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Bitcoin’s Transaction Processing

Bitcoin’s Transaction Processing. Yonatan Sompolinsky joint work with Aviv Zohar. Bitcoin. decentralized cryptocurrency. hard to get easy to pass no authority, no money printing pseudonymous relatively secure high transaction volume.

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Bitcoin’s Transaction Processing

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  1. Bitcoin’s Transaction Processing Yonatan Sompolinsky joint work with Aviv Zohar

  2. Bitcoin decentralized cryptocurrency • hard to get • easy to pass • no authority, no money printing • pseudonymous • relatively secure • high transaction volume current protocol: conflictghost protocol: in accord

  3. Transactions in Bitcoin tx tx tx’ tx tx tx tx tx tx tx’ tx tx tx’ tx tx tx’ tx tx tx tx’ tx’ • irreversible Bob Calvin

  4. The Blockchain txs: txs: txs: ~ 10 min block #83 block #81 block #82 • consistent • grows in time • kept locally at each node Time

  5. Conflicting blockchains maintain one main chain only B1 A the ”longest chain” rule B2 delays => forks blocks discarded & txs cancelled Time

  6. Block tree vs Block chain 3 6 4 λ:= block creation rate = 6 per hourβ:= growth rate of main chain = 4 per hour efficiency:=β/λ=4/6<1 2 1 5 delays => forks => inefficiency Time

  7. Block size, Delay & Efficiency Block Propagation Time 0.95 Efficiency = 0 λ = block creation rateβ= growth rate of main chain • analysis of data provided to us by Decker and Wattenhofer

  8. Throughput (TPS) • Transactions Processed per Second = • (block size) X (growth rate of the main chain) • efficiency 2000 1/600 • TPS < 3.3 why? • TPS ~ 1736

  9. Security - double spend attack tx tx tx main chain Bob Calvin tx’ publish ! secret

  10. Success of attack • computational power needed to create blocks • share of blocks proportional to fraction of computational power • an attacker with computational power will eventually fail • conversely, an attacker with will always succeed • security threshold is thus

  11. Effect of increasing throughput • ↑ • efficiency↓ delay ↑ • TPS ↑ • security ↓

  12. Security limitation on TPS high TPS: more bandwidth needed Bitcoin today: secure butlow throughput TPS vulnerable TPS secure TPS attacker computational power (fraction)

  13. Greedy Heaviest Observed Sub-Tree longest chain • security ↓ efficiency ↓

  14. Greedy Heaviest Observed Sub-Tree main chain according to “longest” rule C1 4 10 D1 B tx B A 5 1 C2 6 1 1 D2 2 main chain according to “ghost” E1 D3 C3 main chain according to “longest” rule tx’ Time

  15. GHOST throughput • no security constraint • hardware constraints, e.g., network congestion, limit the feasible TPS • 8.5-fold increase of current bandwidth can withstandTPS = 2000 • in pipeline: improvement of ghost, same bandwidth more TPS • … • security • high transaction volume

  16. https://eprint.iacr.org/2013/881.pdf

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