-known proportional scheme, which also leads to a new characterization of the proportional scheme as a corollary.
Classification-JEL: d63,g20,l86,d31
Series: GSBE Research Memoranda
Creation-Date: 20210527
Number: 009
File-URL: https://cris.maastrichtuniversity.nl/ws/files/64723171/RM21009.pdf
File-Format: application/pdf
File-Size: 734077
Handle: Repec:unm:umagsb:2021009
DOI: 10.26481/umagsb.2021009