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Can Blockchain Stay Fair for the Long Haul?
- Protocols like Bitcoin, Algorand, and Ouroboros Praos allow resource holders to participate directly in the protocol, with block producers forming pools in PoW and PoS systems.
- Pool leaders validate transactions in PoW, while in PoS, leaders control block creation and members delegate staking rights to the leader.
- Temporal discounting influences pooling behavior, with small miners preferring frequent small payments over rare large payments.
- Systems like Cosmos and EOS restrict participation in consensus, requiring parties without enough stake to delegate rights to a validator.
- The security of a ledger relies on honest majority participation, with concentration of power among few entities posing a threat.
- Concerns include liveness, safety, and stability hazards from power concentration and behavior of block proposers in blockchain systems.
- Smart contracts enable MEV-type attacks, impacting stability; the proposer-builder separation model aims to mitigate these attacks.
- In PoS systems, lack of self-healing poses a threat as adversaries can retain control indefinitely by prohibiting power shifts during temporary takeovers.
- A diverse stake distribution is crucial for protecting against takeovers in PoS systems.
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