International Association for Cryptologic Research

International Association
for Cryptologic Research

IACR News item: 30 September 2014

Juan Garay, Aggelos Kiayias, Nikos Leonardos
ePrint Report ePrint Report
Bitcoin is the first and most popular decentralized cryptocurrency to date.

In this work, we extract and analyze the core of the Bitcoin

protocol, which we term the Bitcoin {\\em backbone}, and prove two of

its fundamental properties which we call {\\em common prefix} and {\\em chain

quality}. Our proofs hinge

on appropriate and novel assumptions on the ``hashing power\'\' of the

adversary relative to network synchronicity; our results are shown

to be tight under high synchronization.

Next, we

propose and analyze applications that can be built ``on top\'\' of the

backbone protocol, specifically focusing on Byzantine agreement (BA)

and on the notion of a public transaction ledger.

Regarding BA, we observe that Nakamoto\'s suggestion falls short of solving it,

and present a simple alternative

which works assuming that the adversary\'s

hashing power is bounded by $1/3$.

The public transaction ledger

captures the essence of Bitcoin\'s operation as a cryptocurrency,

in the sense that it guarantees the

``liveness\'\' and ``persistence\'\' of committed transactions.

Based on this notion

we describe and analyze the Bitcoin system

as well as

a more elaborate BA protocol,

proving them secure assuming high network synchronicity and that the

adversary\'s hashing power is strictly less than $1/2$, while the

adversarial bound needed for security decreases as the network desynchronizes.

Expand

Additional news items may be found on the IACR news page.