TY - JOUR

T1 - Blockchain-based decentralized reward sharing

T2 - the case of mining pools

AU - Gudmundsson, Jens

AU - Hougaard, Jens Leth

PY - 2024

Y1 - 2024

N2 - We introduce a reciprocity protocol, an innovative approach to coordinating and sharing rewards in blockchains. Inherently decentralized and implementable, it puts emphasis on incentives rather than forcing specific sharing rules from the outset. Analyzing the non-cooperative game the protocol induces, we identify a robust, strict, and Pareto-dominant symmetric equilibrium. In it, even self-centered participants show extensive systemic reciprocity. Thus, despite a setting that is generally unfavorable to reciprocal behavior, the protocol enables users to build trust between themselves by taking on a role akin to a social contract.

AB - We introduce a reciprocity protocol, an innovative approach to coordinating and sharing rewards in blockchains. Inherently decentralized and implementable, it puts emphasis on incentives rather than forcing specific sharing rules from the outset. Analyzing the non-cooperative game the protocol induces, we identify a robust, strict, and Pareto-dominant symmetric equilibrium. In it, even self-centered participants show extensive systemic reciprocity. Thus, despite a setting that is generally unfavorable to reciprocal behavior, the protocol enables users to build trust between themselves by taking on a role akin to a social contract.

U2 - 10.1145/3641120

DO - 10.1145/3641120

M3 - Journal article

VL - 12

JO - ACM Transactions on Economics and Computation

JF - ACM Transactions on Economics and Computation

SN - 2167-8375

IS - 1

M1 - 4

ER -