Subscribe to the gold package and get unlimited access to Shamra Academy
Register a new userOn Decentralization of Bitcoin: An Asset Perspective
272
0
0.0
(
0
)
Added by
Ling Cheng
Publication date
2021
fields
Informatics Engineering
and research's language is
English
Ask ChatGPT about the research
No Arabic abstract
Since its advent in 2009, Bitcoin, a cryptography-enabled peer-to-peer digital payment system, has been gaining increasing attention from both academia and industry. An effort designed to overcome a cluster of bottlenecks inherent in existing centralized financial systems, Bitcoin has always been championed by the crypto community as an example of the spirit of decentralization. While the decentralized nature of Bitcoins Proof-of-Work consensus algorithm has often been discussed in great detail, no systematic study has so far been conducted to quantitatively measure the degree of decentralization of Bitcoin from an asset perspective -- How decentralized is Bitcoin as a financial asset? We present in this paper the first systematic investigation of the degree of decentralization for Bitcoin based on its entire transaction history. We proposed both static and dynamic analysis of Bitcoin transaction network with quantifiable decentralization measures developed based on network analysis and market efficiency study. Case studies are also conducted to demonstrate the effectiveness of our proposed metrics.
rate research
Read More
Bitcoin is a cryptocurrency attracting a lot of interest both from the general public and researchers. There is an ongoing debate on the question of users anonymity: while the Bitcoin protocol has been designed to ensure that the activity of individual users could not be tracked, some methods have been proposed to partially bypass this limitation. In this article, we show how the Bitcoin transaction network can be studied using complex networks analysis techniques, and in particular how community detection can be efficiently used to re-identify multiple addresses belonging to a same user.
Bitcoin has become the leading cryptocurrency system, but the limit on its transaction processing capacity has resulted in increased transaction fees and delayed transaction confirmation. As such, it is pertinent to understand and probably predict how transactions are handled by Bitcoin such that a user may adapt the transaction requests and a miner may adjust the block generation strategy and/or the mining pool to join. To this aim, the present paper introduces results from an analysis of transaction handling in Bitcoin. Specifically, the analysis consists of two-part. The first part is an exploratory data analysis revealing key characteristics in Bitcoin transaction handling. The second part is a predictability analysis intended to provide insights on transaction handling such as (i) transaction confirmation time, (ii) block attributes, and (iii) who has created the block. The result shows that some models do reasonably well for (ii), but surprisingly not for (i) or (iii).
Bitcoin is the first and undoubtedly most successful cryptocurrecny to date with a market capitalization of more than 100 billion dollars. Today, Bitcoin has more than 100,000 supporting merchants and more than 3 million active users. Besides the trust it enjoys among people, Bitcoin lacks of a basic feature a substitute currency must have: stability of value. Hence, although the use of Bitcoin as a mean of payment is relative low, yet the wild ups and downs of its value lure investors to use it as useful asset to yield a trading profit. In this study, we explore this exact nature of Bitcoin aiming to shed light in the newly emerged and rapid growing marketplace of cryptocurencies and compare the investmet landscape and patterns with the most popular traditional stock market of Dow Jones. Our results show that most of Bitcoin addresses are used in the correct fashion to preserve security and privacy of the transactions and that the 24/7 open market of Bitcoin is not affected by any political incidents of the offline world, in contrary with the traditional stock markets. Also, it seems that there are specific longitudes that lead the cryptocurrency in terms of bulk of transactions, but there is not the same correlation with the volume of the coins being transferred.
Information leakage rate is an intuitive metric that reflects the level of security in a wireless communication system, however, there are few studies taking it into consideration. Existing work on information leakage rate has two major limitations due to the complicated expression for the leakage rate: 1) the analytical and numerical results give few insights into the trade-off between system throughput and information leakage rate; 2) and the corresponding optimal designs of transmission rates are not analytically tractable. To overcome such limitations and obtain an in-depth understanding of information leakage rate in secure wireless communications, we propose an approximation for the average information leakage rate in the fixed-rate transmission scheme. Different from the complicated expression for information leakage rate in the literature, our proposed approximation has a low-complexity expression, and hence, it is easy for further analysis. Based on our approximation, the corresponding approximate optimal transmission rates are obtained for two transmission schemes with different design objectives. Through analytical and numerical results, we find that for the system maximizing throughput subject to information leakage rate constraint, the throughput is an upward convex non-decreasing function of the security constraint and much too loose security constraint does not contribute to higher throughput; while for the system minimizing information leakage rate subject to throughput constraint, the average information leakage rate is a lower convex increasing function of the throughput constraint.
Clients of permissionless blockchain systems, like Bitcoin, rely on an underlying peer-to-peer network to send and receive transactions. It is critical that a client is connected to at least one honest peer, as otherwise the client can be convinced to accept a maliciously forked view of the blockchain. In such an eclipse attack, the client is unable to reliably distinguish the canonical view of the blockchain from the view provided by the attacker. The consequences of this can be catastrophic if the client makes business decisions based on a distorted view of the blockchain transactions. In this paper, we investigate the design space and propose two approaches for Bitcoin clients to detect whether an eclipse attack against them is ongoing. Each approach chooses a different trade-off between average attack detection time and network load. The first scheme is based on the detection of suspicious block timestamps. The second scheme allows blockchain clients to utilize their natural connections to the Internet (i.e., standard web activity) to gossip about their blockchain views with contacted servers and their other clients. Our proposals improve upon previously proposed eclipse attack countermeasures without introducing any dedicated infrastructure or changes to the Bitcoin protocol and network, and we discuss an implementation. We demonstrate the effectiveness of the gossip-based schemes through rigorous analysis using original Internet traffic traces and real-world deployment. The results indicate that our protocol incurs a negligible overhead and detects eclipse attacks rapidly with high probability, and is well-suited for practical deployment.
Log in to be able to interact and post comments
comments
Fetching comments
Sign in to be able to follow your search criteria
