Selfish Behavior in the Tezos Proof-of-Stake Protocol
Michael Neuder, Daniel J. Moroz, Rithvik Rao, David C. Parkes · 2020
Proof-of-Stake consensus protocols give rise to complex modeling challenges.We analyze the Babylon update (October 2019) to the Proof-of-Stake protocol on the Tezos blockchain, and demonstrate that, under certain conditions, rational participants are incentivized to behave dishonestly.In doing so, we provide a theoretical analysis of the feasibility and profitability of a block stealing attack that we call selfish endorsing, a concrete instance of an attack previously only theoretically considered.We propose and analyze a simple change to the Tezos protocol which significantly reduces the (already small) profitability of this dishonest behavior, and introduce a new delay and reward scheme that is provably secure against length-1 and length-2 selfish endorsing attacks.Our framework provides a template for analyzing other Proof-of-Stake protocols for the possibility of selfish behavior.