Hossein Aghahosseini

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Thesis Topic: Proof-of-Chance: A Blockchain Consensus Mechanism

Thesis Abstract: To update blockchains, a consensus protocol must be used to verify the integrity
of registered transactions by users. Bitcoin, as the largest blockchain network, uses a
Proof-of-work mechanism to reach consensus and rewards users for doing so. This will
lead to the use of costly hardware to execute heavy processing commands with a lot of
energy loss. Different groups have since proposed different mechanisms for reaching
consensus without costly processing. The idea we present here is that first, we define a
public chance variable for each miner, then the miner has to wait a certain amount of
time accordingly and after that he will be able to generate the block. Chance variables are public,
so other members of the network can use it to check the validity of the generated
block. Using this method significantly decreases energy consumption compared to
Proof-of-work, and unlike Proof-of-stake, here the only difference between users is
their luck, not their financial ability. Also, to prevent cyber-attacks, each miner
assigns a trust variable to other miners and updates the varriable when it receives
a new block, depending on the correctness of it and the timing of the mining. To
test this idea, we implemented a Proof-of-Chance based blockchain in Java, and
developed a simulation environment to test it. In our studies and simulations, it was
found that the energy used to record a transaction by a network miner is only 0.085
joules, which is very low and about 268 thousand times less than Bitcoin. After
examining the attacks on the blockchain and ways to counter them, we presented a
formal model for the Proof-of-Chance mechanism in which the miners were likened
to synchronous processors that communicate via one-way public transmission. We
then considered the termination, agreement, and validity conditions for our model,
and concluded that the Proof-of-Chance mechanism could reach a consensus if the
number of adversary processors was less than half.