A blockchain is a distributed data ledger. Each blockchain participant stores a local copy of the ledger. Various protocols, some more energy-efficient than others, are used to ensure the consistency of the ledger. The instant consensus protocol, studied for decades, has the advantage of being energy efficient. Participants must agree to add a transaction, for example, to the ledger before the protocol can be run. Understanding and anticipating the potential behavior of participants is crucial for blockchains to work effectively.
The instant consensus protocol can be compromised when the number of malicious participants—those who never respond or voluntarily send inconsistent information—exceeds a certain threshold. However, there are also those who are not malicious but are instead motivated purely to maximize their gains. Typically, they never check the validity of the blocks submitted to them.
Researchers at CEA List, a member of the Carnot Network, based its work on the theory of non-cooperative games. This is a mathematical tool that analyzes the decision-making processes of individuals in a group. The researchers showed that new rules are required to guarantee the successful completion and integrity of a transaction. Simply “rewarding” users who do check blocks is not enough; there must also be a significant cost associated with adding an invalid block, and this must apply to the entire community.
The research is still in progress, analyzing other existing incentive mechanisms and developing new ones. One approach is currently being rolled out to Connecting Food, a startup working with CEA List to develop a solution that provides real-time monitoring of a food product’s compliance with its specifications at every stage of manufacturing and distribution, from farm to shelf. Incentives will encourage those involved in the process (producers, processors, etc.) to enter their certificates into the blockchain, providing consumers with greater transparency.
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