Voting-Based Semi-Parallel Proof-of-Work Protocol

TL;DR

The paper tackles the vulnerability of Nakamoto consensus to incentive attacks by evaluating parallel PoW schemes and introducing a voting-based semi-parallel PoW protocol. The proposed design separates proofs from ledgers, employs ledger elections based on transaction-fee incentives, and uses a heaviest-aggregate-work fork rule with semi-sequential parallelism to reduce overhead and conflicts. Through theoretical analysis and MDР-based simulations, it demonstrates improved resistance to double-spending, more stable rewards, and fair fee distribution, while maintaining practicality in communication and throughput. The work advances the state of PoW protocols by offering a hybrid approach that mitigates incentive attacks and enhances scalability, with clear pathways for implementation and extension.

Abstract

Parallel Proof-of-Work (PoW) protocols are suggested to improve the safety guarantees, transaction throughput and confirmation latencies of Nakamoto consensus. In this work, we first consider the existing parallel PoW protocols and develop hard-coded incentive attack structures. Our theoretical results and simulations show that the existing parallel PoW protocols are more vulnerable to incentive attacks than the Nakamoto consensus, e.g., attacks have smaller profitability threshold and they result in higher relative rewards. Next, we introduce a voting-based semi-parallel PoW protocol that outperforms both Nakamoto consensus and the existing parallel PoW protocols from most practical perspectives such as communication overheads, throughput, transaction conflicts, incentive compatibility of the protocol as well as a fair distribution of transaction fees among the voters and the leaders. We use state-of-the-art analysis to evaluate the consistency of the protocol and consider Markov decision process (MDP) models to substantiate our claims about the resilience of our protocol against incentive attacks.

Figures (10)

• Figure 1: Bobtail protocol proof model.
• Figure 2: Relative revenues of withholding attacks on existing variations of parallel PoW protocols.
• Figure 3: The proof model of the semi-parallel PoW protocol with $L=7$. Orange and black circles represent the initiator and incremental proofs and the numbers inside the circles represent the incremental heights. Each initiator proof refers to a ledger from the previous block height as the winning ledger. Blue boxes represent the winning ledgers based on the most aggregate work fork choice rule. Here, if the proof $7$ of block $h+2$ is the most recent proof with most aggregate work and $b=1$, the ledgers until block height $h+1$ are confirmed, since they are part of the most aggregate work chain. But, ledger $\omega_6^{h+2}$ is not $b=1$-confirmed since $1$-confirmation requires $1$-complete block on height $h+3$ where the initiator of block $h+3$ needs to refer to $\omega_6^{h+2}$ as the winning ledger. Red dotted boxes (e.g., block $h$) together with a valid ledger (e.g., $\omega_6^h$) are considered as a complete block. Note that, block $h$ with ledger $\omega_7^h$ is a complete but orphan block. To replace the block $h$ and its associated ledger $\omega_6^h$ with the block $h$ and its associated ledger $\omega_7^h$ in the view of honest miners, the adversary creates an initiator proof that refers to $\omega_7^h$. The adversary has to create further proofs and share complete blocks at block height $h+1$ and $h+2$ to make the block $h$ and its associated ledger $\omega_7^h$ as the fork choice rule (most aggregate work). Note that the adversary cannot use any proofs of block $h+1$ or $h+2$ in the figure since initiator proof of the block $h+1$ refers to $\omega_6^h$ as the winning ledger and all the subsequent proofs build on top of this initiator proof. Thus, to rewrite the history, adversary has to work alone once it falls behind in the race of most aggregate work.
• Figure 4: $1$-block confirmation rule with $L$ proofs, $\alpha=0.25$.
• Figure 5: Relative revenues of withholding attacks.

Theorems & Definitions (7)

• Lemma 1
• Lemma 2
• Lemma 3
• Lemma 4
• Lemma 5
• Theorem 1
• Lemma 6