With a transaction fee market and without a block size limit in Bitcoin network; there exists a Nash equilibrium points of the mining game

Abstract

We are interested in mining incentives in the Bitcoin protocols. The blockchain Bitcoin. The mining process is used to confirm and secure all transactions in the network. This process is organized as a speed game between individuals or groups, referred to as “miners” or “pools of miners”, respectively. Miners or pools of miners use different computational powers to solve a mathematical problem, obtain a proof-of-work, spread their solution, and this solution is verified by the community before the block is added in the only public blockchain replicated over all nodes. First, we define and specify this game in the case with n players, n ≥ 2 , under the assumptions denoted by (H) below. Next, we analytically find its Nash equilibrium points. In other words, we generalize the idea of [1] by taking into account the hypotheses of Peter Rizun’s paper [2], through cumbersome computations. Our purpose here is to show some intuitions about the model rather than derive applicable results.