Wednesday 19th May 2021
Committee-based blockchains as games between opportunistic players and adversaries with Professor Bruno Biais
Link to seminar recording
We take a game-theoretic approach to consensus in committee-based blockchains. Proposers send blocks to the other committee members, who can check block validity and vote for blocks. Blocks receiving a qualified majority of votes are accepted. Opportunistic players interact with adversaries. All are rational and play best responses, but opportunistic players maximize expected net rewards, while adversaries seek to disrupt blockchain consensus. Freeriding implies the prescribed protocol is not an equilibrium, while there exist equilibria without consensus, even when adversaries are few. There also exists an equilibrium achieving consensus, in which players are endogenously pivotal, which deters free-riding. We propose a simple modification of the prescribed protocol to make this equilibrium a focal point.
Bruno Biais holds a PhD from HEC and is a Professor at the Toulouse School of Economics (CRM/CNRS IDEI). His work has been published in Econometrica, the JPE, the AER, the Review of Economic Studies, the Journal of Finance and the RFS. He taught at HEC, CMU, LBS, Oxford and LSE. He has been a scientific adviser for Euronext and the NYSE. He received the CNRS bronze medal and is a Fellow of the Econometric Society. He has been editor of the Review of Economic Studies and is co-editor of the Journal of Finance.
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