From: Runchao Han <runchao.han@monash.edu>
Message-Id: <29C07E1A-DC6B-49F0-893B-A59E7BD8DB1C@monash.edu>
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Date: Mon, 9 Dec 2019 11:45:27 +1100
In-Reply-To: <mailman.3482.1575825776.25512.bitcoin-dev@lists.linuxfoundation.org>
To: Cheng Wang <cheng@alephium.org>
References: <mailman.3482.1575825776.25512.bitcoin-dev@lists.linuxfoundation.org>
Cc: bitcoin-dev@lists.linuxfoundation.org
Subject: Re: [bitcoin-dev] Reducing energy consumption and increasing
	security	at the same time
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Hi Cheng,

This is an interesting proposal!
While the incentive analysis is sound, I have two concerns:

## What if a guy keeps mining easy blocks to launch 51% attacks?

With PoLW, a miner can sacrifice the coinbase reward as much as possible =
to mine blocks faster.
If the blockchain follows the longest chain rule, PoLW may make 51% =
attacks much easier.
An easy way of fixing this is to choose the chain with most work rather =
than most blocks.

## What if the coinbase tx is no longer the majority of mining reward, =
but the fx fee?

This might happen in the future.
A possible solution is to limit the number of txs for easy blocks.
For example, if a miner chooses to mine blocks N times easier, he can =
only include txs of which the total size is <=3D (block_size - =
metadata_size) / N.

Best regards,
Runchao

> Date: Sun, 8 Dec 2019 11:43:49 +0100
> From: Cheng Wang <cheng@alephium.org>
> To: bitcoin-dev@lists.linuxfoundation.org
> Subject: [bitcoin-dev] Reducing energy consumption and increasing
> 	security	at the same time
> Message-ID:
> 	=
<CAJgZxF4G_BjJ=3DOhuzhjfZtkePnEc2hz8DMZzFzWKBNh17XhBeQ@mail.gmail.com>
> Content-Type: text/plain; charset=3D"utf-8"
>=20
> Hi Everyone,
>=20
> I would like to share my serious work on reducing the energy =
consumption of
> PoW without sacrificing security. My new type of algorithm is called =
PoLW.
> For a practical system where mining is profitable, PoLW could actually
> improve the security of the system.
>=20
> The idea is to shift part of the external cost of mining in the =
physical
> world (mainly energy consumption) to the internal cost of the network. =
In
> PoLW, the miners are able to give up part of the coinbase reward so as =
to
> get weight (> 1) for the block hash they produce. The total cost of
> generating a new block would still be equal to maximal coinbase reward =
in
> equilibrium.
>=20
> I analyzed two algorithms in the paper: linear PoLW and exponential =
PoLW.
> Linear PoLW could reduce energy consumption by a factor close to 1/2 =
in
> equilibrium, while exponential PoLW could reduce energy consumption by =
an
> arbitrary factor in equilibrium.
>=20
> In a practical system, mining is usually (if not always) profitable. =
If we
> transition from PoW to PoLW, the external costs of mining would =
decrease
> and the internal costs will increase. However, the decrease in =
external
> costs would be less than the increase in internal costs since mining =
is
> profitable. The total cost of block generation would get higher, =
therefore,
> the security will increase.
>=20
> Of course, we could not decrease the external costs of any existing =
system
> by a factor close to zero immediately. There is a section in my paper
> discussing this particularly. The principle of applying PoLW is that
> keeping the absolute external cost increasing all the time, but the
> percentage of external cost in the total cost gets lower eventually.
>=20
> This work is based on solid math calculation, and I am looking forward =
to
> feedback and discussions. My paper is available at:
> https://github.com/alephium/research/raw/master/polw.pdf
>=20
> It's inspired by the recent great paper of Itay, Alexander, and Ittay:
> https://arxiv.org/abs/1911.04124
>=20
> Best,
> Cheng Wang


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<html><head><meta http-equiv=3D"Content-Type" content=3D"text/html; =
charset=3Dus-ascii"></head><body style=3D"word-wrap: break-word; =
-webkit-nbsp-mode: space; line-break: after-white-space;" class=3D""><div =
class=3D"">Hi Cheng,</div><div class=3D""><br class=3D""></div>This is =
an interesting proposal!<div class=3D"">While the incentive analysis is =
sound, I have two concerns:</div><div class=3D""><br class=3D""></div><div=
 class=3D"">##&nbsp;<span style=3D"font-family: &quot;Helvetica =
Neue&quot;; font-size: 13px;" class=3D"">What if a guy keeps mining easy =
blocks to launch 51% attacks?</span></div><div class=3D""><span =
style=3D"font-family: &quot;Helvetica Neue&quot;; font-size: 13px;" =
class=3D""><br class=3D""></span></div><div class=3D""><font =
face=3D"Helvetica Neue" size=3D"2" class=3D"">With PoLW, a miner can =
sacrifice the coinbase reward as much as possible to mine blocks =
faster.</font></div><div class=3D""><font face=3D"Helvetica Neue" =
size=3D"2" class=3D"">If the blockchain follows the&nbsp;longest chain =
rule, PoLW may make 51%&nbsp;attacks much easier.</font></div><div =
class=3D""><font face=3D"Helvetica Neue" size=3D"2" class=3D"">An easy =
way of fixing this is to choose the chain with most work rather than =
most blocks.</font></div><div class=3D""><br class=3D""></div><div =
class=3D"">## What if the coinbase tx is no longer the majority of =
mining reward, but the fx fee?</div><div class=3D""><br =
class=3D""></div><div class=3D"">This might happen in the =
future.</div><div class=3D"">A possible solution is to limit the number =
of txs for easy blocks.</div><div class=3D"">For example, if a miner =
chooses to mine blocks N times easier, he can only include txs of which =
the total size is &lt;=3D (block_size - metadata_size) / N.</div><div =
class=3D""><br class=3D""></div><div class=3D"">Best regards,</div><div =
class=3D"">Runchao</div><div class=3D""><br class=3D""></div><div =
class=3D""><div><blockquote type=3D"cite" class=3D""><div class=3D""><div =
class=3D"">Date: Sun, 8 Dec 2019 11:43:49 +0100<br class=3D"">From: =
Cheng Wang &lt;<a href=3D"mailto:cheng@alephium.org" =
class=3D"">cheng@alephium.org</a>&gt;<br class=3D"">To: <a =
href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" =
class=3D"">bitcoin-dev@lists.linuxfoundation.org</a><br =
class=3D"">Subject: [bitcoin-dev] Reducing energy consumption and =
increasing<br class=3D""><span class=3D"Apple-tab-span" =
style=3D"white-space:pre">	</span>security<span =
class=3D"Apple-tab-span" style=3D"white-space:pre">	</span>at the =
same time<br class=3D"">Message-ID:<br class=3D""><span =
class=3D"Apple-tab-span" style=3D"white-space:pre">	</span>&lt;<a =
href=3D"mailto:CAJgZxF4G_BjJ=3DOhuzhjfZtkePnEc2hz8DMZzFzWKBNh17XhBeQ@mail.=
gmail.com" =
class=3D"">CAJgZxF4G_BjJ=3DOhuzhjfZtkePnEc2hz8DMZzFzWKBNh17XhBeQ@mail.gmai=
l.com</a>&gt;<br class=3D"">Content-Type: text/plain; charset=3D"utf-8"<br=
 class=3D""><br class=3D"">Hi Everyone,<br class=3D""><br class=3D"">I =
would like to share my serious work on reducing the energy consumption =
of<br class=3D"">PoW without sacrificing security. My new type of =
algorithm is called PoLW.<br class=3D"">For a practical system where =
mining is profitable, PoLW could actually<br class=3D"">improve the =
security of the system.<br class=3D""><br class=3D"">The idea is to =
shift part of the external cost of mining in the physical<br =
class=3D"">world (mainly energy consumption) to the internal cost of the =
network. In<br class=3D"">PoLW, the miners are able to give up part of =
the coinbase reward so as to<br class=3D"">get weight (&gt; 1) for the =
block hash they produce. The total cost of<br class=3D"">generating a =
new block would still be equal to maximal coinbase reward in<br =
class=3D"">equilibrium.<br class=3D""><br class=3D"">I analyzed two =
algorithms in the paper: linear PoLW and exponential PoLW.<br =
class=3D"">Linear PoLW could reduce energy consumption by a factor close =
to 1/2 in<br class=3D"">equilibrium, while exponential PoLW could reduce =
energy consumption by an<br class=3D"">arbitrary factor in =
equilibrium.<br class=3D""><br class=3D"">In a practical system, mining =
is usually (if not always) profitable. If we<br class=3D"">transition =
from PoW to PoLW, the external costs of mining would decrease<br =
class=3D"">and the internal costs will increase. However, the decrease =
in external<br class=3D"">costs would be less than the increase in =
internal costs since mining is<br class=3D"">profitable. The total cost =
of block generation would get higher, therefore,<br class=3D"">the =
security will increase.<br class=3D""><br class=3D"">Of course, we could =
not decrease the external costs of any existing system<br class=3D"">by =
a factor close to zero immediately. There is a section in my paper<br =
class=3D"">discussing this particularly. The principle of applying PoLW =
is that<br class=3D"">keeping the absolute external cost increasing all =
the time, but the<br class=3D"">percentage of external cost in the total =
cost gets lower eventually.<br class=3D""><br class=3D"">This work is =
based on solid math calculation, and I am looking forward to<br =
class=3D"">feedback and discussions. My paper is available at:<br =
class=3D""><a =
href=3D"https://github.com/alephium/research/raw/master/polw.pdf" =
class=3D"">https://github.com/alephium/research/raw/master/polw.pdf</a><br=
 class=3D""><br class=3D"">It's inspired by the recent great paper of =
Itay, Alexander, and Ittay:<br =
class=3D"">https://arxiv.org/abs/1911.04124<br class=3D""><br =
class=3D"">Best,<br class=3D"">Cheng Wang<br =
class=3D""></div></div></blockquote></div><br =
class=3D""></div></body></html>=

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