Blockchain protocol reduces honest nodes needed to prevent double spending
STAKE: Preventing a colluding majority from double spending
Computer Science and Game Theory
Summary
Blockchains usually need most participants to be honest to avoid fraud like double spending. This paper presents a new blockchain protocol called STAKE that can work securely even if only about a third of participants are honest. It achieves this by requiring participants to put up a stake related to their resources, making attacks less profitable and less likely. The authors show the chance of repeated double spending attacks drops quickly, discouraging dishonest collusion.
What this means in practice
- •For blockchain developers: Build blockchain networks that tolerate fewer honest nodes while preventing double spending through staking mechanisms.
- •For cryptocurrency platform operators: Design consensus protocols that reduce the required honest majority, improving network robustness against colluding participants.
Authors
Zahra Naderi, Vincent Gramoli
Abstract
Blockchains typically operate in open networks where it is hard to control the delay of messages. While classic blockchain protocols assumed synchrony, newer protocols try to remain secure despite unexpected network delays. Unfortunately, in the traditional model where $n$ participants can either be honest or Byzantine, we need a supermajority, or $\lfloor 2n/3\rfloor + 1$, of them to be honest. Recent work have explored the question of reducing the number of needed honest nodes in a game theory model to a majority sometimes by introducing $k$ rational players and $t$ Byzantine players. Yet, to our knowledge, no blockchain protocol managed to reduce it further. In this paper, we offer a blockchain protocol called Secure and Tolerant Algorithm through ($k,t$)-robust Equilibrium (STAKE) that works with only $\lfloor n/3\rfloor + 1$ honest players. STAKE requires each consensus participant to stake a sufficiently large amount $s$ compared to their liquidity $\ell$. We show that the probability that a coalition manages to execute $ζ$ double spending attacks (we call them a $ζ$-uple attack) drops polynomially fast with $ζ$. This allows us to demonstrate that STAKE reaches a ($k,t$)-robust equilibrium, or that rational players do not collude with Byzantine, even with a relatively low $s/\ell$ ratio.