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arXiv:1801.03998cs.CR

Decentralization in Bitcoin and Ethereum Networks

Adem Efe Gencer, Soumya Basu, Ittay Eyal, Robbert van Renesse, Emin Gün Sirer

Abstract

Blockchain-based cryptocurrencies have demonstrated how to securely implement traditionally centralized systems, such as currencies, in a decentralized fashion. However, there have been few measurement studies on the level of decentralization they achieve in practice. We present a measurement study on various decentralization metrics of two of the leading cryptocurrencies with the largest market capitalization and user base, Bitcoin and Ethereum. We investigate the extent of decentralization by measuring the network resources of nodes and the interconnection among them, the protocol requirements affecting the operation of nodes, and the robustness of the two systems against attacks. In particular, we adapted existing internet measurement techniques and used the Falcon Relay Network as a novel measurement tool to obtain our data. We discovered that neither Bitcoin nor Ethereum has strictly better properties than the other. We also provide concrete suggestions for improving both systems.

arXiv comments
Financial Cryptography and Data Security 2018
Journal reference
Financial Cryptography and Data Security (FC) 2018
DOI
Subjects
cs.CRCryptography and Security

On Hacker News

Linked by 2 identifiable commenters in 5 comments across 3 threads, from Apr 2018 to May 2018. Found in 2 HN submissions from Feb 2018 to Feb 2022. Open submission discussions.

Comments linking this paper, per year.

Discussed in comments3 threads

  1. New study quantifies Bitcoin’s ludicrous energy consumption 1 comment

    • One example that the US government's OFAC is considering is blacklisting addresses and tainted UTXOs [0]. Miners would be forbidden by law to confirm a transaction related to a tainted UTXO. This means if the transaction is spending a tainted UTXO or sending to a blacklisted…

      hudonView on HNParent context

  2. Is Buying Crypto Assets “Investing” 3 comments

    • > One value of Bitcoin is in its decentralization. There is surmounting evidence that this is not true and that Bitcoin is actually quite centralized and would benefit from being more centralized [0][1][2][3][4]. [0] https://arxiv.org/abs/1801.03998 [1]…

      hudonView on HNParent context

    • Thanks for these links, usually when talking about it not being decentralized the source is either Forbes or Business Insider. Let's see what your sources have in store. EDIT: [0] https://arxiv.org/abs/1801.03998 Good paper, lots of good research. Identifies that top pools do…

      JommiView on HNParent context

    • > However, fails to notice that pools are made of individual miners/groups and do not represenet single huge datacenters. Groups/individuals can often change pools, and this is not an uncommon practice. citation needed. The trend in proof-of-work mining is consolidation of costs…

      hudonView on HNParent context

  3. Ethereum Sharding FAQ 1 comment

    • I've been actively researching use cases and properties of cryptocurrencies (more than 15 minutes) and have come to the opposite conclusion: none of the hype is based in fact. For instance, let's go through your claims one by one. > Decentralization, There is surmounting…

      hudonView on HNParent context

Submitted to Hacker News

  • Alternative Services for Blockchain?1 point0 comments

    In his recent critique of cryptocurrency/blockchain systems, David Rosenthal cites a study on crypto "decentralization" which claims a Byzantine Quorum of size >= 20 would provide a more robust "decentralized" solution than Bitcoin or Ethereum (https://arxiv.org/pdf/1801.03998.pdf). Are there any existing services that offer something akin to what he describes? If not that particular design, are there other alternatives worth looking into?

  • Decentralization in Bitcoin and Ethereum Networks1 point0 comments

Connected through shared HN threads, not inferred similarity or a recommendation.