Blockchain Mining Games with Pay Forward
This addresses security and fairness issues in blockchain protocols for participants, though it appears incremental as it adds a new option to existing mining games.
The paper tackles the problem of strategic manipulation in blockchain mining by introducing a 'pay forward' option that allows miners to influence incentives for extending their branch, showing that smaller miners can ensure more powerful miners follow the intended protocol behavior.
We study the strategic implications that arise from adding one extra option to the miners participating in the bitcoin protocol. We propose that when adding a block, miners also have the ability to pay forward an amount to be collected by the first miner who successfully extends their branch, giving them the power to influence the incentives for mining. We formulate a stochastic game for the study of such incentives and show that with this added option, smaller miners can guarantee that the best response of even substantially more powerful miners is to follow the expected behavior intended by the protocol designer.