Decentralized Fair Mining Pools Using Burn Chain Leader Selection

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Solution Overview

Problem

Existing blockchain implementations face inefficiencies in leader selection, leading to energy wastage, bias towards nodes with cheap energy or excessive computing power, and vulnerability to malicious actors altering transaction history.

Innovation Solution

A blockchain single-leader election algorithm using a burn chain and stack chain structure, where nodes register public keys and submit block commits with burned cryptocurrency, with selection based on the amount burned, reducing energy consumption and bias, and resolving forks by the longest chain rather than resource consumption.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Reliability

If proof of work is used for leader selection, then network security is improved, but energy consumption increases

Engineering Contradiction:

Improvenetwork securityVSAvoidenergy consumption

Core Design Contradiction:

ReliabilityVSUse of energy by moving object

Solution Approach 1:

The system segments the blockchain into two separate chains: a burn chain for leader selection and a stack chain for transaction processing. This segmentation allows proof of work to be performed only on the burn chain for leader selection, while the stack chain uses a more energy-efficient validation mechanism, thereby reducing overall energy consumption while maintaining security.

Inventive Principle:

Principle #1Segmentation

Solution Approach 2:

The burn chain acts as an intermediary between participants and the stack chain. Leaders are selected through proof of work on the burn chain, and this selection mediates access to the stack chain where transactions are processed. This intermediary structure separates the energy-intensive leader selection from transaction processing, reducing total energy usage.

Inventive Principle:

Principle #24Intermediary (Mediator)

2Productivity

If nodes with more computing power are used for leader selection, then transaction validation speed is improved, but bias towards wealthy nodes increases

Engineering Contradiction:

Improvetransaction validation speedVSAvoidfairness in leader selection

Core Design Contradiction:

ProductivityVSEase of operation

Solution Approach 1:

The system changes the selection parameter from pure computing power to a combination of proof of work difficulty and burned cryptocurrency amount. This parameter change ensures that nodes with more computing power don't automatically win, as they must also invest cryptocurrency, creating a more balanced selection process that maintains fairness while achieving adequate validation speed.

Inventive Principle:

Principle #35Parameter changes

3Device complexity

If traditional blockchain structure is used, then implementation simplicity is maintained, but vulnerability to malicious alterations increases

Engineering Contradiction:

Improveblockchain structure complexityVSAvoidresistance to malicious alterations

Core Design Contradiction:

Device complexityVSReliability

Solution Approach 1:

The blockchain is segmented into a burn chain and a stack chain, with the burn chain serving as an anchored foundation. This segmentation allows the stack chain to inherit security from the burn chain while maintaining a simpler transaction processing structure, thus improving resistance to malicious alterations without excessive complexity.

Inventive Principle:

Principle #1Segmentation

4Reliability

If proof of work difficulty is increased, then security against attacks is improved, but energy wastage increases

Engineering Contradiction:

Improvesecurity against attacksVSAvoidenergy wastage

Core Design Contradiction:

ReliabilityVSLoss of energy

Solution Approach 1:

The system extracts the proof of work requirement from the main transaction processing chain and places it only in the burn chain for leader selection. This extraction reduces the overall energy wastage while maintaining security, as proof of work is performed only when needed for leader selection rather than continuously for every transaction validation.

Inventive Principle:

Principle #2Taking out (Extraction)

Data Source

PatentUS11501269B1Decentralized fair mining pools

Publication Date: 2022.11.15 HIRO SYST PBC

AI summary

An improved blockchain is described herein in which a user burn transaction can be used to increase the probability that another node is selected as a leader. For example, a node can submit a user burn transaction that references a block commit submitted by another node, and may indicate an amount of cryptocurrency being burned in the user burn transaction. The amount of cryptocurrency being burned in the user burn transaction can be summed with the amount of cryptocurrency burned in the block commit referenced by the user burn transaction to determine the probability that the node that submitted the block commit is selected as a leader. While the node that submitted the user burn transaction cannot be selected as a leader, the node that submitted the user burn transaction can share in a portion of the block reward awarded to the node selected as the leader.