Game of Coins

The cryptocurrency market is blooming. Tens of new coins emerge every year and their total market cap keeps growing. The research community is trying to keep up by proposing improved mining protocols and attacking existing ones. However, surprisingly as it may sound, most existing works overlook the real-life multi-coin market, by focusing on a system with a single coin. To the best of our knowledge, this paper was the first to consider a system with many coins and strategic miners that are free to choose where to mine. We first formalize the current practice of strategic mining in multi-coin markets as a singleton weighted congestion game and prove that any better-response dynamics in such a game converges to an equilibrium. Then, in our main result, we present a reward design attack that moves the system configuration from any initial equilibrium to a desired one. The attack is executed via temporary manipulation of coin rewards, which leads strategic miners to switch between coins. It applies to any better-response dynamics of the miners. To motivate our attack we show that in any equilibrium there is always at least one miner whose profit is higher in a different one, and thus may benefit from such an attack.