The Validator’s Dilemma in PoW Blockchain: An Evolutionary Game Perspective
Liang Liu, Qiao Wang, Stephen John Turnbull, Kazumasa Omote · 2023
Mining pools serve as organized structures of miners and play a crucial role in maintaining the stable operation of the blockchain. They are responsible for validating transactions during mining and ensuring their legitimacy to generate new blocks and receive block rewards. Validating does not provide any additional economic benefits. Some mining pools may choose to skip validating the transactions to save time and earn rewards more quickly. This behavior poses a significant threat to the security of the blockchain. However, existing studies have not taken into account the validity of blocks, and it is important to note that skipping validation does not always result in errors. This study has developed a game model to depict the scenario and examined the influence of penalties on mining pool strategies. By employing evolutionary game theory, we investigated the evolution of mining pool strategies and identified the crucial factors that determine strategy choices. Our findings suggest that penalties alone are insufficient to change the equilibrium state of the system. Nevertheless, formulating policies that promote cooperation can effectively resolve the validator’s dilemma and enhance the stability of the blockchain.