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A discrete-event simulation model for the Bitcoin blockchain network with strategic miners and mining pool managers
- Source :
- Computers & Operations Research. 134:105365
- Publication Year :
- 2021
- Publisher :
- Elsevier BV, 2021.
-
Abstract
- As the first and most famous cryptocurrency-based blockchain technology, Bitcoin has attracted tremendous attention from both academic and industrial communities in the past decade. A Bitcoin network is comprised of two interactive parties: individual miners and mining pool managers, each of which strives to maximize its own utility. In particular, individual miners choose which mining pool to join and decide on how much mining power to commit under limited constraints on the mining budget and mining power capacity; managers of mining pools determine how to allocate the mining reward and how to adjust the membership fee. In this work we investigate the miners’ and mining pool managers’ decisions in repeated Bitcoin mining competitions by building a Monte-Carlo discrete-event simulation model. Our simulation model (i) captures the behavior of these two parties and how their decisions affect each other, and (ii) characterizes the system-level dynamics of the blockchain in terms of the mining difficulty level and total mining power. In addition, we study the sensitivity of system performance metrics with respect to various control parameters. Our analysis may provide useful guidelines to mining activity participants in the Bitcoin network.
- Subjects :
- 0209 industrial biotechnology
Cryptocurrency
021103 operations research
General Computer Science
Computer science
0211 other engineering and technologies
InformationSystems_DATABASEMANAGEMENT
Power capacity
02 engineering and technology
Commit
Management Science and Operations Research
Data science
ComputingMethodologies_PATTERNRECOGNITION
020901 industrial engineering & automation
Work (electrical)
Modeling and Simulation
Discrete event simulation
Control parameters
Subjects
Details
- ISSN :
- 03050548
- Volume :
- 134
- Database :
- OpenAIRE
- Journal :
- Computers & Operations Research
- Accession number :
- edsair.doi...........427081a4020d63455538d3af32fa33de